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Case study · Dollar Shave Club

How Dollar Shave Club turned one viral video into 12,000 orders and a reported $1 billion sale

TL;DR

Dollar Shave Club started in January 2011 as a razor subscription and got its breakthrough from a March 2012 YouTube video that brought 12,000 orders in 48 hours. Unilever bought the company in July 2016 for a reported $1 billion in cash. The lesson is that a clear offer, delivered with personality, can do the work of a large ad budget.

How it started

Michael Dubin and Mark Levine met at a party and talked about how much razor blades cost. They began operating in January 2011 in Venice, California, using their own money and backing from the startup incubator Science Inc. The website launched in April 2011.

Rather than making razors, the company sourced blades and sold them by subscription. That meant the startup spent its effort on the customer relationship, the brand voice and the delivery experience instead of manufacturing.

How they got the first customers

On March 6, 2012, the company posted a YouTube video starring Dubin. The traffic crashed the company’s server within the first hour. Dubin got it running again and recruited friends and contractors to fill 12,000 orders received in the first 48 hours. Orders were initially packed by hand in a warehouse in Gardena, California.

The video worked because it made a plain offer. Customers get a razor by mail for a low monthly price, and the company says so with humor and confidence.

What drove growth

Investors followed the demand. Wikipedia reports $1 million in seed funding in March 2012 from investors including Kleiner Perkins, Andreessen Horowitz and Shasta Ventures, followed by a $9.8 million Series A in October 2012, a $12 million Series B in 2013 and a $75 million Series D in 2015. Fulfillment later moved to a third-party logistics center in Kentucky.

By 2016 the company reported 3.2 million subscribers. On July 19, 2016, Unilever acquired Dollar Shave Club for a reported $1 billion in cash. Unilever sold a majority stake to Nexus Capital Management in October 2023 and kept 35%.

Lessons you can copy

  1. 1Make one simple offerA razor by mail for a low monthly fee is understood in seconds. If your offer needs a diagram, simplify it.
  2. 2Let personality be your ad budgetThe founder appeared in his own video with a distinct voice. A memorable point of view spreads on its own.
  3. 3Be ready for the spikeThe server crashed and orders were packed by hand with help from friends. Plan your inventory and fulfillment before you publish something that could take off.
  4. 4Own the customer, not the factoryThe company sourced blades and focused on subscribers. A subscription turns one purchase into recurring revenue.
  5. 5Raise money after demand is provenSeed funding arrived in the same month as the video, after the demand was visible.

Frequently asked questions

How many orders did the Dollar Shave Club video bring?

The company received 12,000 orders in the first 48 hours after the March 6, 2012 video, according to Wikipedia’s summary of press reports.

How much did Unilever pay for Dollar Shave Club?

Unilever did not officially announce a price, but the deal was widely reported as $1 billion in cash.

Did Dollar Shave Club make its own razors?

The company sold razors by subscription and focused on the customer relationship and delivery. The sources reviewed here do not describe the manufacturing details, so this page makes no claim about them.

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