C (5:28)

All right, welcome, Michael.

B (5:31)

Thanks for having me.

C (5:32)

Is that actually true that on snow days your mom would make you solve math problems, or is that apocryphal?

B (5:37)

Yeah, we weren't allowed to. You know, it was like, you can have fun, but before you have fun, you're gonna 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.

C (5:49)

Yeah, you're like, I should be doing math problems.

B (5:51)

Yeah, exactly. Yeah, That's a good lesson. Do your work first, have fun later, maybe.

C (5:56)

Okay, so you grew up mainly, I guess, in the suburbs of Philadelphia.

A (6:00)

Yep.

C (6:00)

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?

B (6:13)

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, I Want to Live, and something like, I want to live the right to live my life. I don't know. I mean, it was really like. I'd love to see it.

C (6:44)

All right, 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 in general, academics? I mean, did you feel like you were a good student or did you become a good student?

B (6:56)

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.

C (7:19)

Good enough. I mean, you went to a pretty good school. You went to Emory University.

B (7:22)

I did.

C (7:23)

And you studied history there.

A (7:25)

I did. Right.

B (7:25)

I actually started out as a PolSci major, but I flunked PolSci 100, actually, twice. I flunked the same class twice in back to back years, which goes to show you what kind of a 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 love reading about history and studying history. So I actually did fairly well at 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 extracurricularly, I think, in college, and I Got really into those things and that helped set me on my career afterwards.

C (8:01)

So you graduated college and what did you do?

B (8:06)

So I became a page at the NBC page program.

C (8:08)

Like Kenneth Page, Correct?

B (8:10)

Exactly. But this was before Kenneth made the page program cool or not 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 seat the audiences for the shows, you give tours of the studios. And the trade off is that they give you an opportunity to take mini jobs in different departments. And so those mini jobs can be with Saturday Night Live or Nightly News or, you know, at that time, the Rosie o' Donnell show was still on. 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.

C (9:00)

So was that your idea that you would stay in journalism or media? Like, was that where you started to think, you know, this is what I'm.

A (9:09)

Maybe this what I'll do?

B (9:10)

Yeah, I was super passionate about it and went to work at NBC and then went to work at msnbc, first as a PA and as a writer. And I, 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 and a narrative. And then at 5pm right before your show would air, they would, you know, there would be some breaking news and all your work would get thrown out. And. And then I also felt like it was right around the time that I started thinking, like, I really want to be in marketing or advertising.

C (9:44)

And how did you, I mean, how.

A (9:46)

Did you make that leap?

C (9:47)

Had you been exposed to marketing and advertising, or did you just think this could be interesting?

B (9:53)

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 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 Time Inc. 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. Sportsillustrated.com and that work in general was. I built a. You know, back in the day, people might remember the term microsite. I built microsites for some of the big brand advertisers at Life and for Sports Illustrated. You know, those could have been for Gatorade or for Sega.

C (10:43)

And you were just learning how to do this on the job.

B (10:45)

Exactly.

C (10:46)

So, like you would build a micro website or make a video or something for these brands.

B (10:52)

Yep, 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 lay out 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.

C (11:29)

Yeah. All of this is happening in New York. You're 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?

B (11:44)

So I, I've always been passionate about comedy and I had 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. In the West Village? No, in Chelsea. And I was just, you know, I said, well, I want to do that.

C (12:06)

You know, and you could just sign up, just pay the fee and join.

B (12:08)

Yep, pay 300 bucks, take the entry level class and see how you do. And it just stuck. I fell totally in love with it. Before too long, I was taking sketch classes as well.

C (12:17)

And you do this like weekly or.

B (12:19)

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 9pm and it's, you know, a very bizarre experience.

C (12:35)

So you had, you had this marketing job during the day making Videos. And at night you were doing improv.

B (12:43)

And I was also trying to start my first startup, which was a social network for travelers. So, yes, I was busy.

C (12:48)

And what happened to the social network for travelers?

B (12:51)

Not much.

C (12:52)

Okay, I got you. Okay, so you had. You know. But I'm trying to understand. I mean, there must have been something about improv. Like, I have to imagine that 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?

B (13:07)

I would never admit that, but yes.

C (13:10)

Got it. Yeah, that's right. Because why would you take improv classes for years?

