Latest tweets from Dollar Shave Club

Dollar Shave Club

"Our Blades Are F***ing Great"

Sector: Futureproduct
Themes:

Dollar Shave Club delivers amazing razors and grooming products for ... a dollar a month. The provocative start-up cuts through an industry built on emotion-driven profit margins to showcase a new world of targeted relevance, disruptive innovation, direct selling, subscription pricing and viral communication.

Michael Dubin has a sense of humour. He wrote, produced, and starred in one of the most viral YouTube videos that’s ever been posted, a 2012 ad for his company, Dollar Shave Club. In it, he brings the viewer on a hilarious tour of his warehouse to explain why “our blades are f**king great.”

A flood of visitors crashed his company’s servers 90 minutes after the video went live. It has been watched more than 22 million times. That video, and the story of its creation, has become entre­preneurial folklore. Today, his business is the second-largest men’s razor brand in America, topped only by Gillette.

Here, in a recent interview, he describes how it all started:

“The beginning of the story is about solving a problem for guys. And the problem that we’re solving at the very basic level, and that we have been very focused on for the last couple years, has been that razors are really expensive in the store. It’s a frustrating experience to go and buy them. You have to drive there. You have to park your car. You have to find the razor fortress. It’s always locked. You have to find the guy with the key. He’s always doing something else that he doesn’t want to be helpful. We actually just launched a bunch of TV commercials set in the store that kind of have some fun with that frustrating experience. They’re doing really well for us.

I launched a beta site in 2011, and I ran that for about eight months. I ran it from my apartment—it was totally bootstrapped—proving out the concept before going out to get some investment. And so I kind of funneled the early dollars from the beta phase into the production of the original video, which I used as a tool to help raise money.

Ultimately we closed our angel round in January of 2012, and that was $100,000 from an angel in L.A. And then we re-launched the site in March of 2012. We closed a million-dollar seed round on March 6th, 2012, which was coincidentally the same day that we launched the video.

The first couple days of that were terrifying. The site crashed because of the traffic, and the video had gone viral, and we ran out of inventory in the first six hours. And I mean, you know, I blocked a lot of that out because it was a very trying, difficult time to get through. You work so hard for years on this idea that everybody has told you is a terrible idea, and suddenly you’re about to prove them all wrong, and your wildest dreams turn into your worst nightmare.

And so that was an intense time. A lot of label-printing at the office, driving the labels down to the warehouse, which was a very small warehouse, not equipped for any commerce operation. I mean, literally there were days when I was taking the trash bags—we were printing out thousands of labels a day, and we were putting them into trash bags because that was the only thing that could carry them. And we were hurling them over the fence at night for the people to pick up the next morning and slap on the packages.

This was a fulfillment house that had never done any kind of mail order e-commerce or anything. They were doing things like wrapping up soap bars and putting them back in boxes for wholesale, or like sticking windshield wiper washer fluid pellets into tubes and putting it back on the truck. They were not experienced fulfilling customized e-commerce orders.

We did $4 million in revenue in 2012. We did $19 million in 2013. And we did $65 million in 2014. And we’re now on a 100-million-dollar-plus annualized run rate. We did $8.5 million in revenue in December of 2014. I would say that that was an intense period for hiring. We brought on a lot of great talent in the very early days that are still with us, all of them are still with us, and all in service of solving that kind of key problem.

I spent about $4,500 on the first video. I wrote it in a day. It was directed by a friend of mine who I had studied improv comedy with in New York when I lived there for about eight years. When I was working during the day at Time, I was studying improv at night along with other things, taking some business classes, et cetera.

Somehow I’ve become known as a standup comic. That is not the case. I was never a professional comedian or actor. Maybe you can clarify that. But it’s sort of become this urban legend that I was a standup comic. I studied improv with a woman named Lucia Aniello, who became a friend, and she just happened to move to L.A. like two weeks before. And I said, ‘Hey, I’m launching this business and I want to launch this video. I want to film this video. Can you do it?’ And she did it for next to nothing.

And all that money basically went into production, and we probably shot it in about eight hours in the original warehouse in Gardena, California, where we were doing all the fulfillment at that time. So I remember leaving that shoot day and thinking to myself, ‘That was good. We did good work today.’ And then I got on a plane to go home for something, I forget what it was.

I had no expectation for how the video would do. I knew when I saw it that it was good, and It was a piece of work that I was proud of. It was funny, and it told the story really well. There’s a lot of funny videos on the Internet. And this one had a real purpose and a real story. And the reason it hit emotional pay-dirt for people was because there was an enormous amount of frustration. And finally here’s something that somebody’s doing about this really big problem. And we also created this piece of social content that was very sharable. Guys talk about how expensive razors are, and we gave them a piece of content that said, “Hey, remember this? We were just talking about this. Check this out. And it’s really funny.” So it went much more viral than I would have expected. And we would have planned a lot differently server-wise, inventory-wise, if we had known. It was a crazy time.”

Update, 19 July 2016

Unilever acquires Dollar Shave Club for $1billion

Unilever is paying $1 billion in cash for the Santa Monica-based business.  Dollar Shave Club founder and CEO Michael Dubin will continue to run the company, which will operate its direct-to-consumer razor business as an independent entity. The acquisition should help Dollar Shave Club expand faster into new geographies (it’s currently in three countries), and significantly improve its distribution abilities in existing markets.

“DSC couldn’t be happier to have the world’s most innovative and progressive consumer-product company in our corner,” Dubin said in a prepared statement. “We have long admired Unilever’s purpose-driven business leadership and its category expertise is unmatched. We are excited to be part of the family.”

Dollar Shave Club had raised over $160 million in venture capital funding, most recently last November at a $539 million valuation. Its seed round of funding was led by Forerunner Ventures, its Series A and Series B rounds were led by Venrock, while Technology Crossover Ventures led its two subsequent rounds.

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