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Carbon38 just scored a $15M investment from Foot Locker—here’s what that means for you

Carbon38 expansion Pin It
Photo: Carbon38

Carbon38 is basically the Beyoncé of fitness fashion—that’s to say, a total trailblazer that thrives on doing the unexpected. Back in 2013, it was the first retailer to make online activewear shopping a luxury experience; two years later, it launched a groundbreaking fashion line of its own, complete with “out-of-studio” pieces like blazers and cocktail dresses in performance fabrics. (That move probably raised a few eyebrows at the time, but now other athleisure power players are following suit in a major way.)

So what does an icon do when it’s officially at the top of its game? It teams up with other heavyweights to drop some headline-worthy collabs, of course.

Not only did the brand recently confirm it’ll be opening its first permanent brick-and-mortar shop in Los Angeles this summer—at Palisades Village, one of the most buzzed-about new retail developments in the city—but it also just announced an investment partnership with Foot Locker, which took a $15 million minority stake in Carbon38 a few weeks ago.

“Foot Locker’s amazing backbone will allow us to deliver to more customers, get our products to customers faster, and explore international opportunities.”

According to Carbon38 co-founder and CEO Katie Warner Johnson, Foot Locker’s investment marks the first time a large activewear retailer has joined forces with a fitness fashion start-up—something that’s happening a lot in other markets. “If you look at the food industry, for example, the big players like Kellogg and Coca-Cola have been making investments and acquisitions in indie food brands for a while now,” she says. “But in the [active] retail space, there hasn’t been a real impetus to invest in the future. I think Foot Locker is taking that first step and putting a stake in the ground.”

Clearly, both sides will benefit in this marriage—and so will you. “Foot Locker’s amazing backbone will allow us to deliver to more customers, get our products to customers faster, and explore international opportunities,” Johnson says. “In terms of our service to customers overseas, we’ve been limited to our one warehouse in California—and the shipping rates that originate from that one warehouse in California. Plus, most of our international [shoppers] are in Asia and Australia and most of theirs are in Europe, so that’ll be a new customer base for us to explore.”

Foot Locker will naturally reap the financial rewards of this expansion, while being able to tap into Carbon38’s technology and product expertise—particularly when it comes to its own women’s athleisure retail brand, Six:02. “We expect to leverage the [Carbon38] team’s keen industry insights and focus in order to elevate our own Six:02 banner’s performance,” says Lauren B. Peters, Foot Locker Inc.’s executive vice president and chief financial officer, in a statement.

Carbon38’s luxury cred is also sure to add some cachet to Foot Locker’s women’s portfolio, which largely caters to a younger and more mass audience. (Given the rapid rise of Six:02—which now numbers 32 stores across the US and carries covetable brands like Ivy Park and Fenty x Puma by Rihanna—fashion is clearly climbing up Foot Locker’s priority list.)

Carbon38 expansion
Photo: Carbon38

And, of course, Foot Locker’s experience in running a 3,800-store brick-and-mortar empire will surely be an asset as Carbon38 expands into offline retail—although the younger brand will definitely still be doing things its own way.

“There’s a lot to learn from them, but we aren’t planning to have hundreds of stores across the country,” says Johnson. “Our approach to brick-and-mortar is going to be very specific and special and very catered to the neighborhoods we’re looking to serve.” (She can’t give details yet, but she hints that digital advancements in personalization and AI will likely be infused into Carbon38’s online and IRL experiences going forward.)

So can we expect to see Carbon38-branded displays in Six:02 stores, like Amazon has in Whole Foods? Not quite. “Our companies will be running separately—we serve very different customers,” Johnson says. “But now, I’m able to talk to people I’ve never been able to get on the phone before—from sourcing channels to shipping and fulfillment to real estate. And while that opens a lot of doors, our plan isn’t changing as a result of all this. We’re still a premium active fashion retailer and brand.” One that’s more determined than ever to, you know, run the world.

One activewear giant that’s been battling some not-so-great press recently: Lululemon. Here’s how one expert thinks it could get its mojo back