2. What are the key elements of Dollar Shave Club's value proposition for consumers?

In the past decade, the disruptive influence of the Internet and the mobile platform has reshaped the music industry, newspapers and book publishing, software distribution, and data storage, just to name a few high-profile examples. Companies with business models that would have been inconceivable years ago are ruling the tech landscape today.

And traditional retailers find themselves under threat from a host of unexpected startups. One of the more unexpected success stories is the rise of Dollar Shave Club from a small startup with a viral video touting low-cost razor blades to a $1 billion company in less than five years.

Modern entrepreneurs are on the hunt for markets where customers perceive unfairness or inefficiency, but can’t do much about it. The U.S. market for razor blades in 2012 was exactly that type of market. Gillette held a 72% market share for razor blades and used its near-monopoly power to great advantage, charging as much as 167% markups for razor blades. Originally, Gillette, Schick, and other razor manufacturers disrupted the business model in their industry by offering razors at low cost or even a loss, and then selling replacement blades at a significant markup, allowing them to make money indefinitely. Today, Dollar Shave Club is disrupting them.