Dollar Shave Club, the firm that shook up the men’s shaving industry, has been bought by FMCG giant Unilever for a reported $1bn.
Neither Dollar Shave Club nor Unilever disclosed terms of the deal, but two sources familiar with the matter who were not authorized to discuss it said the privately held start-up’s shareholders will divvy up $1bn in cash.
Founded in 2012 and headquartered in California, Dollar Shave Club has grown into a full male grooming business that has transformed the shaving category with its lifestyle brand with 3.2 million members.
It first reached fame with an ‘Old Spice’ style viral video that challenged leading shaving brands with a new online subscription model:
In 2015, DSC had turnover of $152m and is on track to exceed $200m in turnover in 2016.
Unilever, which already owns personal care products including Axe, Dove and Pond’s, said in a statement Wednesday that Dollar Shave Club has “transformed the shaving category with its lifestyle brand” and has built a membership of 3.2 million since its establishment in 2012. The company had sales of $152 million in 2015.
“Dollar Shave Club is an innovative and disruptive male grooming brand with incredibly deep connections to its diverse and highly engaged consumers,” said Kees Kruythoff, President of Unilever North America. “In addition to its unique consumer and data insights, Dollar Shave Club is the category leader in its direct-to-consumer space. We plan to leverage the global strength of Unilever to support Dollar Shave Club in achieving its full potential in terms of offering and reach.”
Michael Dubin, founder and CEO of Dollar Shave Club, added: “DSC couldn’t be happier to have the world’s most innovative and progressive consumer-product company in our corner. We have long admired Unilever’s purpose-driven business leadership and its category expertise is unmatched. We are excited to be part of the family.”
Michael Dubin will continue to serve as CEO of Dollar Shave Club.
Dubin said the two sides had been talking for months about an investment. Those talks evolved into discussions about an acquisition after Dubin acknowledged how Unilever could help Dollar Shave Club grow into a global brand, beyond its current operations in U.S., Canada and Australia. Dollar Shave Club will remain largely independent to build its brand.
The company is currently locked in a lawsuit with rival Gillette, which started its own online subscription service in 2014. Gillette, which is owned by Procter & Gamble, alleges Dollar Shave Club stole one of its patents to reduce wear and tear on its razor blades.
Dubin declined to comment on the lawsuit and whether it had an effect on the sale to Unilever.
Subject to regulatory approval, the transaction is expected to close during the third quarter.