Unilever Sells Dollar Shave Club to a Private Equity Firm
The consumer packaged goods conglomerate Unilever announced the sale of Dollar Shave Club to a private equity firm, Nexus Capital Management LP, whose portfolio includes the shoe brand Toms, the plant-based food and beverage brand TruRoots, and the beauty supplement brand Sugarbear, among others. Unilever, based in London, will retain a minority interest of 35 percent. The sale comes about seven years after Unilever purchased the Marina Del Rey, California-based men's grooming company for a reported $1 billion in 2016. That year, Dollar Shave Club hit $225 million in sales.
Total Retail's Take: This action by Unilever doesn't come as a surprise to industry analysts. Revenue for the CPG giant has been in decline, and Unilever's attempts to integrate Dollar Shave Club into its brand portfolio always seemed to be like trying to fit a square peg into a round hole. The direct-to-consumer brand gained widespread popularity and appeal thanks to its edgy and funny viral videos, which were created by its co-founder and former CEO Michael Dubin. That type of marketing didn't align with the rest of Unilver's consumer brands, such as Dove, Hellman's, Vaseline, etc. Dollar Shave Club was an outlier in the Unilever brand mix, and the parent organization never seemed to be the right platform to help the D2C startup take the next step in its growth trajectory. Therefore, Unilever cutting its losses and selling Dollar Shave Club to recoup some of its investment in the brand was a natural outcome.