B (13:16)

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 a grocery store, and you're watching six to 10 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 setup, 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 grinded by your boss at work, and, you know, you're trying to start this social network for travelers in the margins. And, you know, then it's like, you know, you could go to the gym, or you can go just completely blow your mind and do some improv.

C (14:23)

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?

B (14:31)

No.

C (14:32)

Wow. Because right today, you would think, okay, in your 20s, do some improv, learn marketing. And then you'll be, yeah, right.

B (14:38)

Then I'll sell razors on the Internet. Yeah.

C (14:48)

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.

A (15:06)

What?

B (15:06)

Yeah. Well, I got laid Off. So that's like a lot of people. There's no hero story there.

A (15:13)

Okay.

B (15:13)

You know, 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 had 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 got nothing to lose.

C (15:36)

So no plan, no job. You just came out here.

B (15:39)

No plan, no job. Just came out here.

A (15:41)

And what did you.

C (15:42)

What did you start to do?

B (15:43)

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.

C (15:59)

So similar, kind of similar to the work you're doing in New York.

B (16:02)

Very related 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.

C (16:11)

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.

B (16:24)

Yep.

C (16:25)

At this party. Who is Mark Levine? What's that party? What happens there?

B (16:30)

So Mark Levine is my friend's father. He's a businessman. He's had a successful career in South Africa, then came to the United States, you know, and he was an importer. He's like our family friend who would show up sometimes with, like, you know, a truck full of soccer balls or like 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. Yeah. So, yeah, we'd been trying to get connected for a while because he had heard that I had worked in, you know, 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, you know, unload.

C (17:18)

Like, when you say stuff, like, he would just import whatever stuff.

B (17:22)

Well, the two things that he approached me about were he was like, I've got razors. I got about 250,000 razors. Okay. He also had a couple thousand cake slicers.

C (17:38)

Cake slicers in a warehouse?

B (17:40)

Yeah. So the cake slicers were called piece of cake. The slicer themselves was shaped like a wedge piece of cake. And so, you know, forget about the worry of having to slice twice when you want a piece of cake. Now you sliced it, you take your piece of cake, and you put it over the cake.

C (18:01)

Wow.

B (18:01)

And out comes the perfect slice of cake.

C (18:04)

I need to know why we are not talking about Dollar Cake Club.

A (18:09)

How was that?

C (18:13)

How was that not the product that you said to Mark? Oh, my God.

A (18:17)

Amazing.

C (18:18)

The cake slicer. Yeah, I'm in.

B (18:20)

I just. I knew that, you know, gluten free was gonna be the next thing, and I just wasn't gonna be a market for it.

C (18:29)

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.

A (18:36)

Are you in?

C (18:37)

Is that what he said?

B (18:39)

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.

C (18:45)

So what happens? Like, you go home and then you call him and say, okay, I want to go check out these razors.

B (18:50)

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 Duane Reade 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. And you actually feel like you're inconveniencing them for, you know, helping you get a product. It's the only product that's like that or one of the only products that's like that in the store. And I didn't, in 2006, 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.

C (19:41)

All right, so you go. And you. What? You. You go check out this warehouse.

B (19:45)

So the razors are in a warehouse in San Bernardino or Rancho Cucamongo, 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, you know, 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. You got to go get me $700. Or I'm. These razors. I'm about to throw these razors out. So the razors had been there for so long, and the bill hadn't been paid. Like, I'm sure that Mark Levine had gotten the rental space. Like, 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.

C (20:25)

So you go in, you see the.

B (20:26)

Razors, and I 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.

A (20:35)

Wow.

C (20:36)

So you get home and you call him and you say, hey, I think I can sell these. And he says, great. Go knock yourself out.

B (20:44)

More or less. Yeah. He was like, what do you want to do with them? And I was like, 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.

A (20:58)

Yeah.

C (20:59)

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?

B (21:18)

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 were experiencing that same frustration, and I knew that there was an opportunity. And 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, you know, make a couple bucks.

C (22:10)

And what about the name?

A (22:12)

How did you.

C (22:12)

Was the name also part of the idea? From within a few days of meeting.

B (22:17)

Mark, I wanted the function of the business to come through in the name. And I think if you 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. Yeah.

