Investments Archives - Artemis Water Strategy

Mar 25 2014

LG Chem buys NanoH20: Entrepreneurs bring a new breed of management to water

Korean chemicals giant LG Chem’s announcement that it is purchasing NanoH20 adds a new chapter to that company’s rise from a UCLA lab to high profile leadership in a new generation of water tech companies.

Agile, innovative entrepreneurial management has been decisive in driving NanoH20 forward. Specifics of the acquisition have not been disclosed and the transaction is set to fi nalize on April 30. Established in 2005, NanoH20 is part of the first wave of start-ups that have brought start-up business strategies from the technology world to the water industry.

How will LG realize the full value of NanoH20’s entrepreneurial team and its corporate culture? NanoH20 broke new ground with five tactics that have been proven in high tech startups from software to solar:

Technology & business from the first day
NanoH20 was founded by an experienced technology entrepreneur, Jeff Green, and a leading-edge technology developer, Bob Burk. From its first days, NanoH20 developed its products and its strategy with an eye to how innovative approaches—in business as well as technology– might break through market barriers.

Finance from strong partners
NanoH20 launched with a $5M seed investment from top tier investor Khosla Ventures. With that early support, NanoH20 had the resources to develop the product as well as a team behind it.

As the company grew into an international player, NanoH20 raised capital from forward-looking water industry powers, including chemical giant BASF and oil refiner Total. It broke new ground by raising capital from CalPERS Clean Energy & Technology Fund, a large scale, long term investor that has led investments in sustainable energy.

Product design for retrofits
NanoH20 built its solution to allow retrofitting onto existing water operations. This product strategy tapped into the established budget structures to speed purchase decisions. For municipalities and industrial water users that already have water purification membranes, NanoH20 serves as an upgrade that provides big energy savings.

Validation
NanoH20 focused its early marketing upon organizations recognized as authorities in order to gain strong validation early. Its first projects included the US Navy, at its Seawater Desalination Test Facility (SDTF) in Port Hueneme.

Focus upon diverse group of markets
Early in its market launch, NanoH20 went beyond the municipal market to target early-mover commercial and industrial markets, like accommodations and oil & gas. The company’s first major installation was in the Cayman Islands, and it launched in critical markets from China to Saudi Arabia. In October 2013 NanoH2O announced a $45 million investment into a manufacturing facility in Liyang, China.

Next chapter?
As part of LG Chem, NanoH20 may continue to break new ground in the water industry. With big company resource and market presence, will we continue to see NanoH20 drive development of game-changing intellectual property? New partnerships? New investment vehicles?

Mar 19 2013

The Artemis Quadrinity–Four challenges to new entrants in water

Last November in Washington DC, Laura Shenkar joined Jon Freedman of GE Power & Water, David Hughes of American Water, Sally Gutierrez, of the US EPA, Assaf Barnea of Kinrot Ventures in Israel and Adi Yefet-Beeri from the Israeli government’s NewTech initiative to discuss “Cutting Edge Solutions for Global Water Challenges.”

How are Israeli start-ups are breaking into the US water market?

Capital, or partnerships, or initial projects aren’t sufficient alone for a start-up to gain a foothold in the market and achieve rapid growth.

The start-ups that we are seeing climb from initial successes to market presence are succeeding by bringing together all of these forces in a quadrinity. Each of these forces pulls the others forward. In a nascent market such as water tech, putting together the quadrinity is essential. >Read the presentation >

Sep 28 2010

The Gatekeepers of Water Tech

Utility managers like Eric Rosenblum and Ron Zegers are part of a small cadre of experienced leaders within the water utility who have been facilitating new water management approaches for decades. They have ensured that, with very few exceptions, there is a steady supply of healthy and safe drinking water.Like other water utility managers, these men play a quiet but essential role in our world. Our water infrastructure is not only the hard bound pipes and pumps that treat water and deliver it to us – it’s the lakes, streams and rivers that are our source of freshwater. Protecting these sources has become an essential part of the role of water utilities.

