This podcast is brought to you by Squarespace. I talk to entrepreneurs all the time who are looking for a way to upgrade their digital footprint. Well, whether you're just starting out or you're scaling your business, Squarespace is the easiest way to build a great website that stands out. It's an all-in-one website platform that gives you everything you need to claim your domain, showcase your products, and get paid.
Anyone can use Squarespace's cutting-edge design tools to build an online presence that truly reflects what makes your business special. There are templates, intuitive drag-and-drop editing, and even an AI-enhanced website builder. Then, Squarespace's built-in analytics tools help you make smarter business decisions, review website traffic, learn where to focus engagement, and track revenue all in one place. Looking to grow your business?
Squarespace even offers fast, easy business financing through Squarespace Capital. Go to squarespace.com.com.com for a free trial. And when you're ready to launch, use offer code BUILT to save 10% off your first purchase of a website or domain. Loans issued by Celtic Bank and Service by Stripe, all loan subject to credit approval.
This show is in partnership with Airbnb. This past summer, I took my family to Vienna, and it was incredible. We spent our days wandering the old streets, stopping for coffee and pastries, visiting museums, and just soaking up the history of one of the most beautiful cities in the world. And one of the things that made the trip so special was the home we booked on Airbnb.
It had tall windows, beautiful old details, and plenty of space for all of us. And being in that home on Airbnb, right in the middle of Vienna, walking distance from so much of the city, made it feel less like a visit and more like we were actually living there. Plus, taking a trip is the perfect time to host your space on Airbnb. Your place, with all of its personal touches and its amazing location, could make someone else's vacation even better.
Your home might be worth more than you think. Find out how much at Airbnb.ca. Hey, everyone, it's Guy here. So we're getting our team a short break over the holidays.
So we're bringing you an episode from the archives. And this one is from back in 2018. It's the incredible story of Michael Dubin and how he built Dollar Shave Club. It's one of the OG direct-to-consumer brands.
And you'll hear how a viral launch video took Dollar Shave Club from zero to a billion-dollar acquisition by Unilever in just five years. This episode was actually recorded in front of a live audience in Los Angeles. It was so much fun, and I think you'll love it. So our first investor was a company called Science Throughout Santa Monica.
They gave us a $100,000 check. Actually, they gave us a $100 check by accident first. And I got all the way to the bank. I literally got to the bank and I was like, here's my check for $100,000.
You'd fill out the foreign that said $100,000. And I fill it out, and the woman looks at me, and she's like, uh-huh. Welcome to How I Built This, a show about innovators, entrepreneurs, idealists, and the stories behind the movements they built. I'm Guy Raz, and on today's show, how Michael Dubin turned eight years of experience in-prov comedy and video marketing into the billion-dollar Shave Club.
So think about the billion-dollar companies that didn't even exist 10 or 15 years ago. Companies like Airbnb or Lyft or Snapchat or Spotify or Hulu. Pretty incredible if you think about it, because there's a pretty good chance that today you use at least one if not all of these services. And even if you don't like what these companies offer, you can't deny that they're innovative.
That they all offer a new way to do something, to get around or find a place to crash or listen to music or watch TV. These are some of the sexiest startups in recent years. But now, imagine a completely opposite idea. A business that not only offers a boring product, but a product that is dominated by one big company.
I'm talking about men's razors. And just a decade ago, Gillette owned about 70% of the US shaving market. But today, Gillette's overall market share is closer to 50%. And that's partly due to a company called Dollar Shave Club.
It's a company that decided to take on Gillette, not by offering a better razor, but by offering a better story. In fact, the story of how Dollar Shave Club went from a scrappy website to a billion-dollar exit in just five years is more about Michael Dubin's instincts and marketing chops than it is about anything else. Because for almost eight years before he launched Dollar Shave Club, Michael Dubin was doing two things that would help him figure out how to penetrate an impenetrable market. One of those things was creating videos for corporate clients.
And the other, probably more important, was taking improv classes at night. Those two skills would help Michael create one of the most successful guerrilla marketing campaigns in modern history. But long before any of that happened, Michael had what he calls a pretty normal childhood in the suburbs of Philadelphia. His dad was a lawyer and his mom was a teacher and then later worked in real estate.
Earlier this month at the theater at Nisotel in downtown LA, I sat down with Michael Dubin in front of a live audience where I wanted to find out why on Snowy Days his mom used to force him and his sister to stay inside and solve math problems. Alright, welcome Michael. Thanks for having me. Is that actually true that on Snow Days your mom would make you solve math problems or is that apocryphal?
Yeah, we weren't allowed to, you know, it was like you can have fun, but before you have fun, you're going to be productive. And I think we carry that with us wherever we go. There's like a little bit of guilt that we have whenever we have fun somewhere. Yeah, you're like, I should be doing math problems.
Yeah, exactly. That's a good lesson. Do your work first, have fun later. Yeah.
Alright, so you grew up mainly, I guess, in the suburbs of Philadelphia. So I'm curious, and this is a little bit foreshadowing here. So I don't want to get too ahead of ourselves here, but as a kid or as a teenager, were you into theater or acting or school plays and dramas? Did you do that kind of stuff?
