Why Foot Locker is backing Rockets of Awesome, a start-up disrupting the kids clothing market

Rachel Blumenthal is no stranger to starting a business. When the 39-year-old launched Rockets of Awesome, an online kids clothing subscription service and e-commerce site, back in 2016, she was already a seasoned entrepreneur: Twelve years earlier Blumenthal had founded the costume jewelry brand Rachel Leigh; 10 years later she started Cricket’s Circle, an e-commerce baby registry; and in between these ventures, she helped her husband, Neil Blumenthal, launch Warby Parker, the online retailer of prescription glasses and sunglasses that he co-founded in 2010.

Launching these first two companies not only honed Blumenthal’s leadership and management skills but elevated her expertise in another valuable arena: raising capital. While building her previous ventures, Blumenthal established a valuable network of like-minded individuals, venture capitalists and mentors that she leveraged to raise capital for Rockets of Awesome and spark her business. Among them: celebrity moms Serena Williams and Gwyneth Paltrow, along with venture capitalist Kirsten Green, the founder of Forerunner Ventures, whom she met through business contacts and events.

“I’ve been able to build a network of really great people to surround myself with,” says Blumenthal, Rockets of Awesome’s CEO. “I’ve always believed in the importance of building relationships and valuing and respecting those relationships. I’ve also learned the lesson of getting warm introductions to investors and making sure that there are aligned interests or at least something in common.”

All three women investors — a tennis champ, an Oscar-winning actress and entrepreneur, and a founder of a venture capital firm — are committed to supporting female entrepreneurs. In addition to contributing capital, the three gave the start-up instant brand credibility.

“I love the idea of having the support from other female entrepreneurs and incredible advocates for women who I really admire,” she says. “There was no expectation that there would be anything beyond the capital investment, but both Serena and Gwyneth have been generous with their time and advice, and they’ve both been publicly supportive on social media.”

Blumenthal leveraged those relationships, and others she established through her earlier ventures, to raise money from companies like General Catalyst, Forerunner Ventures, August Capital and Foot Locker. To date, she has raised about $49 million, with Foot Locker reportedly taking a $12.5 million minority investment back in February for Rockets of Awesome’s $19.5 million Series C capital raise.

An expansion of Cricket’s Circle — Blumenthal shut down the online baby registry in 2016 so she could shift her focus to children sizes 2 to 14 — Rockets of Awesome now puts her in the ring to take on the global children’s apparel market, expected to reach $339 billion by 2024. Its kids clothes, which she touts as “supercool and seriously fun,” are designed by an in-house team of fashion industry veterans, with prints and graphics meant to be mixed and matched a zillion different ways. The clothes can be purchased online, or a box of eight handpicked pieces can be sent straight to the customer each month through its subscription service.

Women who shopped on Cricket’s Circle provided Blumenthal and her colleagues with a wealth of data on what mothers, specifically, need to keep growing children in clothes that both fit and are stylish. Building trust with customers has helped Blumenthal in turn to build a vertical brand designed and manufactured under the Rockets of Awesome label, keeping the company competitive in an e-commerce world dominated by behemoths like Amazon.

Yet Blumenthal knows a thing or two — literally — about being a mom herself. The inspiration for Rockets of Awesome came from her role as a mother of two children, ages four and eight. The brand’s name was also inspired by kids and created to woo customers, curious as to its origin: By combining single words from thousands of Post-its placed on office walls by Blumenthal’s team to capture the uninhibited exuberance and confidence of school-age children. Ultimately, they chose Rockets of Awesome, joining two words that don’t normally go together.

“Kids love the name,” Blumenthal says. “It’s the first thing that draws them and their parents, probably out of curiosity. ‘What does it mean? What do you do?’ It’s a great conversation starter.”

And a start-up starter.

Emblazoned on T-shirts and bomber jackets, one the company’s first items and a top-seller, Rockets of Awesome is walking advertising for the brand’s site and now store, a pop-up brick-and-mortar store in the Flatiron District in Manhattan, which opened last month in time for back-to-school shoppers. It is scheduled to stay open until the end of the year.

As part of Foot Locker’s strategic partnership, Rockets of Awesome will open mini stores in Kids Foot Locker stores located in malls in major U.S. cities and will become the largest retailer of Rockets of Awesome’s line of clothing in the country. Rockets of Awesome’s mission — to celebrate the real life of kids and to make mothers’ lives easier — aligns with the sportswear and footwear retailer’s values.

“As part of our mission to inspire and empower kids and parents alike, we are investing in new and innovative companies like Rockets of Awesome that elevate the customer journey through inspired storytelling and unique experiences both on- and offline,” says Scott Martin, senior vice president and chief strategy and development officer at Foot Locker. “From subscription models to their latest NYC pop-up, Rachel and her team are driving value for customers in every way.”

At the Rockets of Awesome pop-up, Blumenthal’s ambitions go beyond offering a physical shopping experience for moms and kids.

The 2,500-sq.-ft. space is experiential, designed to engage kids while their mothers shop. A giant rainbow swing is positioned mid-store. The dressing room is stocked with hundreds of pounds of stickers kids can plaster the walls with. At the checkout, glass jars labeled with questions like “How did you hear about us?” collect data by offering shoppers glitter bouncy balls inscribed with a choice of responses: ‘Word of mouth,’ ‘influencers,’ ‘celebrity moms,’ ‘walking by the store.’

“The data we collect enables us to deliver the most personalized experience and most precise products that we’re putting in customers’ home and that they are seeing on our site, in our emails, in our store,” Blumenthal says. “We’re collecting data at every single touch point that customers experience with us to benefit their journey with us and influence how we design our product line.”

As a result of the company’s deep and immediate connection with customers, Blumenthal and her team can see at any point in time how a product is selling, then wade deeper into that item and line, fast-track it to similar products that have a high sell-through, or pull back on a placement that’s less successful.

Currently, two data scientists are at work creating proprietary algorithms to better capture, analyze and react to collected data.

Although the company doesn’t share financials, its growth over the past three years is evident in the line of items offered through the three consumer channels: 200 items, for boys and girls, each season, with the iconic Rockets of Awesome bomber jacket now available in 10 colors and fabrics.

“The introduction of the new channel is representative of our success and the growth of the business,” Blumenthal says of the pop-up store. “We are incredibly excited by what we’re seeing in the brick-and-mortar. It’s surpassed our expectations. And we’re incredibly excited to find what this integration of the physical and digital can do to support each other.”

Rockets of Awesome’s expansion offline also comes at a time when the industry for children’s apparel is incredibly fragmented, and there doesn’t appear to be a clear winner. In a trend that has been called the retail apocalypse, hundreds of stores have gone dark or are struggling, including The Children’s Place, which is shutting dozens of stores this year, and Gymboree, another brick-and-mortar children’s clothing chain, which filed for bankruptcy in January.

What this may mean is that the niche is ripe for reinvention from a newcomer with a fresh and brash approach.

Three years out, the challenge for Rockets of Awesome now is managing fast growth. As the start-up team expanded from 10 to 60, visibility and open communication gave way to departments and divisions of responsibility. In July of this year, the company was able to nab Scott Turner, the former Walmart e-commerce director, to become its senior vice president responsible for digital and marketing.

“I think that going from very little process to structure can feel scary to people because they feel they’re losing what they had five minutes ago,” says Blumenthal. “The solution is for me to walk them through the changes and take them through the journey.”

For a young company, this is a good journey to be on.