On Tuesday, Harry’s, a men’s grooming brand and arch rival of Dollar Shave Club, announced it securing $75.6 million in a Series C funding round led by Wellington Management. This funding raises the company’s valuation to $750 million.
New York-based Harry’s, which may look like a simple business on the surface, designs, manufactures and sells razors and grooming products for men taking part in the race to change the razor market with more attractive prices and services. The startup sells razors over the internet, both on a one-off basis and as a subscription. It hold a niche of being the only company that owns the full stack, from manufacturing of the razors to engagement on the consumer level through direct sales.
Co-founder Jeff Raider said, “Razor blades are much harder to make than we anticipated. You actually have to change the molecular composition of the steel and then grind it so that it’s very sharp at its tip and strong at the base. Because we are vertically integrated, we can take feedback to the customer and invest back into the manufacturing process to ensure a high quality product every time.”
Apart from Wellington Partners, the funding round was participated by Harry’s earlier backer Tiger Global Management. The funding brings Harry’s total venture capital raised to $164.5 million. Earlier, the company had raised around $211 million in debt financing as a means to purchase and expand the German-based factor where it makes its razors.
Now with the new flow of funds, the startup plans to use it expand the shaving brand into a global phenomenon through recruiting, research and development, advertising, sales and marketing. It is also planning to do more research into the next-generation razor blades, shave kits and other grooming products.
Raider claims to sell more blades that the factory can handle. “We are launching a major initiative to expand our factory in Germany with high-end, custom machinery that we think will make the best blades in the world,” he said. He also added, “We want to create a fundamentally better experience around shaving and grooming.” Though, he did tell Harry’s was not yet profitable.
“The greatest challenge at Harry’s is that every day, we make physical products that are very difficult to make. I’m humbled by the process that happens in our factor in Germany, and as we continue to innovate, we have a lot of ideas for how we want to improve products over time for our customers. The thing that’s really hard is making those ideas come to life in production,” said Raider.