I did. I was always in the school play. I was in the, I was the lead in a school play in fourth grade. It was called Peace Child.
And Peace Child was all about preventing a nuclear holocaust through song. And literally, no, truly, there was a song that was called I Want to Live. And something like, I want to live the right to live my life. I don't know.
It was really like, I'd love to see it. Alright, so I think you know why I'm asking questions about theater because we'll get to that later and the theatrical stuff. But what about general academics? I mean, did you feel like you were a good student or did you become a good student?
I was not a good student. I was not a horrible student. I was good at the subjects that I was interested in. But if I wasn't interested in the subject matter, it was really hard to get me to pay attention.
I'm also, I was probably one of these kids that went undiagnosed with ADD and I think that probably contributed to it. But yeah, I don't think that I was much of a student. I did okay. Good enough.
Pretty good school. You went to Emory University. I did. And you studied history there, right?
I actually started out as a poly-sci major, but I flunked poly-sci 100 actually twice. I flunked the same class twice in back-to-back years, which goes to show you what kind of student I was, my freshman and sophomore year. And then couldn't do that anymore. So I became a history major because I always loved history and I loved reading about history and studying history.
So I actually did fairly well with that. I had a killer internship with a company called Bright House and I also got super into my internships at CNN. So I actually did more extracurricular, I think, in college and I got really into those things and that helped set me on my career afterwards. So you graduated college and what did you do?
So I became a page at the NBC page program. Like Kenneth? Correct. But this was before Kenneth made the page program cool.
Kenneth wasn't very cool. So yeah, I was a page program, which for anybody that knows what the page program is, you get to, it's 50 kids that they take right out of college. And you basically have the keys to the castle. You run around NBC Rockefeller Center and the studios and you see the audiences for the shows.
You give tours of the studios and the trade-off is that they give you an opportunity to take many jobs in different departments. And so those many jobs can be with Saturday Night Live or Nightly News or, you know, at that time the Rosie O'Donnell show was still on the air. And you do those mini jobs or assignments for 10 weeks each. So I had some pretty cool assignments.
And it was just, I mean, I've said this before, but outside of this job at DSC, that was my favorite job. So was that your idea that you would stay in journalism or media? Like was that where you sort of think, you know, this is what I'm, maybe this will do? Yeah, I was super passionate about it and went to work at NBC and then went to work at MSNBC versus a PA and as a writer.
And I thought that I would have a career in the media and maybe even in journalism. But I think at a certain point, the 24 hour news cycle, you work all day to build a story in a narrative and then at 5 p.m. right before your show at air, they would, you know, there would be some breaking news and all your work would get thrown out. And then I also felt like it was right on the time that I started thinking like I really want to be in marketing or advertising.
And how did you, I mean, how did you make that leap? Like, had you been exposed to marketing and advertising or did you just think this could be interesting? Well, I had this really sort of formative internship in Atlanta. And I got an opportunity through a friend of mine's cousin who ran a small marketing firm in New York City that was doing, you know, client service work for a couple minor league sports teams.
And the main project that I worked on was I worked on an early website for an alarm company. And then I left with one of the partners at that firm to go over to Timing and Life Magazine and the Relaunch of Life Magazine in 2005, I think this was. And I spent a couple years at life and then I spent a couple years at Sports Illustrated, Sports Illustrated.com. And that work in general was I built a, you know, back in the day, people might remember the term micro sites.
I built micro sites for some of the big brand advertisers at life and for Sports Illustrated, you know, those could have been for Gatorade or for Sega. And you were just learning how to do this on the job. Exactly. So like you would build a micro website or make a video or something for these brands.
Exactly. Just figuring out what would be interesting to a user, how to present visual information with some copy in a way that's digestible. How would I layout this website? And you know, I've always been a bit of a visual thinker.
So it's fun. UX, UI is a maze or a puzzle. That's what great architects do. That's what great restaurant designers do when they lay out a space or design a hotel lobby.
You know, it's great. What great product designers do UX, UI designers do. They create these mazes for people to go in. And that's enormously satisfying when you can watch masses of people follow your lead.
Yeah. So this is happening in New York, in the early 2000s. And you decide to take improv classes. Something you did for almost eight years.
How did that start? Was it just something you wanted to do for fun? So I've always been passionate about comedy. And I'd heard when I worked at NBC that all of the great comedians that were on SNL had trained in improv.
And a lot of them had trained at the Upright Citizens Brigade, which at the time they only had one studio in the West Village. No one's Chelsea. And I was just, you know, I said, well, I want to do that. And you could just sign up, just pay the fee and join.
Yep, pay 300 bucks, take the entry level class and see how you do. And it just stuck. I felt totally in love with it. Before too long, I was taking sketch classes as well.
And you do this, like, weekly or? Yeah, you take a couple classes a week. If a sketch class, you have some homework to do, you have to write comedy sketches. You go and you practice the improv at night with a bunch of people that you've never met before.
