'Shark Tank' offers $250,000 deal to an engineer who found a better way to make diapers

Diapers are essential for parents with babies, but while they are meant to maintain hygiene, not being careful could expose a child to harm. A contestant on “Shark Tank” worked at one of the leading diaper manufacturers and was shocked at the amount of plastic and chemicals used to make them. Hence, she started a company of her own, created eco-friendly diapers among other things, and got a deal from two sharks. That is the story of Amrita Saigal.

An MIT and Harvard graduate in engineering and business administration respectively, Saigal worked at Procter & Gamble for a long time before taking that leap of faith and starting her own company. She moved to India where she founded her company Kudos which specializes in eco-friendly diapers, sanitary pads, and baby wipes among other things. In her first year of operation, it was not profitable but she still managed to earn $850,000 in revenue.

It’s no wonder she was confident in her pitch and asked for $250,000 for a 5% equity in her company. The products her company was making were made from cotton and banana peel fibers without any harsh chemicals or plastic. Not only would it feel a lot more comfortable on a baby’s skin, it would significantly reduce plastic waste from such diapers.

The sharks were intrigued but not yet convinced. Kevin O’Leary, being the meticulous investor that he is, had his doubts about the demand for such products in the market. After all, the eco-friendly diapers cost around 20-50% more than regular diapers. Even if things did start well, there are major competitors like Procter & Gamble to worry about. “Do you really think after you get, let’s say 4 or 5% of the market, they’re not going to wake up and say, ‘We need an eco-friendly diaper?’” he asked.

Turns out that’s the least of Saigal’s worries. The diaper market is massive. Last year, the industry was worth a whopping $82.59 billion in the US alone as per CNBC. The entrepreneur explained that having even 0.1% of the market was around $8 million and she would certainly aim for a lot more than that. O’Leary still seemed unconvinced but the same could not be said for the rest of the sharks.

Ultimately, it was Mark Cuban who extended the offer to Saigal but it wasn't what she had asked for. The veteran investor teamed up with guest Shark Gwyneth Paltrow to offer $250,000 for 12% equity. The Kudos owner needed some time to think about it and countered it with 8% equity. Cuban then said they would be willing to do it for 10% with some shares being equity and some advisory. The split was decided at 7% equity and 3% advisory and the deal was agreed upon.

Cuban and Paltrow seemed quite impressed with Saigal. The actor even said, “She clearly has a business mind and engineer’s mind. I think she’s doing something really important and needed in the market.”