C (22:33)

So 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, Schick, did anybody, your family or anybody say to you, like, razors? This is like, this market is dominated by like two or three companies.

B (23:00)

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, his Rancho Cucamongo razors 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.

C (23:49)

Yeah.

B (23:49)

Because it would have sounded crazy.

A (23:53)

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 Built. Hey, welcome back to How I Built this. I'm Guy Raz. So it's around 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.

B (24:55)

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 have 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?

C (25:30)

So, all right, so in that first year, you were really kind of seeing if people would get to the site, seeing what. What they were buying. How did you even reach people so early? Like, by Google Ads and things like that?

B (25:43)

Yeah, we did a Groupon. 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.

C (26:03)

He just found you online.

B (26:05)

He just found us online. 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, yeah, you know, like, 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.

C (26:33)

Yeah. So obviously, at a certain point, and this really comes to a head in March, I think the date was March 6, 2012, your background in video and your background in improv magically come together unplanned when you release a video. What was the story about that video? How did that come about? Yeah.

B (26:55)

So I knew that this was a fairly simple story. Razors 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 humor 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 and director of. Of Broad City Now. But she was.

C (27:26)

You met her at the. At the.

B (27:28)

I met her. She directed one of the shows that I was in at one point. So, yeah, I met her as part of that community.

C (27:34)

And you asked her to help you with this video.

B (27:35)

I said she had 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 homepage. Like, you know, I wrote a script. Will you meet me for coffee? And, like, give me notes on the script and then help me film it? So we met for coffee. Coffee. She looks at the script. She says, I really like it. Added a couple 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 I actually owe that, owe that to Lucia. And we rented out the warehouse that we were fulfilling packages in, out for the day. That background that you see, I mean, they fulfill all kinds of crazy stuff over the years, by the way, for.

C (28:16)

People who haven't seen it, which is it's you sitting, 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 in someone 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. Was there a reason why you picked that date or that time of year to release the video?

B (28:52)

Yeah, so we were ready to launch. We had just raised about a million dollars in venture capital.

C (28:58)

And how did you raise that money? You went around.

B (29:01)

And so our first investor was a company called Science. They're out in Santa Monica. They gave us $100,000 check. Actually, no, they gave us a hundred dollar 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 form that said $100,000. And I fill it out and the woman looks at me and she's like.

C (29:25)

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 razor plenty. Right. So what was the pitch that convinced those who agreed to, or who, you know, who said, yeah, sure, I'll put in a little seed money.

B (29:40)

Well, they saw the video before you released it. Correct.

C (29:43)

So that was how you were able to convince those initial investors.

B (29:47)

Yep. They were like, well, you want to do this? And then they were the first ones that said all that stuff about there's no way you can do it. And then I said, how you. They're like, 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. And I tried to explain. I was like, you know what? Just watch this.

C (30:02)

You said, just watch this video.

B (30:03)

Yeah.

C (30:04)

And instantly many of them laughed that it was funny and thought it was creative and obviously believed in you. Yeah.

B (30:09)

And they were like, sure, I'll give you 100 bucks.

A (30:11)

All right.

C (30:14)

So you, you raised the seed money March 6, 2012. Why was that date or that time of year significant?

B (30:21)

So I had 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 gonna 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 noisy, because.

C (31:04)

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.

B (31:11)

Yes, exactly.

C (31:13)

So you guys put it out there. What happens? You upload it to YouTube or upload.

B (31:19)

It to YouTube, turn the site on late the night before, and how do.

C (31:25)

You get people to know about it? Or click on. Were there journalists that you targeted? Were there people that you specifically went after?

B (31:32)

Yeah. So we had done a round of press, you know, 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.

C (32:14)

And what happened to, I mean, that, that day, the sixth, I mean, were you surprised? Were you sure? I mean, because a lot of people watch that video.

B (32:25)

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, 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, you know, we. I woke up at my, you know, normal time is 6:30 on March 6, 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? Like we should be live? And I saw some text messages 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 a hundred moments like this where they look at their phone first thing in the morning and they're like, oh shit, whatever. And that was one of them. So the site had crashed. I had to go figure out how to get the site back up online. Eventually we did, and then we sold out. And the Vlad.

C (33:28)

These are, these are still the razors from Mark Levine's warehouse.

B (33:31)

Yeah, yeah.