And you go rent some weird studio space and you make jokes at 9 p.m. And it's, you know, a very bizarre experience. So you had this marketing job during the day making videos and at night you were doing improv. And I was also trying to start my first startup, which was a social network for travelers.
So, yes, I was busy. And what happened to the social network for travelers? Not much. Okay, I got you.
So, you know, what I'm trying to understand, I mean, there must have been something about improv. Like, I have to imagine in your mind you're thinking, maybe I have a shot at being a comedian or being on SNL. Or was that what you were thinking? I would never admit that, but yes.
Got it. Yeah, that's right. Because why would you take improv classes for years? Yeah, I mean, listen, I would go to the upright citizens brigade two, three nights a week and just watch the most amazing comedians perform.
People that have gone on to have amazing careers, people like Donald Glover. You know, I went to go see Donald Glover when he was doing these shows in a basement in Chelsea under grocery store. And you're watching six to ten people on a stage, pull ideas out of thin air and weave them together into a story that makes you laugh. And comedy is one of the hardest things to do, period.
There's a set up and then there's the equal sign, right? It's A plus B plus C equals ha ha ha. And that takes magic. That takes real talent.
And so it's addictive. And when you get it right and when you do it well, it's a high. And I also, it was such a great way to blow off steam in the evening as well because you would have these really hard long days at work where you're getting branded by your boss at work and, you know, you're trying to start the social network for travelers in the margins. And, you know, then it's like, you know, you could go to the gym or you could go just completely blow your mind and do some improv.
Was there any part of you that thought, this can help me one day if I want to start a business? Was that even a kernel of a thought in your mind? No. Wow.
Because right now, you would think, okay, when you're 20, do some improv, learn marketing and then he'll be... Yeah, right. Then I'll raise yours on the internet. Yeah.
So there's... So you are in your 20s. You're in New York. I guess you're by this point approaching your early 30s.
And you decide to leave. You decide to just go and move to here to Los Angeles. Why? I mean, quit your job in marketing in New York.
Leave improv, troop there and come here. What? Yeah. Well, I got laid off.
No hero story there. Okay. Sorry. Sometimes life happens on you.
So, yeah, I got laid off. I was dating a girl at the time who lived in Los Angeles and I always wanted to live in California at some point. So, you know, life happened on me and I said, now's the time. Like, you know, screw it.
I've not got nothing to lose. So no plan, no job. You just came out here. No plan, no job.
Just came out here. And what did you start to do? So I, through a friend, I was able to get a job at a small video marketing agency. And what they were doing is they were helping brands develop and distribute video content.
And this was probably 2000, 2010. So, similar, kind of similar to the work that I had been doing, doing work for big brands, putting it online. But doing it in a space that was, you know, pretty squarely in video. So, I'm curious to find out.
I guess it's sort of somewhere near the end of 2010. This is a fateful moment for you because you meet somebody. You are at a holiday party here in LA. You meet a guy named Mark Levine at this party.
Who is Mark Levine? What's that party? What happens there? So, Mark Levine is my friend's father.
He was a business man. He had a successful career in South Africa and came to the United States. And he was an importer. He was like our family friend who would show up sometimes with a truck full of soccer balls or a truck full of bikes.
And you'd be like, where are the bikes from? He'd be like, do you want a bike or not? And so you're like, yeah, I'll take a bike. So, yeah, we've been trying to get connected for a while because he had heard that I had worked in the internet inside the internet.
And he wanted to meet me because he had all this stuff in a warehouse that he was looking to unload. Like, when you say stuff, he would just import whatever stuff. Well, the two things that he approached me about were he was like, I've got razors. I've got about 250,000 razors.
Okay. He also had a couple thousand cake slicers. Cake slicers. Yeah, so the cake slicers were called piece of cake.
The slicer themselves was shaped like a wedged piece of cake. Yeah. So, you know, forget about the worry of having a slice twice when you want a piece of cake. Now you take your piece of cake and you put it over the cake.
Wow. And out comes the perfect slice of cake. I need to know why we are not talking about Dollar Cake Club. How was that?
How was that not the product that you said to mark? Oh, my God. Amazing. The cake slicer.
Yeah, I'm in. I just knew that, you know, gluten-free was going to be the next thing. And I just wasn't going to be a market for it. All right.
So, you are at this party, this holiday party. And he's like, yeah, I've got a warehouse of 250,000 razors and thousands of cake slicers. Are you in? Is that what he said?
He was like, you know, yeah. What do you think? And I was like, well, let's give him a try and we'll see what we can do. So what happens?
Like you go home and then you call him and say, okay, I want to go check out these razors. Yes. So I knew that I wanted to get access to the razors because I had always bristled at the price of razors. And I had always, there was a time, and I remember this specifically, when I was living in New York, I would walk right past the Duane Reed on my way from Rockefeller Center to the subway on the F train when I go downtown.
And I would need razors. And I just wouldn't want to go into the store to buy the razors because the razor fortress is always locked. You have to find the person with the key. They're always doing something else.
Yeah. And you actually feel like you're inconveniencing them for, you know, helping you get a product. It's the only product. Like that.
