RSF Loan Finances Better Diapers for Baby and Mother Earth
September 14, 2009
By Ted Levinson
It’s hard to believe, but the average U.S. baby goes through 3,800 diapers. That’s a lot of diapers, a lot of money, and a lot of waste. One of RSF’s newest borrowers, gDiapers, is gaining market share with a flushable hybrid diaper that strikes a happy medium between the convenience of disposable diapers and the environmental benefits of cloth.
The diaper debate truly is a “messy” affair. Disposable diapers are tough on the environment from start to finish. Seventy percent of the average disposable diaper comes from trees, and the remaining 30% is derived from petroleum. After a briefly useful life, the diaper winds up in a landfill where it rarely obtains the light and air required for biodegradation.
Cloth diapers, on the other hand, are cumbersome. Although the diapers can last for a long time, the water and soap used to wash the diapers has a significant environmental cost – so great, in fact, that the EPA is unwilling to state if they are a better option than disposable diapers.
gDiapers’ answer is a biodegradable insert (which can be flushed, composted or tossed) inside a reusable, plastic-free, cotton outer shell. Cookie magazine calls it the “virtuous, eco-friendly” option. At RSF, we think it’s an innovative solution to a permanent challenge. gDiapers squarely delivers in our ecological stewardship focus area. The company is equally impressive when evaluated on its supply chain oversight, treatment of its workers (including Waldorf-inspired daycare!) and management’s commitment to all their stakeholders – advertised as “fair dinkum” in a nod to the company’s Australian roots.
RSF’s loan to gDiapers will help the company manage its cash flow during its robust growth phase. Sales for 2009 are expected to be four times larger than 2007 and there’s still plenty of room for growth in this $3.6 billion domestic market. The company’s success (major accounts include Babies ‘R Us, Whole Foods, Diapers.com and London Drugs) was putting a strain on gDiapers’ cash as each new order tightened working capital. With a loan from our Core Lending program, gDiapers is ready to swaddle America in goo goo blue, golly molly pink and grasshopper green little gPants.
For more information, visit: www.gdiapers.com. Also, you can see Jason Graham-Nye, CEO and co-founder of gDiapers, speaking on a “Social Finance” panel this fall at the Social Venture Network conference.
Ted Levinson is Senior Lending Manager at RSF Social Finance.
- Published by Ted Levinson
- Categories: Deals, Ecological Stewardship, Investing, Lending, Social Investment Fund, Social Investment Fund Borrowers
After just having been through this phase myself with young children, I am glad to see RSF reaching out to find the middle ground between cloth diapers and disposables. This is a great solution!
Comment by Michael — October 6, 2009 @ 11:11 am
[...] The prospects of technology rescuing us from this path are strong; the forces of the free market kick into overdrive when resources become scarce and dear. High-priced oil will drive more energy innovation and conservation than the shame of a spoiled earth. We could wait for technology to rescue us— playing a cosmic game of chicken—or we can act now to heal and preserve our planet. At Rudolf Steiner Foundation Social Finance (RSF) we’ve chosen to be proactive through finance. [...]
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