cleantech insights

H2.O – Pushing Past the Clichés Towards the Future of Water Innovation

Janelle Heslop

On September 10-11, Cleantech Group hosted its second annual Water Innovation Summit in Berkeley, California. Representatives from VC firms, corporates, startups, municipalities, and more gathered to debate issues ranging from repair drones in water pipes to financing infrastructure in emerging markets. Our strategy for the Summit was simple: define top challenges throughout the ‘water cycle’ and uncover opportunities to accelerate innovation at each step. However, what quickly became evident, as with many water-related conversations, is that the challenges are complex and solutions are interconnected.

In fact, in summarizing the Summit, Peter Gleick from the Pacific Institute, referred to a few ‘water clichés’ that seem to emerge from any discussion of water challenges and solutions:

  • Water is more than technology; we must consider cultural and political challenges. The confluence of all three—technology, culture, and politics—is the key to making water work. This was particularly noted by leaders from the World Bank and WaterHealth as critical to solving challenges in developing countries. New technologies and business models must be accompanied by an authentic understanding of personal, cultural aspects of water in addition to local regulations. Some innovators in the room provided insight on how to leverage these competing factors—for example,


What’s up with water going down?


Investments in water & wastewater technologies were on a supposedly unsustainable high during the first half of 2012.  The latter half of the year saw relatively minimal activity, accounting for just over 12% of total water dollars invested in 2012.  What happened?

According to preliminary data from Cleantech Group, the number of deals dropped significantly – hovering near 50 in 1H12 but falling to less than 20 in 2H12.  It seems investors lost all interest in supporting private companies focused on drinking water treatment, as I saw no deals tracked for pure filtration or disinfection technologies.  I also noted the absence of big money going towards service providers like Golden State Environment and Doshio, which together accounted for $80MM in growth equity in 1Q12.

Taking a look at the investments that were made, it is apparent that wastewater is continuing to garner significant attention, with nearly half of 2H12 investor dollars going towards companies involved in the treatment of industrial and/or municipal wastewater.  Reuse was one of the more prominent themes here, which comes as no surprise given the heightened anxiety around climate change (and its impact on water scarcity) in the aftermath of events like Hurricane Sandy and global …

A Thirsty Tourist in Thailand


I spent Thanksgiving week traveling through Thailand.  It was my first trip there, and hopefully not my last – the country is amazing!  I love the people, the culture, the food, the views….and the free bottled water?  Yes, you read that correctly – free bottled water.  In Thailand, it is standard to receive 2-3 complimentary bottles of water in your hotel room, despite assurance from the government that the tap water is safe to drink.  As most tourists do, I erred on the side of “better safe than sorry”, and took the bottled water.  Though I must admit, I was somewhat ashamed to do so.

Isn’t the tap water in Thailand subject to WHO guidelines for drinking water quality, which would ensure that I am protected from harmful contaminants?  Doesn’t the organization pride itself on “producing international norms on water quality and human health in the form of guidelines that are used as the basis for regulation and standard setting, in developing and developed countries world-wide”?  Indeed it does, but I overlooked the difference between a guideline and a requirement – an extremely important distinction.  Guidelines are mere recommendations or targets that help ensure the quality of …

A “disruptive” blog post…


The term “disruptive” is thrown around by just about everyone these days – investors, entrepreneurs, policymakers, and even Cleantech Group!  I fear the word is doomed to follow the same projected path of the word “sustainability”…   Before heading too far down that road, I’d like to get in my two cents on some of the water technologies I perceive to be “disruptive” in today’s world.

