Unilever acquires Dollar Shave Club
Consumer goods giant Unilever has agreed to buy Dollar Shave Club. While the terms of the transaction were not disclosed, Unilever reportedly paid US$1 billion for the start-up.
Founded in 2012, the razor delivery subscription business now has 3.2 million members and in 2015 had turnover of US$152 million and is on track to exceed US$200 million in turnover in 2016.
“Dollar Shave Club is an innovative and disruptive male grooming brand with incredibly deep connections to its diverse and highly engaged consumers,” said Kees Kruythoff, president of Unilever North America. “In addition to its unique consumer and data insights, Dollar Shave Club is the category leader in its direct-to-consumer space. We plan to leverage the global strength of Unilever to support Dollar Shave Club in achieving its full potential in terms of offering and reach.”
Michael Dubin, founder and CEO of Dollar Shave Club, will continue to serve as CEO of the business.
“DSC couldn’t be happier to have the world’s most innovative and progressive consumer-product company in our corner,” Dubin said. “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.”
The deal will intensify the rivalry between Unilever and Procter and Gamble, which owns shaving brand Gillette.
David Pakman, a partner at Venrock and an early investor in Dollar Shave Club published a blog post yesterday, attributing the company’s success to its ability to build a strong brand and relationship with its customers — rather than the virtues of the channel it is sold through.
“Many investors shy away from commerce companies. The multiples tend to be low, Amazon is ever-present, and lots of capital can be required to scale. To us, we didn’t see DSC as an “e-commerce” company, but instead as a model for new full-stack consumer products companies,” Pakman writes.