After the Viral V**eo

The Steep Learning Curve of an Ambitious Young Startup

written by Rachel Swaby
photography by Tamar Levine

 

When UCLA Anderson alumnus Kevin Datoo ('03) joined Dollar Shave Club in the spring of 2012, the startup was in the middle of what was either the most terrifying or the most exciting time in the nascent company's history. It started with a YouTube video (see video link above). On March 6, Michael Dubin, Dollar Shave Club's cofounder and CEO, posted a one-minute, 34-second clip online promoting the company. 

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"I always believed in the power of video to tell stories," says Dubin. He had studied improv with the Upright Citizens Brigade, a sketch comedy and improvisation troupe, while living in New York City a few years earlier, and he figured he could use his years of comedy training to start building the Dollar Shave Club brand.

The video opens as a pretty straightforward sales pitch. From behind a desk, Dubin explains that Dollar Shave Club is a subscription service that mails customers new razors every month for just a dollar. But about fifteen seconds in, there's a moment where the ad transforms from fairly mundane to infinitely forwardable. "Are the blades any good?" he asks, standing up and approaching the camera. "No." Then, he pauses briefly. A bright peach-colored sign appears on the left side of the screen. Just as the words come into focus, Dubin throws a thumb in the phrase's direction. "Our blades are f***ing great."

No razor burn! COO Kevin Datoo gets a close shave in our opening video sequence

Later, Dubin wields a machete and a leaf blower. By the end, he's dancing in a flurry of dollar bills in front of an American flag backdrop. Did I mention there's a bear costume? Dubin had nailed just the right amount of nuttiness to complement Dollar Shave Club's defining details.

The clip went viral, rapidly gaining several million views. "It crashed our site, and we sold out of inventory in about a week," recalls Dubin. They had just closed a million dollar round of funding, but the business's warehouse was cleaned out and wouldn't be replenished for another 6 to 8 weeks. "We had one full-time employee at the time, and that was me." Dollar Shave Club had done an expert job of building a brand, but they desperately needed help with the follow-through.

Here's where Datoo came in. Earlier that year, Dubin had taken his fledgling company through the LA-based incubator, Science. Science was launched by some ex-Myspacers who knew of Datoo through his previous post at Fox Interactive Media. When Dollar Shave Club was looking to hire another exec, the incubator recommended the UCLA Anderson alum. "Kevin came in at an extremely critical time," says Dubin. "Everything was very raw."

Because they had sold out of their inventory, most customers who signed up for regular razors were facing a nearly two-month delivery delay, which was significant considering Dollar Shave Club's pitch was for new blades in the mail monthly. "It turned from a marketing story to an operational challenge," says Datoo. So, while they thought hard about how to better brace for the future, Dollar Shave Club started sending out mea culpas. Thankfully, says Dubin, "people are pretty tolerant of startups trying to figure it out."

And figure it out, they did. At the beginning of 2013, Dollar Shave Club had scaled up to twenty full-time employees, from just one the year before. And in October, the company closed a $9.8 million round of funding led by the venture capital firm, Venrock.

With the influx of cash, Dubin and Datoo are aiming to move beyond just one-, six-, and nine-dollar razors into memberships that cover other bathroom needs. While they're shying away from specifics until an official unveiling in the spring, they're confident that Dollar Shave Club has cultivated a strong enough brand to branch out beyond the name.

Dubin hasn't starred in another video since the enthusiasm for his initial creation nearly took down the company, but a big announcement might be just the right time produce something f***ing great.