Or one of the only products that's like that in the store. And I didn't in 2006 to say, this is a problem that I'm going to go solve. But at that party, he said, the razors are great. What do you want to do with them?
I had the idea for Dollar Shave Club right there. All right. So you go and you go check out this warehouse. So the razors are in a warehouse in San Bernardino, Rancho Cucamonga, which is like an hour east of here.
And I get out there and there's a guy there and I'm like, hello, I'm Mark Levine's partner and I'm here for the razors and he's like, oh, you're Mark Levine's partner and I'm like, yes, yes, I am. They're like, great. These razors are about to throw these razors out. So the razors have been there for so long and the bill hadn't been paid.
I'm sure the market's forgotten about the razors space. I'm sure that he had almost forgotten about these razors. So I had to go get $700 sight unseen and give it to the guy so that he didn't throw out the razors and I could have access to them. So you go in, you see the razors and go in, see the razors.
I look at them and I say these look like razors that I would use. I take them home. I shave with it and I knew that we had something. Wow.
So you get home and you call them and you say, hey, I think I can sell these and he says, great, go knock yourself out? More or less. Yeah. Well, I want to put them online and I think that the best way to do it is to create a subscription mechanism where people don't have to go to the store to get them.
They come automatically and yeah. How is it at that very moment? Because it sounds like that's what you're saying. You were thinking, this is the business I'm going to do.
I'm going to drop everything. I'm going to focus on this thing. What was it about 250,000 razors in a warehouse in Rancho Cucamonga that inspired you to think like that? Well, because I knew there was a problem and I think that a lot of entrepreneurs will tell you that they trust their gut and I trust my gut and my gut told me that the problem that I had observed back in 2005, 2006 when I had that feeling of not wanting to go into the store because the razors were overpriced and the buying experience was super frustrating.
If I had that feeling, I knew there were other people like me that would have that, that we're experiencing that same frustration and I knew that there was an opportunity and like also like a lot of entrepreneurs, once you become focused on an idea and you've identified a problem that needs solving or a thing you want to bring into the world, it's really hard to get that out of your head. I believe truly that there was a problem worth solving here and I certainly didn't think that it was going to become what it has become but I knew that there was enough there to make a couple bucks. And what about the name? How did you, was the name also part of the idea from within a few days of meeting Mark?
I wanted the function of the business to come through in the name and I think if you, you know, were to pluck somebody off the street and say, what does a company called Dollar Shave Club do, you should probably be able to figure that one out. So if I was, if I knew you then, right, and I probably would have said to you and I have to imagine other people said to you, Michael, you're like a 30-something dude and you want to try to enter one of the most impenetrable markets, razors and shaving in America. I mean, Gillette, Chick, did anybody, your family or anybody say to you like razors? This is like, this market is dominated by like two or three companies.
Yeah, I don't know that anybody quite phrased it like that. So yeah, I mean, you know, my family, you know, but like, don't listen to your family because for a lot of reasons, I mean, listen to your family for a lot of reasons but don't listen to your family for some things. I mean, the way you've laid it out is exactly right. This is, you know, Gillette at the time had, you know, an effective monopoly on this particular consumer product in this category and, you know, for a nobody to come in with, you know, is Rancho Cucamonga razors and, and like, change the way that people think about that category.
Like, you know, I would never have said it that that's what I was going to try to do. Yeah. Because it would have sounded crazy. When we come back, how Michael Dubin and his Rancho Cucamonga razors actually did end up changing the way millions of people would buy shaving products.
Stay with us. I'm Guy Raz and you're listening to How I Build This. Hey, welcome back to How I Build This. I'm Guy Raz.
So it's from the beginning of 2011 and Michael Dubin wants to see if he can get any traction with Dollar Shave Club, his new company that sells razors on the internet. And to fund it, he puts in some of his own savings and he also gets an investment from Mark Levine, the guy who had that warehouse full of razors that he needed to get rid of. And so Michael hires a few people to help him put together a beta website. So the goal of the beta site was really to test different pricing models, test different forms of engagement.
And you know, the first brand that we launched was not what it is today. It was really just, you know, what we've all come to know as an MVP, minimum viable product. And let's just get something up, let's see how it does and let's see what the feedback is. What we were trying to learn is what was the best product to sell, what was the best assortment to sell, what were people liking, what did they want more of, and really just, you know, can we move these razors and what, yeah, what do people want out of this type of a service?
So in that first year, you were really kind of seeing if people would get to the site, seeing what they were buying. How did you even reach people so early, like by Google ads and things like that? Yeah, we did a group on, I went to a mom blog conference down in like San Diego or something. And I mean, you know, this was real street hustle at the time.
And like, you know, you buy, you buy, you do your own SEM in your house. And I still remember our first customer, it was Imran Charnania of Houston, Texas. He just found you online? He just found us online.
And I remember where I was sitting when this first order came in, which was the first stranger validation, right? Because obviously my mom had bought some and, you know, like the other people, my buddies had bought some. And yeah, the first real sale came in and like that validation, like, you know, that first thrill of that first sale is like all the encouragement that you need as an entrepreneur to be like, yes, somebody gets it. Yeah.
