From the beginning, Brandless painted itself into a corner: At $3 per item, it’s hard to make a profit selling high quality consumer and food products unless you’re driving huge volume. For customers, ordering enough $3 items to hit a free-shipping minimum can be exhausting.

I think this drives at a more fundamental failing by Brandless in particular, that is likely true broadly: the company’s cost structure was completely unsuited for DTC. My strong suspicion — admittedly biased, given Stratechery’s business model — is that the biggest opportunities in DTC are in niches, and the best way to exploit those niches is by... See more

Brandless was primarily felled by a thesis that never panned out — that there were young consumers who craved a digital middle ground between dollar stores and malls. People who were price-sensitive, cared somewhat about quality, but not about brands. Walmart for hipsters. Trader Joe's for millennials.