WaterSmart Software, a green tech startup that’s frequently compared to the energy management startup OPower has closed a $900,000 round of seed financing led by Menlo Incubator and joined by Sand Hill Angels, Draper Fisher Jurvetson and Physic Ventures.
The company’s co-founder Peter Yolles explained the concept of the technology in an interview with TechCrunch ahead of the funding announcement:
“WaterSmart Software is really about creating a relationship between the water utility and the homeowner. Most residential consumers don’t understand how much water they use and where it goes in the home. We’re trying to create a way for them to ask and answer questions like: how do I compare to my neighbors, in terms of water use? What are the two or three best things I can do in or around my own home to save water? What costs me the most money?”
Another WaterSmart Software co-founder, Rob Steiner said:
“We white label our analytics, so they appear online and in print like a tool from the water utility that helps people monitor their water use, break down the meaning of their water bills, and take advantage of all the incentives, rebates and freebies a utility already offers.
We have hundreds of parameters and variables that we analyze, including: water consumption and water billing, census, demographic, real estate, climate and weather information. We even include some details that are about how much you can cut down on gas and electricity use, when you cut down on things like hot water.
We’re making it easier for consumers to save money, and making it easier for utilities to market water and energy efficiency better.”
WaterSmart’s executives found — through a combination of the company’s own research and outside market intelligence — that a typical household of 4 people including children in the U.S. will use between eight and ten thousand gallons of water per billing month, and that in most U.S. markets, the price of water is going up 1.5 times faster than any other utility bills each year. They believe they can help utilities and consumers reduce water consumption by 2 percent, this year.
Does that amount to significant savings on a dollar basis? In some markets more than others, perhaps.
According to Circle of Blue: “In the last year, the price of water in 30 U.S. metropolitan areas has increased an average of 9.4 percent for residential customers with medium consumption levels… Yet the median increase for medium consumption was 8.6 percent.”
Steiner said the startup will use its new-found capital to complete pilot projects already under way with major water utilities in California, and to get beyond the proof of concept phase with their technology. They also seek to hire ten people this year; they currently have six full-time employees and are based in San Francisco.
Not affiliated with the WaterSmart Innovations conference, or U.S. Department of Interior program to help states and water companies adhere with the SECURE Water Act — WaterSmart Software won the inaugural, ImagineH2O competition in May 2010. The competition rewards businesses with technology that can curb, and help people cope with a growing, global water crisis.
Scott Bryan, director of operations with ImagineH2O said:
“Natural resources are over drafted, and there’s an increasing risk affiliated with climate change that makes water supplies more variable around the world. Companies like WaterSmart will make it easier for anyone to understand their water footprint. Most importantly, they have hit upon a capital efficient way to make a difference and to raise awareness. Many other water and cleantech ideas require tens of millions of dollars to even try to get something up and running.”
Serial startup CFO, and angel investor Steve Bennet, with both Menlo Incubator and Sand Hill Angels, said the company locked the substantial seed round because:
“The co-founders are water geeks with a lot of domain expertise. They had already developed a great portal, and analytics. They also managed to sign up two, municipal water providers to homeowners in Northern and Southern California to use their software. Having these pilots lined up made us enthusiastic. Though there are a lot of unknowns, here, the investment will help the company get proof points about how well software, including some game dynamics, can drive efficiency.”