C (33:31)

So you, you cleared that warehouse?

B (33:34)

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, then 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 closed shade and say, sorry, like, we'll be back in a couple months? What, we can make more razors? Or do 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 were okay with that. I mean, some people did. We were very transparent about the fact that there was a delay in the razors. But you know, they hung around 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.

C (34:33)

At this point, dollar Shave Club was still you and anyone else at that point.

B (34:39)

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. A third party tech shop that did all of our engineering, but I was the only full time employee.

A (34:57)

Yeah.

C (34:58)

And where were you sourcing your razors from?

B (35:00)

So a manufacturer in South Korea.

C (35:02)

And here's the thing, you see these ads, right, for Gillette or whatever razor it is, and they talk about this incredible technology as if it's like something that NASA invented. If Gillette was selling a four pack of razors, let's say for four or five times the cost that you were offering, which was $1 plus $2 for shipping and handling, I have to assume that this was a loss leader, that you were not going to make money off this for a while.

B (35:31)

On that twin razor? No, on the other ones, yes.

C (35:35)

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. Why is it, was it the same with razors? Like why, why were razors that you could buy at a, at a pharmacy so much more expensive than the ones you were selling?

B (35:57)

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 that'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 coating a blade edge that can actually slice hair off your face and not slice 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.

C (36:33)

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.

B (36:41)

Yeah, we had printers, we had a couple 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 at a certain point, 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 an E commerce fulfillment center. This is a place that, like, on Monday, they're filling, like, windshield washer pellets into tubes. On Tuesday, they're putting. 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 in a 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 that's. Yeah, that was how the operation worked.

A (37:43)

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.

C (37:53)

Stay with us.

A (37:54)

I'm Guy Raz, and you're listening to How I Built this. Hey, welcome back to How I Built this. I'm Guy Raz. 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.

B (38:26)

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, but the people that you want to raise money from, the smart money, so to speak, the smart money asks the smart questions. And they asked all the questions that they should, and it was never easy for us. Even, you know, into our Series D.

C (39:09)

You know, once you started 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.

B (39:22)

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 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 valid in so many ways too.

C (40:04)

Did you have to do a whole lot of advertising or were those viral videos because you went on to produce more, was that really driving the customers? Was that bringing in new customers?

B (40:14)

Yes, the virality wore 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 2003. 13. We did another video for our One Wipe Charlie's, which is our butt wipe for men.

C (40:32)

Butt wipe for men. Do you want to talk about that?

B (40:36)

Well, I mean, sure.

C (40:37)

This is 2013. You decided to expand and to diversify.

B (40:42)

Decided to diversify. Our first expansion was One Wipe Charlie's. It's a butt wipe for men. It's a moist towelette 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. And you know, anybody, unless you're very flexible, you know, you're not spending any time back there. But other people that care about you might, might be. And so that might be a. That might be a service that you provide not for yourself, but for your loved ones.

C (41:29)

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 Gillettes and the other companies, they are much bigger. That time certainly were much, much bigger in terms of the capital they. They cash, the marketing dollars they had. Was there ever a concern when they got into that game that they could actually crush you?

B (42:03)

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. 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.

C (42:31)

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?

B (42:45)

Well, yes and no. I mean, you know, it was the first time, I think that we had gotten sued. And you know, your first. The first time you get sued, you're like, what do you, how do you react to something like that? So, but I think at a certain point, you people have been telling us along the way to expect that, because that's a playbook that big competitors, big incumbent competitors can do, you know, to make you look unattractive to capital, to make you look unattractive to potential acquirers. And so for me, you know, like, look, 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.

C (43:33)

So you guys, I think at a certain point, Maybe it was 20, 2015. By 2015 or 2016, I think you had about 3 million subscribers. Do you remember what percentage of the subscription market you guys had at that.

B (43:45)

Point of the online Razer subscription market? I mean, most, most of it at that point.

A (43:51)

Wow.

B (43:51)

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.

C (44:06)

Do you remember when you became profitable?

B (44:10)

No comment. We're owned by a very big company and we're not allowed to disclose financial information.

C (44:16)

All right, so let's talk about that 2016. Dollar Shave Club was acquired by Unilever reportedly for a billion dollars. Okay. I mean, it's a mind boggling, astounding amount of money. Were you looking to sell or did they come to you? How did that happen?

