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From ecommerce to vcommerce: fledgling New York-based razor vendor Harrys leads the way to a new type of enterprise

Let’s start with a con­fes­sion: Harry’s, not long past its first birth­day, is more than an ecom­merce razor ven­dor. It doesn’t take a vet­er­an ecom­merce ana­lyst to fig­ure out that if a fledg­ling firm is in a posi­tion to make a $100 mil­lion acqui­si­tion before its first birth­day, it’s got a bold and con­vinc­ing vision of its future.

Big spend, big plans 

Co-found­ed by Andy Matz-May­field and Jeff Raider, the com­pa­ny raised $122.5 mil­lion last year from Thrive Cap­i­tal, Tiger Glob­al, SV Angel and High­land Cap­i­tal (plus a few oth­ers). Then it spent $100 mil­lion of it on acquir­ing the 93-year-old razor man­u­fac­tur­er Fein­tech­nik. Brave? Most ecom­merce man­agers and ana­lysts would cer­tain­ly think so. But there’s a seri­ous plan behind the move.

This is a David get­ting ready to take on Goliaths like Gillette and Schick, who between them con­trol a thun­der­ing 85 per­cent of the shav­ing mar­ket. And it’s doing so by tak­ing charge of the man­u­fac­ture of the prod­ucts it wants to sell online. That means it con­trols mak­ing the very prod­ucts it designs, dis­trib­utes and sells direct­ly to cus­tomers – in oth­er words, it’s a ful­ly ver­ti­cal­ly inte­grat­ed com­pa­ny, one amongst a very small and exclu­sive group in the shav­ing indus­try, like Schick and Gillette.

Raider isn’t new to the busi­ness of sell­ing high-qual­i­ty, beau­ti­ful­ly-designed prod­ucts direct to con­sumers at afford­able prices, hav­ing also been a co-founder of War­by Park­er. But while War­by Park­er and oth­er New York star­tups like Bono­bos have done a great job in giv­ing a new twist to every­day prod­ucts (eye­wear and men’s cloth­ing respec­tive­ly), both depend on third-par­ty manufacturers.

From “e” to “v” 

With Fein­tech­nik in the fold, Harry’s has a par­tic­u­lar­ly flex­i­ble man­u­fac­tur­ing plant at its dis­pos­al: the com­pa­ny has exten­sive expe­ri­ence in been mak­ing not just sim­ple, bud­get sin­gle blade razors but extends right up to high-end five-blade razors, which have become Harry’s staple.

No expe­ri­enced ecom­merce ana­lyst will be sur­prised to find that, with these three core capac­i­ties under its hat (con­trol of man­u­fac­tur­ing, con­trol of design, con­trol of the sales fun­nel), the start­up attract­ed invest­ment from Raider’s War­by Park­er co-founder colleagues.

With the remain­ing $22.5 mil­lion, Harry’s plans to expand its high-qual­i­ty, rea­son­ably priced port­fo­lio of prod­ucts. And with its ver­ti­cal­ly inte­grat­ed capa­bil­i­ties, it’s call­ing itself a “vcom­merce” company.

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