Brandless shuts down after failing to build a brand without a brand

Tuesday, February 11, 2020 by Robinhood Snacks | Disclosures

Building your brand... is not just a LinkedIn gimmick. SoftBank-backed Brandless, the ecommerce company that sold frill-less, sustainable grocery/homegoods products for $3 each, is shutting down. In 2017, Brandless launched with direct-to-consumer single versions of almost everything — minimalist basics from organic cashew butter to cruelty-free moisturizer, with no brand on the label. Then:

  • July 2018: SoftBank's Vision Fund (which also financed Uber, WeWork, and Wag) invests $240M, valuing Brandless at around $500M.
  • January 2019: Brandless begins raising its prices beyond $3, introducing higher-priced products like baby and pet food.
  • October 2019: Tries to expand its products into brick-and-mortar retail stores.
  • February 2020: Goes out of business.

End "the brand tax"... That was Brandless' thesis: Make products cheaper for consumers by saving on marketing costs. Because if a product's not splurging millions on branding, you can give that $$$ back to customers. But Brandless didn't have enough word-of-mouth and customer loyalty to survive in the highly competitive direct-to-consumer market.


Companies are built on brand... Brand is so important that it often overpowers actual quality, price, and reason. Buying an $80 candle doesn't really make sense — but it somehow clicks if it's from Anthropologie or Goop. Especially for direct-to-consumer companies, where you're not seeing the product on a store shelf, branding is crucial (from Allbirds shoes to Warby Parker shades).