So obviously at a certain point, and this really comes ahead in March, I think of the day it was March 6th, 2012, your background and video and your background and improv magically come together. Unplanned. When you release a video, what was the story about that video? How did that come about?
Yeah. So I knew that this was a fairly simple story. Raisers are overpriced, you're overpaying for the technology, and you can get a great shave without having to pay such a high price. And I knew that if you just told that story flat, it would sound flat.
So I wanted human to be a part of the brand, and I wanted to make a video, and I knew how to write, and I sort of knew how to act or perform. And I called up a friend of mine, Lucia, creator, director of Broad City Now, but she was... You met her at the... Directed one of the shows that I was in at one point.
So yeah, I met her as part of that community. And you asked her to help you with this video? I said, she just moved to LA, too, and I said, hey, I'm starting this company. I want to do a video advertisement that tells the story, it's going to go on the home page.
Like, you know, I wrote a script, and you meet me for coffee, and like, give me notes on the script and then help me film it. So we met for coffee. She looks at the script, she says, I really like it, added a couple of jokes. So the line, are our blades any good?
No, they're fucking great. Used to be, are our blades any good? No. And then some other bad joke.
And she gave me that line. So that too, Lucia. And we rented out the warehouse that we were filling packages in for the day, that background that you see. I mean, they fulfill all kinds of crazy stuff.
By the way, four people haven't seen it, which is you starting with you behind a desk and it tracks you. It follows you through this warehouse, and we meet a toddler shaving the head of a grown man. We see a bear, a man, and one in a bear costume. You've got one of your warehouse employees in a go-kart with you.
It's very, very funny if you haven't seen it. 25 million, I think, was the latest number. It's amazing. You released it on March 6, 2012.
Is there a reason why you picked that date or that time of year to release the video? Yes. So we were ready to launch. We had just raised about a million dollars in venture capital.
And how did you raise that money? You went around. So our first investor was a company called Science throughout Santa Monica. They gave us a $100,000 check.
Actually, they gave us a $100 check by accident first, and I got all the way to the bank. I literally, I got to the bank, and I was like, here's my check for $100,000. You had to fill out the foreign that said $100,000, and I fill it out, and the woman looks at me, and she's like, uh-uh-uh. But who were the, I mean, I have to assume there were some investors, or maybe many who looked at this idea and said, I'm not going to get into the raises, you know what I mean?
So what was the pitch that convinced those who agreed to, or who said, yeah, sure, I'll put it in a little seed money. Well, they saw the video. Before you released it. Correct.
So that was how you were able to convince those initial investors. Yep. They were like, well, you want to do this? And then they were the first ones that said all that stuff about, and there's no way you can do it.
And then I said, how are you going to do it? And I was like, well, I'm going to build a brand. And they're like, yeah, but what do you mean? And I was like, well, then I tried to explain.
I was like, you know what, just watch this. You said, just watch this video. Yeah. And instantly, many of them laughed.
I was funny. And that was creative. And I obviously believed in you. Yeah.
And they were like, sure, I'll give you a hundred bucks. All right. So you raised the seed money. March 6, 2012.
Why was that date or that time of year significant? So I'd spent time in the media. I knew how the media would think about using a video like this to tell the story of our funding. And so I wanted to make sure that we announced our funding at the same day that we launched the video.
We also chose that date because there was a nice lull right before South by Southwest. People get really excited right before South by Southwest, or at least they did then. They look for a big tech story. They hope something's going to break the way Twitter did in 2006 or whatever when, you know, and that was when Twitter kind of had its big moment, was at South by and it became a thing.
So there's a lot of anticipation in the air and people are looking for something exciting in the tech space. So I wanted to do it before the festival, before that got. Because you thought there's not a whole lot of noise out there right now. And maybe this will get some traction if I do it in this window.
Yes. Exactly. So you guys put it out there. What happens?
What happens? You upload it to YouTube or? Upload it to YouTube. Turn the site on the night before.
And how do you get people to know about it or click on it? Were there journalists that you targeted? Were there people that you specifically went after? Yes.
So we had done a round of press to announce our million dollar seed round. And we talked to all the usual suspects, the tech crunches of the world, the Bloombergs, et cetera. And all the stories went live at the same time. And first, the tech ecosystem picked up on it.
And this video, which people found funny and engaging and also that it was promoting a real business, was sort of a unique combination for people. I don't think there were too many examples at that time of a direct-to-consumer business that launched with a video that was funny and good. And I think that that tech community surfaced it and then from there it sort of caught wildfire. And what happened to you?
I mean, that day, the sixth. I mean, were you surprised? Were you, I mean, because a lot of people watched that video. Yeah.
I, you never build anything like that and think it's going to go viral. Anybody that tells you that they can build you a viral video or don't believe them. I did not have huge hopes for this video. I just thought that this was a really compelling way to tell the story of what our business was.
And we launched it. And I woke up at my normal times, 630 on March 6th. And I looked at the site and the site wasn't there. And I was like, oh my God, what's wrong?
