With its $1bn acquisition of Dollar Shave Club, Unilever has simultaneously created a unicorn and demonstrated that digital-first, single product companies are serious acquisition targets for established consumer giants.
Dollar Shave Club is a great example of how new brands can be rewarded for staying tightly focused. Much of the company's early growth came from a single product which really connected with their target audience. Over time they've slightly broadened the product range to other mens wash products, but I'd still say it's all about the razor.
The interesting thing for me in the acquisition is the additional value that Unilever must believe it can leverage from owning Dollar Shave Club. The quote below highlights the customer data that Unilever will be getting their hands on, allowing them to cross-sell some of its existing set of brands to Dollar Shave Club's customers and vice-versa.
If I was the founder of a new brand, starting off with a single product tightly focused on the right audience, I'd take this acquisition as a positive sign that it's worth the struggle, and the reward can be large.
While best known for its shaving service, the company also produces mens wash, skincare, and and styling products. Unilever will also benefit from Dollar Shave Club’s valuable customer data and existing customer base.