Dollar Shave Club, the mail-order razor small company that went viral after their Youtube ads, has been bought by Dutch personal-care products giant Unilever for $1 billion. In 2011, Michael Dubin and Mark Levine met at a party in which they talked about the razor blades increasingly expensive costs.

Out of that conversation, an idea came up, and in July 2011, Dollar Shave Club began operations, founded with their money and investments from start-up incubator Science Inc. The company’s idea is pretty simple, and they deliver razors and other personal grooming products directly to the consumer’s door at lower prices when compared with retail chains.

Dollar Shave Club offers three membership plans, which can be upgraded or downgraded at any time. Image Credit: Boxba
Dollar Shave Club offers three membership plans, which can be upgraded or downgraded at any time. Image Credit: Boxba

The first program is called the Humble Twin, which costs 1 dollar monthly, plus two dollars for shipping, and includes a razor with two stainless steel blades and five cartridges per month, using the slogan “for guys who dig simplicity and precision.”

The second plan, the 4X, costs six dollars a month, with free shipping, and includes a razor with four stainless steel blades and four cartridges per month. It is also advertised for women. The final plan, the Executive, costs nine dollars per month, also featuring free shipping and includes a razor with six stainless steel blades coupled with four cartridges per month.

However, the company reached new heights on March 6, 2012, when they published a Youtube video starring Dubin. The video went viral, crashing the business server, and receiving 12,000 orders in the first 48 hours. As of July 2016, the video has received more than twenty-two million views.

It has gone very well for Dubin and Levine, given the popularity the brand received for the video. Their company is now backed by several venture capitalists and was said to be worth $539 million, based on the $160 million in venture capital it raised. But the Wall Street Journal has stated that, despite having 3.2 million members and revenue last year of $152 million, the company is not out of the blue just yet.

The little company impressed Dutch giant Unilever, who is looking to fight against Procter & Gamble, whose Gillette brand dominates the razor market. Seeing the success it was receiving, Gillette got into the razor subscription business as well.

But Gillette was not happy with just that as the company also sued Dollar Shave Club for patent infringement over its blades. Dollar Shave Club fought back by counter-suing early this year. However, further meetings will be scheduled to address the legal battle between both companies.

On Wednesday, Unilever announced the agreement to buy the company for 1 billion dollars, meaning the brand is getting into the razor business. Unilever also praised Shave Club’s “unique consumer and data insights” adding it was “the category leader in its direct-to-consumer space” through a press release. Kees Kruythoff, president of Unilever North America, has also stated that the giant plans “to support Dollar Shave Club in achieving its full potential regarding offering and reach.”

Michael Dubin will remain at the head of his brand and in a given statement said that his company “couldn’t be happier to have the world’s most innovative and progressive consumer-product company in our corner.”

Source: Washington Post