Why is the site not live? We should be live. And some of my friends that were up on the East Coast earlier, they were like, you know, dude, amazing video. Like, but the site, I can't order my razors.
And you know, you're sitting there. And I'm literally in bed. And every entrepreneur has had a moment like this or 100 moments like this where they look at their phone first thing in the morning and they're like, oh, whatever. And that was one of them.
So decided to crash. I had to go figure out how to get the site back up online. Eventually we did. And then we sold out.
And these are the, these are the, these are the still the razors from our hoodies warehouse. Yeah, yeah. So you, you cleared that warehouse. Yeah.
We had some other, we had some other razors as well. We had, we had some twin razors. The first razors were twins. Then we had some four blades.
And we had some six blades. So we actually had, but all they all sold out. And so they sell out. And you know, you're, now you're like, what do I do?
What do I, what do I do in this moment? Do I, you know, pull down the clothes shade and say, sorry, like we'll be back in a couple months, unless we can make more razors or do I, we keep selling, put up a note that says, Hey, you know, we're going to sell these razors to you in advance, we're going to keep your money and eventually, eventually we'll send you these razors and people, thankfully, you know, we're okay with that. People, some people did. We're very transparent about the fact that there was a delay in the razors, but you know, they, they hung around because, because the proposition was resonant and we actually had tapped into something.
We had solved a problem that many, many people had. And we did it in a way that resonated with them and they wanted to give us a chance. At this point, Dollar Shave Club is still you and anyone else? At that point, it was, so, so science was our first investor and we had, I was the only full-time employee at that time, but science had a studio of folks, they had some designers.
Then there was a tech team that was a third party tech shop that did all of our engineering, but I was the only full-time employee. Yeah. And where were you sourcing your razors from? Manufacturing in South Korea.
And usually, you see these ads, right, for Gillette or whatever razors it is and they talk about this incredible technology as if it's like, you know, something that NASA invented. If Gillette was selling, you know, a four-pack of razors, let's say, for four or five times the cost that you were offering, which was a dollar plus two dollars for shipping and handling, I have to assume that you were, this was a lost leader, that you were not going to make money off this for a while. On that twin razor? No.
On the other ones, yes. And so, explain why, I mean, we've talked to the guys who founded Warby Parker and they explain why frames were so expensive because it was essentially a monopoly and they said there's no reason. Was it the same with razors? Like, why were razors that you could buy at a pharmacy so much more expensive than the ones you were selling?
Right. Well, you know, if you think about, it's a very small community. There are not that many people in the world that make great razors. And you think about the science that's involved.
For such an old-school sort of product, it's been around for a long period of time. There's an extraordinary amount of science that goes into taking raw metal, then thinning it out, then creating a blade edge, then coding a blade edge, you know, that can actually slice hair off your face and not skin off your face. There's a lot that goes into it. You can do it.
People do it. And so, but it's hard. And that's why there's not that many people that do it. How were you fulfilling those, those orders in that after the video came out?
Was it like you and a few people like packaging them up and? Yeah, we had printers. We had a couple of printers hanging around the office and, you know, we were running labels and, you know, it was so frustrating because we had thousands and thousands of orders and this label printer's like, so, like, the only answer is get more label printers. So, certainly we had these label printers and, you know, we're filling out these rolls of labels and then we put them in these big trash bags and we drive them down to the warehouse where we shot the video.
And that was doing our fulfillment center. And this was not any commercial fulfillment center. This is a place that, like, on Monday, they're filling, like, windshield washer pellets into tubes. On Tuesday, they're putting vodka bottles in crates and on Wednesday, they're filling orders for Dollar Shave Club and, like, whatever.
So, we have to go over there, take the big bag of labels and the big trash bag, throw them over the fence and hope that in the middle of the night nobody comes by and steals the big bag of rolled labels, which would be crazy if they did that, but, but that's, yeah, that was how the operation worked. When we come back after a quick break, Dollar Shave Club expands beyond just razors and how that expansion put them on Unilever's radar for an acquisition offer. Stay with us. I'm Guy Ros and you're listening to How I Built This.
Hey, welcome back to How I Built This. I'm Guy Ros. So Dollar Shave Club launched in 2012 with a viral video that got lots of attention and demand was overwhelming. But even with all of the momentum, Michael says raising money to scale the business was still a challenge.
Raising money has never been easy for us. And I think for, unless you're Snapchat, circa 2000, whatever, you know, it's hard to raise money for any kind of company. And for all the reasons that you pointed out in the beginning, you know, how do you think that you are going to, you know, take on these giants that have been doing this for, you know, over 50 years? And aren't they going to squash you?
Aren't they going to copy you? And so it was never easy for us. Yes. There was always, you can always raise some money from some portion of the market.
And the people that you want to raise money from, the smart money, so to speak, the smart money asks the smart questions. And they ask all the questions that they should. And it was never easy for us. Even, you know, into our series D.
You know, once you start to gain traction, obviously competitors came in, Harry's razors, for example, did that make you nervous when you started to see other people who were also using the subscription model? Yeah. I mean, I think, of course, anytime that you create something and you put it out there and it's naive to think that people aren't going to copy your great idea. And I think that your first reaction is to be like, oh, but I think what you learn over time is that the presence of competition pushes you to define yourself more specifically and focuses you on the things that you want to do.