  • Amoeba.  A majority of commercial and industrial cooling tower operators have used the same [chemical] treatment system for decades and are hesitant to try anything new, even in the face of rising water and energy costs.  Many alternative treatment systems have been on the market for over a decade, but market penetration has been slow.  Non-oxidizing agents such as biocides, though more expensive, are increasingly being tested and talked about.
  • Axine Water Technologies.  According to data tracked through i3, over a quarter (27%) of venture capital dollars in the first half of 2012 went to companies providing solutions primarily applicable to industrial water users.  The growing presence and importance of this consumer segment stems from concerns around toxicity of wastewater streams, the use of treatment chemicals (and potential creation of byproducts), discharge

Video: Company of the Week is Aqwise

Whitney Michael

Analyst Troy Ault explains why we chose Aqwise to be the company of the week:…

Water: Week in Review


With all the attention that the Oil and Gas sector has so far received for its lavish use and disposal of water, it was only a matter of time before we saw companies respond with new products and partnerships to address problems.  While we’ve already begun to notice this trend in the past year, this week in particular stands out given the new products from both OriginOil and Aquatech.  Separately, stormwater management is receiving special attention via new partnerships focused on educating, implementing, and managing stormwater solutions for residences and communities alike.  For details on those products, and other news stories in Water, continue reading below.

M&A/ Partnerships


  • A Gold Coast desalination plant that provided safe drinking water to residents of Brisbane during the 2011 floods is now expected

Water: Week in Review


Headworks and its sister company, Headworks BIO, have had an exciting week.  While one company secured an option agreement with Texas A&M University (to license technology), the other landed a nearly $1MM contract to provide screens for an advanced wastewater treatment plant.  Meanwhile, Grundfos, Ostara, and Mitsui all dipped their feet in the VC/M&A world this week.  The details on these stories and more can be found below.

M&A/ Partnerships


Why Water

Sheeraz Haji

It’s not priced appropriately; regulation is fierce; it’s so fragmented (by geography, technology, and industry); channels are difficult; investment is scarce; water utilities and their engineering firms don’t want innovation … I’ve heard it before: All the reasons why it’s so hard to build a successful water startup.

However, I believe something has changed, and water is now poised to become a top cleantech theme and investment sector over the next few years.  Why?

  • Water pricing will (and has already) improved to more realistic levels;
  • Hidden costs (e.g. from energy costs to move water or property damage associated with water) will start to become more visible – especially to corporations;
  • Businesses will sweat the risks to reputation, product quality, up-time, and supply chain. Can a beverage factory operate without access to clean water? Can a mining company move forward with a project without the community’s trust that precious water resources will be protected?
  • Corporates are investing in water. Exhibit A is Ecolab’s recent acquisition of NALCO or ABB’s recent investment in Takadu;
  • Entrepreneurial talent is starting to pay attention to water, and we shall see some outstanding repeat entrepreneurs venture into the space.

Those of you who know the …

The Quarter That Was: Outsourced Reflection

Greg Neichin

Given the pace at which the business world moves these days, there is often not enough time for thoughtful reflection.  It can be all too easy to get lost in last week’s meetings and next week’s deadlines and to completely miss the forest for the trees.  With the amount of information that we all try to consume on a daily basis, it is easy to mistake a headline for a trend, hyperbole for fact.

Luckily, that’s where we come in.  Consider us your “Outsourced Reflection”.  Every quarter, for the past 7 years, we have published a comprehensive quarterly manifesto – Cleantech Group’s Quarterly Investment Monitor.  Frankly, I think that this exercise is more important than ever.  As we wrote in opening this edition:

2012 has started on a similar note [to the end of 2011] with a rising number of cleantech companies funded despite a continuing public and media fascination with the sector’s high profile failures. In responding to erroneous press accounts of his own death, noted American author Mark Twain once wrote, “the reports of my death are greatly exaggerated.” The same could be said of cleantech.

If all you read in the last three months was news of …

Water: Week in Review


Veolia is keeping itself busy with new contracts and existing lawsuits, while Groupon is showing interest in water – the company recently teamed up with a nonprofit to raise money for water quality testing at California beaches.  Details on these stories, and more, can be found below.

M&A/ Partnerships


  • The US Bureau of Reclamation has awarded a $10.75m contract to design-build firm McMillen to