Arcade, the generative AI-powered marketplace known for jewelry design, is branching out into home decor—starting with custom rugs. The platform’s latest move lets users craft unique rug designs using AI, adding a new layer of creativity to their living spaces.
In addition to this expansion, Arcade unveiled a feature called “Match My Room,” allowing users to upload a photo of their space. The AI analyzes the image to ensure the rug design complements the room’s colors and style, making it easier to achieve a cohesive look.
Arcade also secured $25 million in Series A funding, boosting its total capital raised to $42 million. The round was led by Canaan Partners’ Laura Chau, with support from notable investors like Forerunner’s Kirsten Green.
Much like its jewelry generator, Arcade’s new rug creation tool leverages AI models such as Midjourney and Stable Diffusion. Users start by selecting materials like wool, cashmere, or alpaca. After entering a text prompt describing their ideal design, the platform generates a visual concept. Once satisfied, users get paired with a manufacturer who provides a free sample for approval before purchase.
Based on initial tests, prices start around $400 for a 3×9 hand-tufted wool rug, making it a more affordable option compared to luxury brands charging thousands for similar pieces. Prices increase for premium materials like cashmere, alpaca, or mohair. Still, Arcade positions itself as a budget-friendly alternative without compromising quality.
The “Match My Room” feature is particularly helpful for shoppers who want a rug that ties together their interior design. While the AI accurately matches colors, it struggles with replicating complex patterns from other decor pieces like pillows or throws. Nonetheless, it’s a valuable tool for those seeking color harmony in their space.
For users who enjoy designing just for fun, Arcade offers “Dream Boards”—a creative space similar to Pinterest. These themed collections showcase curated designs like Hollywood-inspired earrings or intricate rug patterns. Shoppers can browse, save favorites, and even purchase items directly from these boards.
Arcade is also boosting creator incentives. The platform’s seller program now offers 5% commission per sale, doubling its previous payout. For those serious about monetizing their designs, Arcade’s new entrepreneur program offers even higher commissions. Content creators and influencers with over 25,000 followers are encouraged to join by reaching out to Arcade’s marketing team.
Since launching its jewelry design beta in September 2024, Arcade has generated over 650,000 unique jewelry designs. However, the company hasn’t disclosed how many of these designs were actually purchased or the commission earnings made by sellers.
Arcade is the brainchild of Mariam Naficy, founder of beauty brand Eve and design platform Minted. Naficy aims to build a creative hub where anyone can turn their ideas into tangible products.
The recent funding will be channeled into hiring, platform upgrades, and expanding product categories. Beyond rugs, Arcade plans to introduce ceramics, pillows, and even apparel and leather goods. According to its website, chain belts are also on the way.
Arcade’s impressive investor lineup includes Ashton Kutcher’s Sound Ventures, Offline Ventures, Reid Hoffman (LinkedIn co-founder), Inspired Capital, Torch Capital, and David Luan, CEO of Adept AI Labs and former VP of Engineering at OpenAI.
With this expansion, Arcade is positioning itself as a one-stop platform for AI-powered custom designs—whether for jewelry, home decor, or soon, fashion.
