DrainWig – Shower Drain Hair Catcher
DEAL
EPISODE SUMMARY
🕓 Air Date: October 29, 2017
Asking For:
$300,000 for 5%
Investor:
Kevin O'Leary
Deal:
$300,000 for 15%
PRODUCT SUMMARY
DrainWig is a hair-catching device for showers and bathtubs that prevents clogs, featuring a stainless-steel chain with rubber whiskers.
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Background Story
Jennifer and Gifford, a couple from Salem, Utah, invented DrainWig out of necessity. Their five daughters were causing constant drain clogs due to their shared shower, prompting the couple to find a solution. The accidental discovery came when they found a massive wad of hair attached to dental floss in the shower drain.
Realizing they had inadvertently solved their problem, they decided to turn it into a product. The idea for DrainWig was born, and after encountering success through infomercials, they sought a Shark Tank investment to break free from their licensing agreement, take control of their product, and build their own company.
The Product
DrainWig is a simple yet effective solution to the common problem of hair clogs in drains. It consists of a stainless-steel chain with colorful rubber whiskers that trap hair before it can accumulate in the pipes. The product comes in two designs – one for the shower with a cute flower cap and another for the bathtub that anchors to the side with a suction cup, allowing the use of the stopper as usual.
To use DrainWig, users guide it down the drain, where it catches and traps hair. After two to four months, the device can be easily removed through the drain cover without any direct contact with the trapped hair. The product is affordable, with a double pack priced at $9.99, and manufacturing costs at around $1.20.
How It Went
The company’s position before Shark Tank
DrainWig has seen substantial success, boasting $14.2 million in retail sales. The product is well-distributed and available in major big-box stores like Walmart and Bed Bath & Beyond. Their initial success came through an infomercial company, which they engaged in a licensing agreement with for three years. During this period, they received $800,000 in royalty payments, equivalent to around 5.4% of their sales.
As they approached the end of their licensing agreement, the founders decided to seek a Shark Tank investment to take control of their product and form their own company. They’ve repaid an angel investor from an earlier round, regaining full ownership.
The Negotiations:
The negotiation process involved the Sharks expressing concern about the current licensing deal and offering various equity percentages for the requested $300,000 investment. Mark Cuban and Sara Blakely expressed concerns and declined to invest. Daymond John and Lori Greiner entered the fray with offers of $300,000 for 20% and $300,000 for 25%, respectively.
O’Leary eventually adjusted his offer to $300,000 for 15%, leading to a deal with DrainWig founders. The negotiation highlighted the founders’ need for capital and expertise to establish their own company, and O’Leary’s offer addressed these concerns, securing a deal for both parties.
