Until not too long ago, entering the water business with technology solutions for water utilities typically meant long, capital-intensive, integration-heavy, project-driven initiatives. As a result, with the exception of highly specialized tools, you could not build a scalable water technology business without investing dozens or even hundreds of millions en route to scale. Not exactly an investor’s dream.
Times are changing, and we are at the beginning of a new era. There is definitely a sense of inherent scalability baked into the next generation of cleantech startups, and water is not lagging behind. The revolution is changing the way many investments in infrastructure, industry and process are made. A sea-change in the way resources are managed doesn’t have to be project and public-works intensive.
As a result, smaller and more nimble companies are taking the stage. Getting legacy infrastructure to work makes more sense now. Tracking assets and networks to know what’s going on before taking out the heavy machinery is key.
Yet, a business challenge remains.
How can one build a scalable business in a space characterized by gigantic projects, endless sales cycles and huge contracts? The answer has four pillars: Partners, Leverage, Usability and Software. And to make things easy it also comes with a nice acronym. Introducing the Water PLUS.
Let’s examine these four elements one by one, starting from the most obvious.
Software: That’s a gimme. Software is an order of magnitude more scalable than hardware, and in the current incremental, ROI-driven climate, it has more chances to succeed than a “tear everything out of the ground and begin again” approach. Nothing to physically install, no holes to dig, no valves to be added or sensors to be hooked up – just install and start using. Moreover, the IT-heavy world of installations and versions is gone. The enterprise software space has experienced a mini-revolution dubbed SaaS – Software-as-a-Service. In layman’s words – software consumed from someone else’s servers, with nothing to deploy on a local machine.
SaaS adds an extra sense of scalability, since it addresses some of the hardest obstacles to quick, repeatable and scalable deployment: On one hand, getting past the IT department, and on the other, managing versions and upgrades. Reducing friction on the first deployment and then again on each and every update or upgrade to the system is crucial.
In recent years there have been several attempts to take a SaaS approach in water technology. Starting from the most basic SCADA systems, such as Tuppas or Multitrode, all the way down to smart sensors managed via a remote web-based service, as is the case of Derceto. When the idea behind TaKaDu was conceived, it was clear to its founder (and to its investors) that it could be much more scalable if it had zero IT footprint. It would make sales easier – no promises to be made – try the SaaS and see if you’d like to buy – and more importantly, it would make the utilities’ lives easier.
Moving on. Let’s talk about Usability.
Usability and User-Experience are rarely mentioned when talking about water technology. Where there are large pipes and complex networks, operational and monitoring interfaces (and gear) are typically complex, take a long time to get the hang of, and separate the men from the boys. If you can figure out what’s going on and actually manage the water system – be it production, distribution or treatment – you have got to be either a veteran or a very unique individual. User-friendliness is not a common attribute of most water technologies. This is not scalable.
The up-and-coming generation of water solutions is all about user-friendliness. Easy to understand, easy to operate, easy to learn – these are keys to success. The underlying science can still be as complex as it needs to be, but what’s under the hood stays under the hood. Take, for example, i2o Water’s pressure management solution. It still involves smart pressure controllers being deployed into the water network, but the user interface is friendly enough for a newcomer to decipher and operate successfully. Needless to say, in TaKaDu we have been stressing usability from day one, and there’s always room for improvement. Our first customers have been great design partners.
Leverage is a key attribute. Taking advantage (in a good way, of course) of assets, processes and data already existing in the organization you are serving. Water utilities have plenty of ‘leverageable’ assets, primarily deep and rich knowledge. Some of the knowledge and knowhow is held by experienced people, and tapping into this resource is not easy. But best practices are a power-multiplier, and baking the joint experience of hundreds of professionals into an automated decision-support system is a great way to make your solution scalable. It’s the famous network effect.SmartMap is a great example of how Water-specific CAD software implements existing models as a baseline for new designs.
Data is another major lever. Water utilities have plenty of data encapsulated in their network, in the form of geographical information (GIS data), meter logs, burst records and repair history. Being able to leverage this data and making sense of it means reducing the dependence on new sensors, meters or manual processes, and increases the scalability of your business multi-fold. In order to implement Water Infrastructure Monitoring in a scalable way, we took this exact approach.
Last but not least: Partners are essential for scalability. Maintaining a direct sales force is an immense overhead for a technology innovator with global reach. And the utility industry is global. Being able to mobilize large players and get their attention, resources and sales focus, is often as crucial as getting your technology to work – maybe even more. The challenge is obviously finding the right partners (and they don’t come in one-size-fits-all) and then working efficiently with both the C-level execs and the people on the ground, doing the actual door-to-door work. In TaKaDu we are fortunate to have identified several such partners, such as Schneider Electric.
Water PLUS is a mini-framework for building a new class of water technology businesses – smart, efficient and scalable. Implementing these principals guarantees a sustainable business model. But there is no substitute for the secret sauce making successful businesses stand out: Ground-breaking technology and an appetite for innovation.