Notes on Unilever’s Acquisition of Dollar Shave Club

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Executive QA - Notes on Unilever Acquisition of Dollar Shave Club

Unilever just purchased Dollar Shave Club for a reported $1B in cash. If the reports are true, this transaction would be the third largest buyout in e-commerce history (see: Zullily and Wayfair). Here are some notes to process:

  • Unilever is paying 4.2x projected revenue (~$238M).  Dollar Shave Club is not profitable, but the company had reached 15% US marketshare in men’s razor cartridges last year with $150M in revenue.
  • Venrock led Dollar Shave Club’s series A and series B rounds.  VC David Pakman wrote about the firm’s investment thesis, including this gem: “Choose categories where the CEOs of the incumbents are professional CEOs, not founders (thus are far less-likely to cannibalize existing businesses and adopt new business models).” 
  • Founder Mike Dubin will remain CEO, and Dollar Shave Club will operate as an independent business.

It will be interesting to see how this deal impacts the CPG space, as well as venture capital investment in non-tech consumer businesses.  In the meantime, watch Dollar Shave Club’s Youtube video again.