We want innovative video games and haircuts, but we want the same old water.

We want innovative video games and haircuts, but we want the same old water. It is the responsibility of water utilities to avoid any unnecessary risks to water quality, and this makes them among the most risk adverse customers for new technology.They demand that new approaches be well-proven in other utilities before they’re considered. As explained by Andrew Salveson of Carollo Engineers, “One of the major hurdles we face is the municipal copy-cat market, and this presents a hurdle to innovation.”Promising technologies spend $500,000 to $1M just to prove their technology works full-scale at a single utility. Many of the seemingly most promising companies over the past few years have not been able to survive the long and expensive process of proving their solutions in the municipal market. As a result, the benefits of these solutions are often never seen by the general population.Scarcity and infrastructure decay require new solutions for water resources management. The process for bringing water technology to market requires money, but more importantly it requires leadership. The few companies that make it through this arduous process are applying innovation to how they bring to their technology to market.

Jul 27 2010

Market Driven Tree Hugging

A helicopter pours water on Californian wildfires in 2009 / Photo: kevindean on flickr — A number of small buckets of water can contain a wildfire / Photo: kevindean on flickr

Climate legislation in the United States just went up in a cloud of CO2. Again.

Which doesn’t for one second mean the battle is lost.

Regulation may have failed, but thankfully, the free-market surrounding water isn’t waiting for regulations to change. The BlueTech sector is already in position with profitable solutions to mitigate climate change.

The inefficient transportation and treatment of water from source to end-user accounts for 13% of energy use in the United States (and 17% in water-starved California).

As we reported earlier this year, the Carbon Footprint of Water Report calculated that a 5% decrease in infrastructure leaks in the United States would save 270 million gallons of water a day and 313 million kilowatt hours of electricity annually — enough to power 31,000 homes. Not only that, but it’d keep 225,000 metric tons of C02 emissions out of the air.

Meanwhile, cities like Pittsburgh, St. Louis and Seattle are introducing plans to replace aging infrastructure, to the tune of nearly $5 billion. Which is only a portion of the estimated $335 billion national pricetag.

It’s a perfectly timed confluence of events: we’re facing a global crisis. The inefficient water complex – which bears some responsibility for the crisis – is due for an upgrade. Simultaneously, innovation in water efficiency has bloomed.

Throughout the country the BlueTech industry is poised to offer municipalities and water authorities cost-savings and reduced costs to upgrade infrastructure via smart-water systems, efficient water-treatment and stormwater management, and positive revenue streams through resources recovered from waste streams.

As water supply ceases to match demand, new desalination technologies can replace ancient systems to achieve excellent energy efficiencies – often with decreased capital expenditures.

Each of these methods mitigates the causes of climate change by making efficient use of water, thereby making efficient use of energy. Efficient energy use reduces fossil fuel extraction (thereby reducing water usage still further) and reduces the release of pollutants like CO2 and mercury into the atmosphere and water supply.

And each of these methods reduces costs for implementers, either by reducing capital expenditures or by reducing operational costs. They’re a win for the economy and a win for the environment.

To be sure, it’d be helpful if Congress would expedite adoption of clean technology by establishing a firm price signal for pollution. But as American politicians have repeatedly refused, the free market is ready to manage the growing climate and water crises, with or without Congress.

Jul 06 2010

Desalination Spending to Double

Azzizia Desalination Plant, Saudi Arabia — Azzizia Desalination Plant in Saudi Arabia / Photo: Waleed Alzuhair on Flickr

Here’s some good news for advanced desalination technology companies.Worldwide desalting capacity is projected to increase by 50 million cubic meters per day over the next six years, according to a recent study by Pike Research.Meanwhile, annual spending on desalination will double by 2016, from $8.3b to $16.6 billion. Spending will total $87.8 billion during that time period. [Read more…]