As demands for new solutions to age-old problems in the water sector continue to grow, one start-up incubator has been steadily helping new water tech companies gain traction in the marketplace.

Although the three-year-old $1.2-trillion Infrastructure Investment and Jobs Act is providing billions of dollars for water, stormwater and wastewater infrastructure in the U.S., water-sector groups say more public and private investment will be necessary in coming years to address problems associated with either too much or too little water not only in the U.S., but around the globe.

In a report released last month, the Netherlands-based Global Commission on the Economics of Water said numerous low- and middle-income countries will need to invest more than $500 billion annually in the coming decades to achieve clean and drinkable water for all—a lynchpin of the United Nations' goals for sustainable development. Moreover, investing in technologies and processes that allow for more efficient management of the hydrological cycle is also needed, the commission said. 

Imagine H2O, a niche business incubator based in San Francisco, has been steadily supporting disruptive technologies in the water sector since 2009. Established in 2008, the non-profit’s business accelerator has raised more than $1 billion in early-stage funding for 115 start-ups. More than 80% of the firms supported by the incubator’s programs continue to operate, and some have gone on to scale-up and partner with large industrial or municipal water treatment entities. 

John Ikeda, chief mission officer at the Water Environment Federation, describes the incubator as “a major driver for innovation in the water sector.” Ikeda says he has worked with Imagine H2O both at WEF as well as previously at the World Bank. “For entrepreneurs, access to capital, potential customers, and mentors is invaluable. As the leading accelerator for water entrepreneurs, Imagine H2O plays a key role in our sector’s innovation ecosystem,” Ikeda told ENR in an email. 

In a world where not only climate change impacts, but the huge water demands of the data centers, semiconductor manufacturing facilities and other growing areas of the tech sector are growing, clean water supplies will continue to shrink, Ikeda notes. As a result, “there’s  increased interest from the investment community in financing both water innovation and water infrastructure,” he says. 

The 501(c) organization does not take an equity stake in the companies it supports, and receives support from a combination of philanthropic and public funding. Temple Fennell, managing partner of Clean Energy Ventures, one of the non-profit’s donors, says his firm only supports companies and technologies that could scale up for market adoption with $30 million or less. “We have been looking at companies in the energy/water sector for several years and consider IH2O the essential source of innovative companies,” he says.

Steadily Gaining Traction

Seattle firm Membrion, which was in Imagine H2O’s 2021 cohort, has developed electro-ceramic technologies for industrial wastewater that include self-cleaning, low-fouling membranes. A pilot study conducted in partnership with Colgate-Palmolive demonstrated that their technology could treat 85% to 93% of wastewater brine produced through reverse osmosis treatment at one of the Fortune 500 company’s manufacturing facilities. The ability to reuse the water could ultimately reduce the manufacturer’s reliance on new water from the municipal or ground water supply, the firm says. 

Greg Newbloom, founder and CEO of Membrion, says the pilot showed that “an ubiquitous source of industrial wastewater could be economically treated for reuse and that circularity of wastewater is attainable.” Membrion is now working with the company to deliver 400 million gallons of reused water at the company’s facilities around the world through a service contract. 

Gross-Wen Technologies (GWT) is another alumnus of the 2021 cohort. The firm uses algae biofilm during wastewater treatment to reduce nitrogen and phosphorus levels. Founder Martin Gross contends that his technology has low operating costs, and that it produces fewer greenhouse gas emissions than conventional treatment. 

Going through the accelerator program provided access to a greater network of water professionals, Gross says. “That’s led to new investors for the business, and just overall an increase in our knowledge on how the industry works,” he told ENR. Clients include and food and beverage producers, as well as municipalities. 

GWT is providing wastewater treatment for a new resource recovery in Pasco, Wash., that is approaching 90% construction completion. The facility will enable the reuse of approximately 1.5 billion of gallons of wastewater per year and will produce enough renewable natural gas to supply more than 4,500 homes in the state annually. 

Companies in the 2024 accelerator cohort include a subsea desalination technology developer, Meno Park, Calif.-based OceanWell Water; and WASE, which uses modular electro-methanogenic reactor technology to treat wastewater and sludge and generates biogas as a byproduct. 

WASE is currently treating 17 cu m per day of wastewater and generating more than 500 MWh/year of renewable energy for the Hepworth Brewery in West Sussex, England. 

More than 400 firms applied to participate this year, says Imagine H2O accelerator program manager Nidhi Menon. Ten ultimately were selected. “Since we are the leading water accelerator, companies just come to us. They look to us as a stamp of approval,” she says. 

In addition to the primary accelerator program, H2O also has an incubator specifically for firms that provide water solutions in Asia. 

Successfully Scaling Up

Several of the firms that have gone through Imagine H2O’s programming go on to larger-scale incubator programs. Membrion’s successful pilot with Colgate, for example, was conducted with support of the 100+ Accelerator, which connects sustainability-focused start-ups with corporate partners that include Coca-Cola, Danone, and Unilever. OceanWell is currently also participating in the Xprize Foundation’s $120-million Desalination Challenge program. 

In August, Imagine H2O launched the Water Innovation Pilot Fund, which will provide recoverable grants and loans to make it easier for small start-ups to scale up and develop pilots. Coca-Cola and Oceankind are among the original financial supporters.