B (44:36)

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.

C (45:03)

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 into perspective, we're talking about a five year period from the time you founded it to the time Unilever bought it. I mean, when you think about that, are you astounded at that? Are you?

A (45:24)

I mean, do you.

C (45:25)

Do you just think, God, five years and this is what we built? I mean, it is pretty mind boggling.

B (45:32)

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 there's just. It's just.

C (46:02)

You still run the company. You're the CEO, correct? You work for Unilever.

B (46:08)

I'm trying to think where I get my paycheck from, but, yeah, more or less, yeah. I mean, yes, my boss is Unilever.

C (46:16)

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.

A (46:28)

Wish you knew then that you know.

C (46:30)

Now that would have been helpful.

B (46:34)

I think there's a lot of times when you is 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 say to yourself, okay, I know what it's like to be chill on the other side of the crisis. I'm just gonna put myself there and know that like 8 out of 10 times it'll be true and 2 out of 10 times it's not. And it helps you, I think, get a little bit less scared because starting a business is scary.

A (47:27)

Yeah.

C (47:28)

Michael, this is a question that I ask everybody who comes on the show. And if you've heard the show, you've heard me ask a question. But 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 do you think is because of your hard work and your intelligence and your skill?

B (47:46)

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. It never has been. But yeah, luck is important.

C (48:35)

Michael Dubin, Founder of Dollar Shave Club.

A (48:42)

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 the How I Built this advice line. He joined me to take questions from a few early stage entrepreneurs and he 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@guyraz.com or on substack. This episode was produced by Casey Herman with music composed by Ramtin Arablouei. Our production staff also includes Neva Grant, Katherine Seifer, J.C. howard, Sam Paulson, Chris Messini, Alex Chung, Kerry Thompson, John Isabella, Andrea Bruce, Rommel Wood, and Elaine Coates. I'm Guy Raz 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 Albee 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 and small town feel.

D (50:33)

We were shooting on top of Mount Tam 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.

E (50:48)

He came home and was like, we're moving to Mill Valley. And I was like, we are not moving to Mill Valley.

C (50:52)

But it turns out Julia was ready.

A (50:54)

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.

D (51:03)

That was sort of the logic, I'd like to say. My plan of moving up here failed. I've done one commercial up here in seven years. Yeah, that part didn't work.

A (51:11)

What did work was their idea for a home goods store in Mill Valley's downtown.

D (51:16)

It was going to be a side hustle, like, oh, we'll just open this little concept store.

A (51:20)

They'd focus on modern and minimalist designs and sell a little bit of everything.

E (51:25)

A little apothecary, a little jewelry, plus.

A (51:27)

Furniture, which for Julia had actually become a health concern.

E (51:32)

So I have an autoimmune issue and I'm really sensitive to the chemicals. Like I walk into stores and sometimes I'm overwhelmed by the amount of plastics and I have trouble breathing and I get hives around my neck. I just wanted some furniture that didn't make me sick.

A (51:51)

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 in 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?

D (52:13)

One of our first like real clients came in and somehow gave us a giant project to do in Hawaii. Turns out they are people from the tech industry who've done quite well.

E (52:27)

They had cashed out. They were 35 year old billionaires and just gave us the opportunity of a lifetime. And it floated us through the next several years.

A (52:36)

And through another chance meeting, they connected with a partner who wants to expand their brand across the country.

D (52:42)

We're looking for a second location now. Trying to figure out where to land in Silicon Valley, somewhere possibly la. Interested in New York, Interested in Colorado? Interested in Seattle.

A (52:53)

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 100 hour weeks.

D (53:01)

We'd just be till your eyes are bleeding, like working as hard and fast as you could. And at a certain point during the day I would just grab her and go, come on. We'd walk out our front door right up into like the most beautiful old growth redwood forest and it would just be like a bath for like 20 minutes to just breathe all in all that oxygenated air and then get back at it.

A (53:20)

That's Floyd and Julia Albee, 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. If you like how I built this, you can listen early and ad free right now by joining Wondery plus in the Wondery app or on Apple Podcasts. Prime. Members can listen ad free on Amazon Music. Before you go, tell us about yourself by filling out a short survey@wondery.com survey.