Dollar Shave Club, with its slogan “Our Blades Are F—ing Great,” just got valued at $US615 million.
The Los Angeles-based startup launched three years ago with an idea to steal market share from razor powerhouse, Gillette. CEO Michael Dubin promised a better price point: for $US1 a month, Dollar Shave Club sends you a high quality razor. He created a crude and goofy viral video to support the launch which garnered 19 million views.
One year later the blade purveyor began to sell peppermint-scented butt wipes called “One Wipe Charlies” and it released another viral video.
Later, it launched other products like hair gel and shaving cream in its monthly packages, but razors remain the company’s best-selling product.
Dubin tells WSJ he was able to nab a high valuation for his startup because DSC’s revenue keeps growing quickly, aided in part by Dubin’s marketing prowess. In 2014, the startup says it generated $US65 million, triple that of its 2013 revenue, with 2 million monthly and bi-monthly subscribers.
Dollar Shave just secured a $US75 million round of financing led by New York-based investor, Technology Crossover Ventures, in June. The money will be put toward product development and hiring.
Dollar Shave Club, like many high-growth tech startups, isn’t profitable yet. It has been turning its viral videos into expensive TV spots, and WSJ says it’s burning millions of dollars each month.
The shaving space has also gotten incredibly competitive. Dollar Shave faces a lot of competition, from Gillette to other razor startups like Harry’s, which has raised more than $US100 million and owns its own factory.
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