And you know, definitely makes you work a little bit harder. So, you know, most people when they first start a company and then they experience competition, don't think that's a good thing. I think it's a wonderful thing. We've benefited from that in some ways.
It's been validating in so many ways, too. Did you have to do a whole lot of advertising over those viral videos because you went on to produce more? Was that really driving the customers? Was that bringing in new customers?
So, the virality were off at a certain point, for sure. And then it was, you know, jump into the paid marketing game, paid advertising game. And yeah, we shot our first television commercials, I believe, in 2013. We did another video for our One-Wipe Charlie's, which is our Butt-Wipe for Men.
Butt-Wipe for Men. Do you want to talk about that? Well, I mean, sure. It was 2013.
You decided to expand and to diversify. The side to diversify our first expansion was One-Wipe Charlie's. It's a Butt-Wipe for Men. It's a moist towel that you use.
Some people like to mop before they sweep. Some people like to sweep before they mop. It's a better way to do it. Unless you're very flexible, you're not spending any time back there, but other people that care about you might be.
And so, that might be a service that you provide, not for yourself, but for your loved ones. A couple of things happened to you guys that are not surprising because it happens to successful startups. The first is the big players got into the game. They got into the subscription game, the Gillette's and the other companies.
They are much bigger. That time, certainly, were much, much bigger in terms of the capital they had, the cash, the marketing dollars they had. Was there ever a concern when they got into that game that they could actually crush you? Any smart entrepreneur, any smart CEO or business person should absolutely be afraid of that type of thing when something like that happens, and you should be doing the chess on how to make that not happen.
So, yes, of course, when any competitor launches and many have, you have to think, how are we going to be different? How are we going to fend this off? If you don't take competitive threats seriously, that's foolish. So, we absolutely took it seriously.
The other thing, of course, is that Gillette sued you for patent infringement as you began to take away market share from Gillette. It's still pending, but did that lawsuit freak you out when that happened? Well, yes and no. I mean, it was the first time, I think, that we had gotten sued, and the first time he had sued, you're like, how do you react to something like that?
But I think at a certain point, people have been telling us along the way to expect that, because that's a playbook that big competitors, big incumbent competitors can do, to make you look unattractive to capital, to make you look unattractive to potential acquires. And so, for me, you take everything very seriously as a CEO, but you also say that there was a business calculation to it, also, that made a lot of sense from their side. So, you put it all together and rationalize it that way. So, you guys, I think at a certain point, maybe it was 2015, by 2015 or 2016, you get about three million subscribers.
Do you remember what percentage of the subscription market you guys had at that point? Of the online razor subscription market? I mean, most of it, at that point. Well, I won't know the exact market share numbers off the top of my head, but I think that, you know, as of now, there's about 20 to 25% of the men's non-disposable razor market that we have.
Do you remember when you became profitable? No comment. We're owned by a very big company, and we're not allowed to disclose your financial information. All right, so let's talk about that.
2016 Dollar Shave Club was acquired by Unilever, reportedly for $8 billion. Okay? I mean, that's a mind-boggling, a astounding amount of money. Were you looking to sell or did they come to you?
How did that happen? So, I met one of their executives at a dinner in New York, and we just started talking about where I wanted to take the company, and he was telling me about some of the things that Unilever was working on, and that men's grooming was a big priority for them strategically, and the conversation really just started out as a, hey, is there a way that we can potentially help each other? And the conversation took another step and then another step, and then we ended up with the acquisition. I know that there was a lot that preceded the founding of the company, and there was a lot that went into it, and a lot of stress and hard work, but just to put it in perspective, I'm talking about a five-year period.
From the time you founded it, to the time you don't even ever bought it, I mean, when you think about that, are you astounded at that? Are you, I mean, do you just think, God, five years, and this is what we built? I mean, it is pretty mind-boggling. It is mind-boggling.
It was a huge moment in the company's life and history, and certainly a huge moment in my life and career, no doubt, but I knew that all the hard work was really yet to come. The acquisition, in and of itself, is a nice moment and an acknowledgement of the progress that we made, but there was still so much to do that, you know, I didn't spend a lot of time sitting around being like, you know, popping a lot of champagne bottles, because it's just... You still run the company, you're the CEO. Correct.
You work for Unilever. I'm trying to think where I get my paycheck from, but yeah, more or less, I mean, yes, my boss is Unilever. For all the people here tonight who might be in your position in 2010 or 2011, who might be starting something up, or, you know, if you were in this audience then and you were watching somebody like you, what do you wish you knew then that you know now that would have been helpful? I think there's a lot of times when you're starting a company and you're faced with certain death or near death, you have a near death experience, which will happen a lot.
It's never as bad as you think. It's also not as great as you hope it will be, either. And you know, yes, there are some times when the worst possible outcome happens, but it's really rare. And you go through enough sort of crises and near death experiences and you come out on the other side and you kind of like, in your mind, you said yourself, okay, I know what it's like to be chill on the other side of the crisis.
