Appetite for water tech grows with seeding round success

Water is an ideal opportunity for investment

Uplink’s report, Investing in Water – Aligning Investment Strategies with Water Innovation, explores the current investment landscape in water and addresses some of the barriers to growth. 
Writing in the paper’s foreword, the authors state: 

“Water is not a sector, and yet every sector is dependent on water; this represents both a systemic risk and a powerful opportunity for multisectoral attention and action. Growing recognition of these challenges has led to predictions that water will become one of the most significant investment themes of the next decade.”

 

Develop the innovation ecosystem

Elsewhere, the report makes the case for a better understanding of how water underpins economic prosperity, the climate, and human health. To achieve real change, the report continues, more needs to be done to strengthen and enable the ‘underdeveloped innovation ecosystem’ in which public and private investment work together to scale the solutions that will be capable of solving the world’s water challenges.

“Unlocking private capital for water solutions is not only a moral and environmental imperative, but also a forward-looking investment, with the potential for enduring returns and lasting impact.”

Entrepreneurs, start-ups, scale-ups, and even established companies need investment if the world’s water challenges are to be solved. Solving the world’s water challenges can no longer be viewed as a ‘nice to have’; it must be viewed as critical.

 

Emerald Technology’s Global Water Fund II

Zurich-based venture capital firm Emerald Technology’s initial Global Water Fund closed in 2020 with €87 million in funding commitments from a group of investors that included Temasek, Microsoft, Ecolab and SKion Water.

Building on the success of the original fund and other past water exits, Emerald’s Global Water Fund II has reached €60 million following its first close. Current committed investors include Veralto, Ecolab, SKion GmbH, and Oxy Technology Ventures. The company pointed out, when announcing the first close, that the broad range of industries represented by the initial investors reflects the ‘urgent, cross-sector commitment to solving global water challenges’.

 

Investment to build resilience

Posting on the company’s LinkedIn page, Helge Daebel, partner at Emerald and head of its water practice, said: “As climate and infrastructure shocks intensify, resilience in our water systems is essential.”

He added: “Strong backing from industry leaders in this first close will help us supercharge startups and scale-ups that both safeguard and optimise this precious resource.” 

Emerald is targeting a total fund size of €150-180 million, which it says will:

“Accelerate innovation across the entire water value chain by investing in early to growth stage companies worldwide that are developing solutions in infrastructure and business resilience, advanced treatment, reuse, digitally enhanced monitoring, prediction, decision making and automation, as well as technologies to address emerging contaminants.”

 

Released capital will drive innovation

Funds will now be released to drive innovation and scale technologies designed to solve key water challenges.

“We are thrilled to see such a strong response from market leaders,” Daebel said. “It’s a clear signal that water innovation is not only a pressing global need, but also an attractive investment opportunity. Together with our partners, we are committed to scaling the solutions that will shape a more sustainable water future.”

 

Burnt Island closes Seed Fund II

New York-based Burnt Island Ventures closed its Seed Find II with €43.5 million investment from 33 backers. In a statement on its LinkedIn page, the company posted: 

“We’re doubling down on our mission to find, fund, and scale the most ambitious founders tackling the $1.6 trillion [€1.4 trillion] water market. We're delighted to continue supporting the next generation of water entrepreneurs addressing critical areas in advanced treatment, water access, climate adaptation and more.”

Burnt Island Ventures launched in 2020 with its debut fund securing $30 million in investment that has been fully deployed across 18 companies, with two exits to date.