Brandless, the US online retailer of household consumer products, is getting lots of media attention lately surrounding their insanely affordable products and star studded investor list.
The company has A-list investors, which include basketball player Steph Curry and Nick “Swaggy P” Young of the Golden State Warriors; the LA based talent manager to the stars, Scooter Braun; book author and philanthropist Jessica Seinfeld; the CEO of Weight Watchers Mindy Grossman; early Facebook employee Randi Zuckerberg, and other close friends and family to the company founders. Brandless has already raised a total of $50 Million dollars from investors.
I had the opportunity to listen to Tina Sharkey, Brandless CEO and co-founder at the San Francisco Beauty and Technology meetup where she spoke on a panel giving advice to startup entrepreneurs.
When asked about how she went about selecting her investors, she says that her investors were hand picked because she wanted to work with people who will be in the trenches with her. “They understand our product and mission, but the most important thing is they understand our movement of democratizing access.”
Here’s 5 Ways Brandless Is Different:
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They Create High Quality Products.
The website has over 250 generic consumer products, ranging from toilet paper to bar soap, that are priced at only three dollars across the board. Most importantly and equally impressive is the quality of these products. Most of the Brandless products are on par or even better than the quality of goods at Whole Foods. For example, all of the food items are non-GMO and over half are organic. When you browse the beauty and health category you will find there are no products tested on animals or toxic ingredients included.
2. They Market Their Products with Low Cost Savings for Wider Sales.
The most innovative part of the retailer is the business thesis. While many investors want to focus on a higher margin that will return on their investment quicker, Brandless investors see the long game vision. Perhaps it takes a little team building to get the investors behind the idea that selling at a lower margin allows for a wider reach across the United States. But that’s why Sharkey was so selective about finding the best investors for her company, she understood the value of having Warrior basketball stars like Steph Curry and Nick Young on her team.
Sharkey says “Brandless is able to charge 40% less on average for products of the same quality because we are eliminating what the company calls the ‘brand tax,’ which are the fees that companies have to pay for space on the supermarket shelves that drive up the cost of the product.”
With technology and creative thinking, modern shoppers are people who deserve the highest quality product for the lowest price. America has had enough of the Walmarts of the world selling low quality products for a low price. Don’t get me wrong, Walmart is certainly serving towns and cities, and their online retail service is great, but with their large size also comes making decisions for the profit of the company.
By getting rid of the middleman, Brandless allows for anyone to order online and have their household consumer products delivered directly to their door, just like Amazon. “We are more than just a collection of fair prices” Sharkey says. “We are a movement that says everyone deserves better – and better shouldn’t cost more.”
3. They Are Innovative, They Think Outside the Box.
But it’s not just the brand appeal of getting cost down to $3 a product that makes this company innovative. Sharkey says “Brandless is on a bigger mission than just low prices.” She’s taking note of recent shifts in consumer behavior to generate insights that drive the business forward such as trend spotting. Organic foods are on trend, but it’s more than that. Big food brands like Kraft Foods don’t have the resources to acquire Amazon – not that any company does — but they are shopping for companies to acquire with a “direct to consumer business model.” For example, Unilever acquired Dollar Shave Club for $1 Billion dollars in 2016 because Unilever wanted to tap their direct to consumer business model.
Also, people shop differently these days. Amazon has lead the way driving shopping habits where people expect to have a seamless experience ordering groceries online or on their phone through an app. People don’t want to waste time going to the grocery store anymore. With next day delivery and the ability to preserve fresh foods with cooling packaging and ice packs, it’s no wonder people are turning to buying online.
4. Challenge The Status Quo.
Big brands should take note of this business model. In a time where it’s evolve or die, big companies will find it difficult to grow and change at the speed of a startup like Brandless. Big brands should learn to understand what it means to be an online retailer in today’s high tech world.
Dean Flynn is the Co-founder and CEO of FoyerLive bringing online intelligence in store says, “It’s an exciting time in retail and young online brands are demonstrating the huge opportunity to capitalize on customers desire for direct engagement. Breaking the traditional fulfillment channels isn’t simple for a traditional brand, but they can no longer wait on the sidelines. Particularly as we see online success stories like Warby Parker and Bonobos take the same mentality that helped them win online into physical stores where they are extending their reach to new audiences and increasing their competitive advantage further.”
Clearly, if you are an entrepreneur trying to solve a product related to household products and fresh food, or even if you are looking to start a retail business, you should try to find an innovative way to cut out the middleman, create a new business model, go “direct to consumer”, and give your buyers a high quality experience with good products.
Brandless, RoyerLive, Bonobos, Warby Parker and Dollar Shave Club are all examples of companies that understand the value of going direct to consumer. Another quality all these founders have in common is experience. They are not ever going to make the Forbes 30 under 30 list, and they don’t care because this isn’t their first job out of college. These are serious business executives. For example, Tina Sharkey was with AOL for a long time and worked her way up the corporate later to become Senior Vice President. Then she left to join a venture capital firm before she started her company.
5. Have A Female Founder Passionate About STEM.
I had the opportunity to sit down with Tina Sharkey and ask her a little bit about her background and why she cares about STEM and her more early years getting started as an innovator. Here’s a brief Q and A:
Why did you become interested in innovation and technology from an early age?
I’ve always been interested in making complex things simple and quickly found that by using technology as an enabler I could do more see more and create more. Technology can be used to scale ideas, connect people and make utility the new luxury whether that is to connect people, build community tools and platforms.
How has STEM helped you to as an entrepreneur? Or if it hasn’t, how are you helping young girls to achieve their dreams in STEM?
Yes, one of my super powers is my ability to see where data, culture and trends connect and distill this into storytelling. I translate technical information into what it means for a business, consumer or sector of the economy. A pursuit in arts and sciences allows me to distill and engage audiences of all types.
I am as comfortable sitting in on meetings with my finance and engineering teams as I am distilling the information into storytelling and articulation that sets in motions our strategy and roadmap. It is a fluency of understanding multiple languages – even though I cannot code – it doesn’t make coding is foreign to me.
My vision at Brandless is to engage designers and coders and leverage their specific skills to solve multi faceted projects. Culture, language and arts and tech is about people. The more you have fluencies in these languages, methodologies and ways of thinking, you can have lots of different conversations.
What can schools and society do to encourage more girls to get involved in tech?
While I was doing my undergraduate at Penn I got my bachelor of arts from the college of arts and sciences. Rather than having to choose – science or arts — I strongly advocate for more integration between the two curriculums.
Girls more often tend to go through the arts track so why don’t we use this as an opportunity to integrate into those tracks as well. The arts, presentational and critical thinking skills are required in leadership roles, which are anchored in the foundation in arts. The truth is you also need to have a basic understanding of technical skills too. My advice is to be fluent across all platforms, recognize the changing trends with the technical abilities to engage, explain and distill it all.
Engineers should have an anchor in understanding arts and vice versa. Not mutually exclusive. Every company is a tech enabled company and we should make that accessible to every major and minor.