Dollar Shave Club introduced guys to razor subscriptions and tried to make butt wipes a thing. Now it has more money, and says it will use it to get men using more stuff bearing its brand.
The online seller of razors and other men’s grooming products has landed a $75 million round, just nine months after it announced a $50 million funding round. Dollar Shave Club says it has now raised nearly $150 million in equity; a person familiar with the deal says the new investment values the company at more than $500 million pre-money.
CEO Michael Dubin declined to comment on the valuation.
Existing investors participating in the new funding included Venrock, TCV and Forerunner Ventures. Dragoneer, a growth-stage investment firm that has backed Instacart, Wealthfront and Airbnb, was a new investor in the round. Dollar Shave Club says it also received money from at least one “strategic investor,” though Dubin wouldn’t identify the investor.
The Venice, Calif-based company launched in 2012 with a hit promotional video starring Dubin that has been viewed more than 19 million times. Since then, the company has mixed smart social-media campaigns with traditional TV advertising to build a real business.
The company generated $19 million in revenue in 2013, $64 million in 2014, and is projecting at least $140 million this year, Dubin said. It now has more than two million subscribers, who receive razor blade shipments every month or every other month. But it is not profitable. (Correction: An earlier version of this story incorrectly reported that the company is profitable.)
While Dollar Shave Club is best known for razors, it has been adding new products to its portfolio over the last couple of years. They include shaving cream, wet wipes for the derrière and, most recently, a line of hair-styling products. Dubin said 40 percent of its subscribers have purchased at least one non-razor product.
Some of the new money will go toward hiring staff to add to its 120-person team. Some will go to develop new products that will launch in the coming year. And a chunk will be used to market the existing non-razor products in a big way, as the company has done with its razor subscriptions.
“Today, you’ve seen a lot of creative communication from us around the core business,” Dubin said in an interview. “It’s fair to expect more around our larger grooming principal over the next 12 months.”
The diversification is smart, and probably a must. While Dollar Shave Club more or less introduced the razor subscription business, it now has several well-funded competitors. Gillette introduced Gillette Shave Club last year and has been paying celebrities such as Giants quarterback Eli Manning to promote it this month ahead of Father’s Day, a popular holiday for shaving-related gifts.
“We’re certainly flattered by the name,” Dubin said of the Gillette offering, “but it’s too early to tell what the impact could be.”
Another competitor, a startup called Harry’s, has raised more than $200 million and has bought a German factory to make sure it would always have access to the razors it markets under its brand name. Dollar Shave Club, on the other hand, procures its blades from a South Korean manufacturer called Dorco, which has an ownership stake in Dubin’s company. Dubin declined to comment on the relationship.
There’s also Bevel, another young shaving brand from a startup called Walker & Company, which sells shaving kits geared toward eliminating razor burn for men of color.
Dubin claims Dollar Shave Club accounts for 7 percent of all razor cartridge sales in the U.S.
Beyond its non-shaving products, Dollar Shave Club is also cooking up a new way to differentiate. The company has hired several journalists to write lifestyle content geared toward men and is considering launching a standalone media property to deepen its connection with its target audience.
I had heard the media property has been rumored to carry the name The Shvitz, but Dubin said that would most likely not be the name at launch.
“That’s more of a code name.”
This article originally appeared on Recode.net.