I'm just going to put myself there and know that like eight out of ten times, it'll be true. And two out of ten times, it's not. And it helps you, I think, get a little bit less scared because starting a business is scary. Yeah.
Michael, this is a question that I ask everybody who comes on the show and if you've heard the show, you've heard the question. I'm curious from your point of view, how much of what happened to you do you think is because of luck and how much you think is because of your hard work and your intelligence and your skill? I think that anybody that's successful in business has benefited from luck. And anybody that tells you that they haven't or don't is not being truthful.
Luck plays a role in everything. And I think that you continue to get lucky throughout your career and throughout our business. You know, we've gotten lucky in many ways. Sometimes good luck is a manifestation of hard work.
And sometimes luck is just luck. I like to think that a lot of other people who met Mark Levine at that party that night, you know, would not have done what I did with it. What we have all done with it because this is not a one man show, never has been. But yeah.
Luck is important. Michael Dubin, founder of Dollar Shave Club. That's Michael Dubin. He's the co-founder of Dollar Shave Club.
This live interview was originally recorded at the theater at Ace Hotel in Los Angeles back in 2018. Michael stepped down as CEO of Dollar Shave Club in 2021. And since then, he's been involved in advising and investing in other startups and he's also written a screenplay. A few months ago, Michael also came back on the show as a guest on a how I built this advice line.
He joined me to take questions from a few early-stage entrepreneurs and gave them some really awesome and hilarious advice. So you should check it out. Thanks so much for listening to the show this week. Please make sure to click the follow button on your podcast app so you never miss a new episode of the show.
And if you're interested in insights, ideas, and lessons from some of the world's greatest entrepreneurs, sign up for my newsletter at GuyRaws.com or on Substack. This episode is produced by Casey Herman with Music Composed by Romtina or Louis. Our production staff also includes Neva Grant, Katherine Seifer, Jayce Howard, Sam Paulson, Chris Messini, Alex Chung, Kerry Thompson, John Isabella, Andrea Bruce, Romelwood, and Elaine Coates. I'm GuyRaws, and you've been listening to How I Built This and Don't Stop the Podcast Just Yet!
Because right now, you're about to hear an amazing, small business story that you don't want to miss. This segment is presented by American Express, with a business platinum membership the best just got even better. Today's story begins in Hollywood where husband and wife Floyd and Julia all the first met. At the time, Floyd was a production designer for TV and film, and Julia was a photographer.
Floyd and Julia built a life and a family together in LA, but in 2018, Floyd went up to Mill Valley, California to shoot a commercial, and he fell in love with the natural beauty in small-town field. We were shooting on top of Mount Town every morning at 6am, it was like walking into heaven every day. And then at night, I would see this incredibly charming town with 10 or 11-year-olds going out to the movies by themselves at night. I'd never seen anything like that.
He came home with like, we're moving to Mill Valley, and I was like, we're not moving to Mill Valley. But it turns out, Julia was ready for a change as well. So they decided to make the move. Floyd figured he'd get enough work as one of the few production designers in the Bay Area.
That was sort of the logic. I'd like to say my plan of moving up your field, I've done one commercial up here in seven years. Yeah, that part didn't work. What did work was their idea for a home goods store in Mill Valley's downtown?
It was going to be a side hustle. Like, oh, we'll just open this little concept store. They focus on modern and minimalist designs and sell a little bit of everything. A little apothecary, a little jewelry.
Plus furniture, which for Julia, had actually become a health concern. So I have an auto-immune issue, and I'm really sensitive to the chemicals, like I walk into its stores and sometimes overwhelmed by the amount of plastics, and I have travel breathing and I get hives around my neck. I just wanted some furniture that didn't make me sick. So Floyd and Julia traveled around the world and started sourcing furniture made from natural materials.
And by the end of 2018, prevalent projects opened up its brick and mortar store in downtown Mill Valley. Pretty soon after, Floyd spotted another opportunity. Because he'd built sets all around the world, why not offer interior design services as well? One of our first, like, real clients came in and somehow gave us a giant project to do in Hawaii.
It turns out they are people from the tech industry who've done quite well. They had cashed out. They worked 35-year-old billionaires and just gave us the opportunity of a lifetime. And it floated us through the next couple years.
And through another chance meeting, they connected with a partner who wants to expand their brand across the country. We're looking for a second location now, trying to figure out where to land in Silicon Valley somewhere, possibly L.A., interested in New York, interested in Colorado, interested in Seattle. All this from a decision to pick up and move to a new place, a place that gave them new energy, even as they worked a hundred-hour weeks. We just, until your eyes are bleeding, like working as hard and fast as you could at a certain point during the day, we'd just grab her and go, come on, we'd walk out in front door, right up into the most beautiful, old-growth, redly forest, and it would just be like a bath for like 20 minutes.
So just breathe all that oxygenated air and then get back at it. But Floyd and Julia Albie, co-founders of prevalent projects, their story was presented by American Express. To build a business like no other, you need a card like no other. There's nothing like business platinum.