Circuit City, angling for a comeback of sorts, hopes to raise $25M

At the risk of dating myself, I’m old enough to remember the days when Best Buy had a formidable rival in superstore chains: Circuit City. A cross between an appliance store (at least until it stopped selling appliances) and all-around electronics retailers, Circuit City was the place to be for nerdy, tech-obsessed kids like myself content with replaying video game demos for hours while their parents shopped for a new dishwasher.

Also, P. Diddy once hosted an album release party at Circuit City’s NYC flagship. The more you know!

It’s been nearly two decades since Circuit City rivaled Sears in size and ~15 years since the chain filed for bankruptcy and closed all its physical stores. But after operating as an online-only retailer for a spell, Circuit City is readying a comeback — or at least hoping to raise the money to do so.

This week, the Delaware-incorporated holding company for Circuit City filed paperwork with the SEC indicating that it intends to raise $25 million. Circuit City — which since 2016 has been owned by self-described “retail veteran” Ronny Schmoel, also Circuit City’s CEO — didn’t respond to a request for comment. But the fundraising is presumably the Series A that Circuit City announced in a press release in November.

So what does Circuit City plan to do with the cash if it’s successful in securing it? Not open brick-and-mortar stores, unfortunately. Instead, Schmoel plans to form “strategic alliances” with unnamed national companies (including possibly JCPenny) to launch a “Powered by Circuit City” co-branding program that “[empowers] customers … to explore and purchase a range of electronics, curated by Circuit City.”

The idea, basically, is that Circuit City the brand will offer physical and ecommerce retailers access to its private label products, online retail platform (or what’s left of it) and customer service organization. Schmoel pitches this as a way for retailers to “recognize the potential of [their] lucrative space[s]” without having to build in-house expertise and infrastructure.

“The partnerships are a collaboration of iconic brands, reflecting Circuit City’s dedication to innovation and commitment to delivering strategic AI-driven solutions to an even wider customer base,” he said in a canned statement.

We’ve seen this strategy play out before. Years and years ago, chasing after Apple’s coattails, Samsung and Microsoft launched hundreds of “mini-stores” in Best Buy locations. While they didn’t outright fail, the mini stores weren’t a smash hit exactly — at least not in Samsung’s case.

And, well, I’m not convinced that Circuit City has the same… cachet as Samsung. It seems like an uphill battle from where I’m standing; Similarweb, the web data analytics site, ranked Circuit City’s website 842nd by traffic in the consumer electronics category as of publication time.

But hey, retail comebacks aren’t unheard of. Perhaps Circuit City will go the way of another beloved brand from this reporter’s childhood, Toys “R” Us, and reemerge a force to be reckoned with. Or maybe it won’t raise the modest capital it’s seeking and continue its slow descent into cultural irrelevance.

It won’t be long before we find out. Circuit City’s planning to kick off its co-branding program online and in “select locations” this year, with plans for a more expansive rollout in 2024.