The article strikes an odd tone when talking about the number of employees that Dollar Shave Club employs directly. Yes, DSC doesn't directly employ Dorco employees, but increasing demand for Dorco razors means more production. If Dorco had seen direct demand rise by the same amount, it would have had a similar impact on their workforce. The article seems to bemoan that, "The Korean razor company [Dorco] that manufactures Dollar Shave’s razors will not be sharing the $1 billion deal price with its employees." But realistically, if Gillette finds a way to increase sales via a new marketing or distribution system, I don't think the rank and file employees get a piece of that action. Gillette would have found a way to increase profits for its investors. For employees, maybe there's more job security because of the increased demand and maybe new people get hired to meet the demand, but hourly wage isn't likely to move.

The amount of labor needed isn't changing just because the company directly employs few people. The difference is that different functions (marketing, sales vs. manufacturing) are being done by different companies rather than one company that does both. This means that a company like Dorco which is seemingly terrible at marketing can still get high sales for their product. Similarly, a company like DSC which doesn't manufacture things can put their talents to use.

It's a scary time for companies because now companies don't need to be good at everything to succeed. But that's good for consumers. It means that a company that manufactures a good product won't die because it's bad at marketing, logistics, customer support, sales, etc. - they'll get white-labeled by someone else, but the good product can get to market.

But DSC's success might simply be Unilever over-paying for something. Another commenter brought up Harry's (https://news.ycombinator.com/item?id=12198431) which decided to buy their own razor factory. They can create a product that you can't get elsewhere. I can go to dorcousa.com and buy razors direct (and they often get them nearly half off via coupon). I now no longer need DSC. Dorco's razors are behind a lot of store-brand razors and so I can simply go to my local shop rather than paying for DSC. So, Unilever bought a subscriber list and a brand. As another commenter pointed out (https://news.ycombinator.com/item?id=12198614), their margins are basically zero with most of the money going into buying the razors and the expense around shipping and logistics.

The article just hates to see success by a company that seems more fluff than substance. That's fair, but then the argument is that they're over-valued. They haven't produced anything of substance and are shipping all their revenue back to third parties. If they have produced something of substance, then maybe they are worth the money and are providing employment indirectly to Dorco employees, shippers, and such.

I think the real fear is just that it's easier to test the waters for product-market fit than it used to be. If they had to handle everything themselves, it would be hard to start DSC. Here, they could prove product-market fit without requiring extremely high levels of capital. But that's a good thing. It means that good ideas can get out there.