How Michael Dubin Sold Dollar Shave Club For A Cool $1 Billion
Entrepreneur|April 2017

In five years, Michael Dubin turned a warehouse full of surplus razors into an industry-changing phenomenon. For the first time since selling his company for $1 billion, he talks in detail about how it happened—and why he’s only getting started.

Jaclyn Trop

Michael Dubin occasionally allowed himself to envision the moment when everything paid off. He’d be ushered into a grand ceremony, where some conglomerate, eager to own his massively successful company, would offer him a fortune for the pleasure. “I thought we would pass a really nice pen around in a wood-paneled boardroom with portraits of men with white hair,” he says.

When the moment actually came, on July 19, 2016, there was none of that. He was in his pajamas, lying on a bed at the Skytop Lodge in the Pocono Mountains of Pennsylvania. His lawyers had been working through the night, and now the sun was up and Dubin had his cellphone pressed to his ear. In two hours, he was set to take the stage in the hotel’s ballroom, where leaders of the multinational conglomerate Unilever would gather for its biannual conference. There, they’d announce that he was now part of their team: Dollar Shave Club was being acquired for $1 billion. But first, the deal had to be finalized. Dubin listened as, one by one, the executives on the phone gave their approval. Then it came down to him.

Today, Dubin swears he hadn’t been looking to sell the company so early. (He declines to say whether other offers had come along.) The way he saw it, his five-year-old Dollar Shave Club was only getting started. When he launched it in 2012, the razor market was dominated by Gillette, which claimed 72 percent of the U.S. market and had been purchased by Procter & Gamble for $57 billion in 2005. Schick was a distant second. But Dubin saw an opening. He could start by undercutting the big competitors on razors, and then build out something that felt less like a shaving supply company and more like a full-scale men’s club—a subscription-based grooming brand with personality, that men actually identify with.

“If anyone else had brought me the idea, I would have said, ‘Well, it’s a tough category with lots of global competitors,’” says venture capitalist Kirsten Green, founder of Silicon Valley–based Forerunner Ventures. But Dubin quickly convinced her to be one of his company’s early investors. Spend any time with Dubin and it’s easy to understand why. Tall, sandy-haired, and preppy, the 38-year-old entrepreneur can vacillate between guy’s-guy sarcasm and serious, intense shop talk. He’s also a voracious reader, giving every new employee copies of two of his favorite books: Thich Nhat Hanh’s How to Sit and Peter Drucker’s The Effective Executive. “Within the first 10 minutes of meeting Michael, I was completely drawn into his idea and vision and him,” Green says.

In the years that followed, Dollar Shave Club released a full range of products, made a name for itself with viral online videos, and produced the kind of growth rarely seen in the once sleepy category of men’s grooming. Other mail-order companies, such as Harry’s and ShaveMOB, entered the space, and Amazon got into the game as well. By 2015, four years after Dubin began, web sales for men’s shaving gear had more than doubled industry-wide, to $263 million—and the following year, Dollar Shave Club was the number one online razor company, with 51 percent of the market, compared with Gillette’s 21.2 percent, according to research firm Slice Intelligence. This clearly spooked the industry giant; Gillette launched its own Gillette Shave Club and bought promoted tweets to claim things like “two million guys and counting no longer buy from the other shave clubs.” But Dubin’s company kept growing, more than doubling its revenue every year since launching. It started with $6 million in 2012 and is on track for $200 million this year.

Still, the sale to Unilever was a detour from his initial roadmap. He hadn’t built Dollar Shave Club for a quick cash-out. He thought his company could become “a brand that sits on the shelf next to the Starbucks and the Nikes and the Red Bulls of the world,” he says, and he wanted to be the one to lead it there. That meant Dollar Shave Club must retain what made it special—its culture, its voice, and its free spirit. But would his 205 employees and three million–plus members, who were attracted to its lovable scrappiness, still feel that connection once the startup became part of a corporate giant? “I think it’s always a concern of a founder,” Dubin says. “The most important aspect of culture is how people feel about their role. You need clear financial and spiritual objectives and benefits. If you don’t get that right, it doesn’t matter how many beanbag chairs you have.”

The company’s open floor plan in a Los Angeles suburb doesn’t have beanbag chairs at all, actually, but it does have a strong culture of communal fun and a tireless work ethic: free lunch on Tuesday, events like bouquet making on Valentine’s Day, and Play- Station and Nintendo boxes beneath a neon sign in pink cursive that says GET BACK TO WORK. (“That’s a bit of our dry humor,” says spokeswoman Kristina Levsky.)

Unilever, however, promised that the company he built would stay the same—and he would have the financial freedom to truly achieve his vision. So in the hotel room, still in his pajamas, Dubin flipped open his laptop and brought up DocuSign. The $1 billion contract appeared in front of him. He clicked OK. Sale finalized. Then DocuSign’s standard message popped up: “You’re done signing. A copy of this document will be sent to your email address when completed by all signers. You can also download or print using the icons above.”

“I took a screenshot,” Dubin says, “because it was so unceremonious.”

A few hours later, as planned, Dubin went onstage to be introduced as Unilever’s newest leader. Then he and Unilever’s president of North American operations, Kees Kruythoff, flew to Los Angeles to tell Dollar Shave Club’s employees. As Dubin recalls, “He said, ‘Congratulations; you just bought Unilever,’ which was his way of saying it was important for us to maintain our culture.”

Dubin had taken the company this far. Now everyone looked to him to keep it going.

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