Blueland is an eco-friendly version of household cleaning supplies. In essence, Blueland provides what goes into the disposable cleaning supply bottles but without the disposable cleaning supply bottles. And the cleaning solutions can be had in simple, water-soluable tablets that can be placed in any existing water spray bottle.
The entrepreneurs behind Blueland say that 90% of cleaning products are really just water. As such, they've created a new eco-friendly version that is a tablet of the active ingredient that can be placed in a reusable bottle and have water added to it. (In case the consumer doesn't have a water bottle, Blueland also conveniently sells one.) The overall goal, state the entrepreneurs, is to reduce plastic waste.
Currently, Blueland has four products: a foaming hand soap, a glass cleaner, a general bathroom and tile cleaner, and a "multi-purpose" cleaner. They sell a starter set that includes one reusable bottle and a single tablet for $12 to whet people's appetites for the idea. They also sell an "essential kit" that includes one hand soap tablet and three cleaning tablets for $39.
The cost of making a single tablet is $2.
In terms of sales, Blueland's products have been on the market for a whopping month. However, in that time, they've managed $200,000 in sales. All of the company's sales, thus far, have been direct to consumer online but Blueland will also be launching in a big box retailer in the next year.
One of the entrepreneurs went to Harvard, then worked in private equity, and then went back to Harvard for a business degree. The other entrepreneur was raised in Pakistan as the youngest of nine. After graduating from the University of Pittsburg with a degree in chemistry, the chemist then developed a unique way of formulating the Blueland products.
In terms of investment, Blueland has raised $3,000,000 on a $13,000,000 valuation in venture funding.
Making A Deal
Lori expresses early concern with Blueland's business model, stating that people should be able to purchase a bag of cleaning tablets and not just one at a time. That said guest shark Daniel Lubetzky suggests that he and Lori go in for $1,000,000 at 25% equity together. Lori seems mostly on-board but says that she'd like to revise the deal.
Robert says that he thinks the product is easy but that changing consumer minds is hard and, because he's not up to the challenge, is out. Mark, meanwhile, states that he believes the company isn't actually there to make a deal and is, instead, there for the commercial that Shark Tank might send toward their business and was, therefore, out.
Lori revises her offer to $270,000 for 8% equity to be split between her and Daniel. The entrepreneurs counter at 3% equity. Kevin responds by dropping his offer to 5% but Mark states that this essentially proves his point about Blueland being on the show more as an advertisement than to seriously make a deal.
To this, the entrepreneurs counter Kevin at $270,000 in exchange for 3% of the business plus a royalty of $0.5 per kit until earning back the original $270,000 of investment at which point it would disappear.
Considering the fact that the company walked in valuing itself at an insane $13,500,000 with only one month of sales and, then, only $200,000 in sales at that, it's kind of impressive the deal that they managed to pull off. However, this deal also meant that the company value dropped from $13,500,000 to $9,000,000 on a hot March Saturday, representing a bite of $4,500,000 from a single pitch meeting.
Again, this is one of those situations where, with more sales, the company value is easily recovered. And just as much as the benefit of the doubt toward Mark Cuban or Daymond John is given, one figure to give these hosts as much leeway. In return, viewers really were treated to something new.
- Your Stats Shark happens to believe in the idea that people should be able to purchase a bag of tablets also. After all, one tablet at a time represents a nightmare in wrapping and sealing costs whereas a bag of product means that the cleaning tablets can, essentially, be sold loose and at a much lower packaging cost while also increasing the overall spend of the average customer.