How Two Guys Turned a Startup That Sells $1 Razors into a $615 Million Company
Back in March 2012, Venice-based startup Dollar Shave Club released a promotional video that went immediately went viral all over the internet. It drew 2 million views within the first three days of launch, and the company received 5,000 paying subscribers on its first day.
The business’s value proposition is simple: for $1 a month, you get mailed five dual-blade razor cartridges — a great alternative to the competition, which is often more expensive and requires you to physically travel to a brick and mortar.
The brainchilds behind Dollar Shave Club is Mark Levine and Michael Dubin, who both came up with the idea when they met at a holiday party in 2010. Dubin, who has a strong background in digital marketing, and Levin, who worked as a product development guy, both believed their strengths would make them a great team. From there, Dollar Shave Club was born.
The pair threw their life savings into their project and worked quietly for the next two years to prove the concept. They managed to build enough traction to secure a seed round of $1 million, but it really wasn’t until the viral video that their company hit the map.
In an unpublished 2013 interview with NextShark, CEO Michael Dubin explained:
“We didn’t have a lot of money so I asked a friend from my improv days to direct it. I wrote and acted in it. With that kind of budget we had to find an inexpensive way to market it. Releasing the video on YouTube made the most sense.”
Flash forward to today, the startup hasn’t stopped growing. Dubin told the Wall Street Journal that his company made $65 million in 2014, three times the amount they made in 2013. With those results they recently raised $75 million at a whopping $615 million valuation with multiple VCs.
While successful now, Dubin admits that it’s been a long journey for him. He spent many years in the digital marketing space working with brands like NBC, Time Inc., Nintendo, Nike and, ironically, Gillette. He even had a startup prior to Dollar Shave Club.
“I’ve always wanted to start a company. My first serious attempt was a social network for travelers in 2006. And there’s plenty of other ideas I can’t wait to circle back on.”
One of the most important elements to Dubin’s success is his ability to create material that makes people laugh. He studied improv and sketch comedy as a hobby in the past and it ended up being a large factor to his success as an entrepreneur.
“Many skills you learn in improv — quick thinking, harnessing spontaneity — are really useful in business. And of course, humor is an important part of how we communicate.”
It’s this one skill that has allowed Dubin and his team to beat out the bigger competition, who have endless pockets of money for advertising. Dubin told Business Insider:
“If you can create content that goes viral it’s going to be cheaper for you to build your business. I’m not going to call ourselves a content company. That would be arrogant. But I do think there’s going to be a commitment here to developing content here whether it’s video or Facebook content, we’ve got a lot of stuff in the pipeline. But whether it’s video, or Facebook content, or other kinds of content, we are going to make a strong commitment to telling strong stories in creative ways and just giving our audience and our customers fun stuff to play with. That’s part of the fun of being an Internet brand.”
The company has put a focus on viral videos since the success of their first one. So far it looks like the strategy is paying off.
When asked whether he’d recommend aspiring entrepreneurs to take the same gamble of investing their life savings in a startup, he said:
“If they believe their idea is good and are able to, then yes.”
NextShark is a leading source covering Asian American News and Asian News including business, culture, entertainment, politics, tech and lifestyle.