New York-based rug company Ernesta has secured $20 million in Series B funding to expand its retail footprint and strengthen its technology platforms. The round was led by Addition, with participation from existing investors True Ventures and Platform Capital Management. Previously, the company closed $25 million in a Series A funding round.
The fresh capital will support Ernesta’s ambition to become the defining brand in the U.S. rug market. Since launching in 2022, the company has grown rapidly and now positions itself as the largest custom-sized rug retailer in the United States.
The investment will fund a broader retail presence, strengthen its design-focused tools, and enhance operational capabilities as the company scales its omni-channel platform for interior designers and homeowners.
Building a nationwide showroom presence
A major focus of the new funding is expanding Ernesta’s physical retail network. The company plans to grow its footprint to 30 showrooms across the United States by the end of 2027, building on the success of its existing locations in prominent design hubs.
Unlike traditional rug retailers, Ernesta blends digital tools with immersive showroom experiences. Customers can explore materials and textures in person while using digital tools to customise rugs to fit their homes.
This hybrid approach aims to make rug buying simpler and more precise, particularly for homeowners working on renovations or designers sourcing pieces for client projects. By combining online ordering with physical showrooms, Ernesta hopes to create a more intuitive purchasing journey for a category that has historically relied on showroom browsing or limited standard sizes.
Technology is shaping a more seamless design process
Beyond retail expansion, Ernesta is investing heavily in the technology behind its platform. The company plans to enhance several internal systems that support both designers and homeowners through the rug selection and ordering process.
One key focus is upgrading its Trade Portal, a widely used tool for interior designers to manage custom rug projects. Improvements will also be made to manufacturing and fabrication technology to streamline the production of custom pieces.
Additional features will simplify sample ordering and project management, helping professionals coordinate multiple design projects more efficiently.
These tools form the backbone of Ernesta’s broader strategy, combining curated design options with digital functionality that removes complexity from the buying process.
Leadership changes to guide the next growth phase
As Ernesta prepares for this next stage of expansion, the company is strengthening its leadership team.
Alan Smith, previously Chief Marketing Officer, has been promoted to President. In his new role, Smith will continue to guide brand development, growth strategy, and the company’s go-to-market approach. His promotion reflects his role in building Ernesta’s early brand presence and scaling its customer base.
The company has also appointed Alexandria Norton as Chief Financial Officer, bringing financial leadership experience as the business expands its retail footprint and operational scale.
Rethinking how rugs are designed and delivered
Ernesta was founded in 2022 by the co-founders of Peloton – John Foley, Hisao Kushi, and Yony Feng. It was built around a simple idea of finding the right rug for a space that should not be complicated. The company specialises in custom-sized rugs, including stair runners, cut precisely to fit individual spaces.
Customers can choose from curated materials and styles, with transparent pricing and delivery timelines as short as two weeks.
Through its growing omni-channel platform, which blends e-commerce, designer-focused tools and physical showrooms, Ernesta aims to modernise a category that has seen little innovation in recent years.
With fresh funding, expanded leadership and plans for a nationwide retail network, the company is positioning itself to become the leading brand not only in custom rugs but across the broader rug market in the United States.
“Rugs are one of the most important design elements in the home, yet the category has historically been fragmented, opaque, and difficult for customers to navigate,” said John Foley, Founder and CEO of Ernesta. “We are building Ernesta to change that, with designer-quality custom-sized rugs, curated design and an experience that feels modern and empowering. Our continued 100% year-on-year growth speaks to how much interior designers and ambitious homeowners are appreciating the Ernesta approach.”
“Ernesta is building a truly differentiated brand in a massive category that has lacked a modern consumer leader,” said Lee Fixel of Addition. “The team has combined strong product curation, a compelling retail experience, and proprietary technology to simplify the custom rug market. We’re excited to continue supporting their growth.”
Despite 100 million rugs sold annually, the U.S. rug market remains highly fragmented. Ernesta is positioned to capture this white space by becoming the first dominant, tech-enabled brand in the category.“With Ernesta, we saw an opportunity to build the strongest brand in a category where design matters deeply to Trade and consumers,” said Jon Callaghan, Co-founder and Managing Partner at True Ventures. “The company is creating a modern platform that brings together retail, technology, and supply chain innovation in a way that has not existed before.”
