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updated 5/28/2013 12:20:12 PM ET 2013-05-28T16:20:12

In 2007 an event called Salvage Fest transformed a Brooklyn public-school playground into a one-time market where renovation-happy locals could buy wares from salvage dealers.

The event caught the attention of Eric Demby, former communications director for Brooklyn borough president Marty Markowitz. Demby sought out Jonathan Butler, the man behind Salvage Fest and the Brooklyn-centric real-estate blog Brownstoner, and together they turned that one-time sale into an ongoing event. The Brooklyn Flea launched in April 2008.

Now the Flea, which is short on the schlock that most flea markets stock, runs destination markets in Brooklyn year-round; occasionally it also leaps across the river to Manhattan for holiday markets and other indoor and outdoor pop-up events. The offerings, a blend of locally made crafts, vintage goods and made-in-NYC food items, are popular with tourists and residents alike.

Vendors pay $100 to $220 to display their wares, based on the venue and amenities. About 75 percent return week after week, eager to sell to the roughly 5,000 shoppers (depending on the weather) who walk the aisles at each event.

The Flea's food offerings have spawned a spinoff, Smorgasburg, a warm-weather weekly market that takes place in Brooklyn's Williamsburg and DUMBO neighborhoods. What's more, the founders have struck a deal with Whole Foods Market to operate out of the Houston Street location in Manhattan. Since October 2012, various Smorgasburg vendors have rotated through the Whole Foods space, each operating a pop-up mini-restaurant for a month; the market also recently started the "Smorgasburg Snack Bar," selling packaged goods, baked items and beverages from multiple vendors.

We asked Demby how he helped turn a dusty old idea into one of Brooklyn's anchor brands.

How do you choose locations for your markets?
The big requirement is that we need to be there only on weekends, but every weekend for months in a row. And we need to pay below-market rent without renting it seven days a week. When we lose a space, we go around and put the word out quietly and look at all kinds of bizarre basements and factories.

Are the shoppers all Brooklyn folks?
It has grown to be a destination for people outside the city. I think in our minds we hoped that it might happen but [we didn't know] we would achieve this global reputation and people coming from all over the world to see us. Japanese magazines and Finnish TV shows--it was nonstop press all the time. It has really grown beyond America as an attraction.

How does the Whole Foods deal benefit your vendors?
The partnership is in its early stages. As of now, it's a nice step up for many of our most accomplished vendors, which we like as a platform for launching and incubating new food businesses--it gives them more options for working with us beyond the markets.

It's not really a good business for us to figure out what they should do next. So the Whole Foods opportunity typically is a medium step for them. They get a monthlong residency. It's a Manhattan audience, they get to be on the big stage and they get promotion. They get to try out being open every day, concepts, service and all of these other kinds of things. You may be a vendor and be like, "I could have my own restaurant."

What's next for the Flea?
We're opening a beer hall and restaurant in Crown Heights [Brooklyn], hopefully by the end of this summer, part of a larger project called 1000 Dean Street. It's a longtime manufacturing zone that's between landmark districts. It's going to have a Brooklyn Flea/Smorgasburg food court; there will be kiosks where you can eat breakfast, lunch, dinner or a midnight snack. Part of it is identifying a business model that works for this in-between restaurant market/food space. Whole Foods has been an interesting experiment for that.

Copyright © 2013 Entrepreneur.com, Inc.

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