Two Startups Aim To Fight Water Scarcity With Data

The Water Project, a 501(c)(3) non-profit, estimates that 783 million people do not have access to clean and safe water worldwide, and it is estimated that nearly half the global population is already living in water-scarce areas for at least one month per year, according to the United Nations.

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To address the problem, two Austin, Texas-based startups are attempting to add more nuanced understandings to water usage with the help of investors.

Pani

Allen Tsai had made a career out of building consumer electronics software and hardware. But after his trip to Nepal, he began actively looking for a way to make his passion for water conservation and tech intersect, and thus the idea for Pani was born.

Incorporated in March 2018, Pani’s aim is to transform traditional plumbing into digital smart water networks, enabling the collection of real-time critical water usage data that will give consumers a granular understanding of their water usage, while providing utilities insights on how to incentivize their customers to better utilize existing water infrastructure. By breaking down water usage into the biggest usage culprits like showers, toilets, or faucets, consumers will be able to receive customized and actionable feedback that can drive actual behavioral change, according to Tsai.

But the founding of Pani and his trip to Nepal wasn’t the only impetus for becoming a startup founder focused on water conservation. Tsai’s awareness of water as a precious resource goes back to his early years in Taiwan. Having a farmer for a grandfather helped him grow up being “always very mindful how water was used because, literally, it was our lifeline.”

“It was ingrained into our psyche to be conscious of how we used water,” are youhe told Crunchbase News. “So that has stuck with me, whether it’s showering or gardening, or any activity where water is involved.”

According to the Environmental Protection Agency, the average American household uses 300 gallons of water per day. By contrast, Tsai stayed in a village out of Nepal where the average home used 13 to 20 gallons per day.

“I know this because I was counting and watching every single day as woman and children would spend hours fetching water,” he said. “That’s about 93 percent less than we use in this country.”

It’s an angle on water conservation that investors have apparently bought into.

To bring conservation to the states, investors put $1 million into Pani with plans to mass produce its water-tracking hardware in the first quarter of 2019. That round was led by Blake Chandlee, who joined Facebook in 2007 to lead its global expansion.

To Tsai, a device that’s just “a little beeping smart home appliance was not going to cut it.” So he set about figuring out a way to create a fundamental improvement in the efficiency of appliances.

“Water is not super sexy in tech,” Tsai noted. ”You can’t accurately predict supply, so we don’t want to wait until it’s too late. If you’re almost running out, you either have to make it or conserve it. So we’re trying to get ahead of the curve and bring awareness to the issue.”

“Their innovative water tech stack aside, what is equally impressive is Pani’s massive product vision and their mission-driven purpose,” said Chandlee, who is also an advisor to Pani Systems, in a written statement when the funding was first announced. “The Pani team is first tackling water efficiency at the consumer appliance level, but the work they do will have long-term implications that will enable the world to re-imagine water infrastructure.”

Banyan Water

Another Austin startup is taking a different approach to water conservation. Banyan Water, founded in 2011, describes itself as a provider of data-driven water conservation for commercial and institutional business.

Using its smart software, real-time monitoring, and connected devices, Banyan has, by its own measurements, saved more than 2.8 billion gallons of water since its inception and currently has more than 1,000 acres under management, according to President and CEO Gillan Taddune. In 2017, the company detected an additional 468 leaks that prevented an additional 69 million gallons of water from being wasted, she told Crunchbase News.

Customers include TA Realty, American Airlines, and LivCor, among others. The company also recently entered into a partnership with HydroTech Solutions to enter the cooling tower market.

Banyan Water has so far raised a total of $4.4 million from investors such as Catamount Ventures. Most recently, it brought in $900,000 in Series AA preferred stock.

The world of energy has developed “tremendously” over the past 15 to 20 years; however, water management is still operating in a “more archaic mode,” according to Taddune.

“I think it’s the last frontier, and we need to develop technology solutions to solve these scarcity issues that are in front of us,” she said.

Typically, commercial real estate operators don’t realize there is a problem until they get a higher-than-usual bill, Taddune pointed out.

“They see if there’s a spike or something wrong weeks later,” Taddune said. “With our real-time utilization monitoring, if something looks a bit odd, we can do something about it for them immediately.”

Jed Smith, a managing partner of Catamount Ventures, believes that water is one of the greatest misunderstood areas in commodities. (Catamount has also invested in Seventh Generation and Plum Organics, both of which operate in the commodities sector.)

“The lack of perception about the cost, structure and value proposition around pricing, supply and demand is an issue,” Smith told Crunchbase News. “Some of that has to do with utility and government regulations since pricing and structure is different in every county and state.”

As for Banyan Water, the startup is nearly cash flow even and attracting more attention from REITs (real estate investment trusts) and both educational and corporate campuses.

“Water costs have skyrocketed in the Bay Area, so Banyan is seeing a lot more interest out of that region than ever before,” he said. For example, water rates in Mountain View, California, have gone up 41 percent since 2014, according to Taddune.

Despite that knowledge, there’s no doubt that most Americans take clean water for granted. But as more people become aware of just how critical of a resource water is, it only makes sense that startups are attempting to tackle this global problem with technology.