Maybe selling everything under the sun for $3 a pop isn’t such a great idea after all.
The D2C upstart Brandless, which rose to fame peddling generic home goods and personal-care products, is shutting down, according to Protocol. It’s the first SoftBank Vision Fund-backed startup to close its doors entirely.
In the early days, the Brandless pitch was pretty simple
Most everything sold for $3 — coffee, hand soap, boxes of mac and cheese. Even cooking utensils.
Trouble is, that price point wasn’t always cheaper than the lowest-priced options at the biggest retailers. So Brandless was betting that its anti-brand could convince consumers to switch soap allegiances, whether or not it actually sold the cheapest suds.
The company became a SoftBank darling, riding a $240m investment to a $500m+ valuation.
But there was a problem: You get what you pay for
The Information reported that quality-control issues plagued the company from the start.
- Customers complained about items in glass jars — like salsa and pasta sauce — arriving broken.
- The company tried to solve the problem by… wrapping the jars in paper.
Rising competition eventually forced the company to abandon the $3-for-everything approach. It tried to regain its footing by selling more high-ticket items and pivoting to CBD.
In the end, the Brandless board said the D2C market was “fiercely competitive and ultimately proved unsustainable.”