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Water PLUS – Keys to Building a Scalable Water Business – Part 2

July 20, 2010

In my previous post I introduced the PLUS framework for water-technology scalability, and expanded upon the first two attributes: Software and Usability. Let’s explore the other two: Leverage and Partners.

Leverage means capitalizing — to exponential effect — on assets, processes and data already existing in the organizations you are serving. Water utilities, for example, have plenty of ‘leverageable’ assets, primarily deep and rich knowledge, held by experienced people. Tapping into this resource is not easy, but best-practices are a power-multiplier, and baking the combined 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. A great example: SmartMap by Thomson Mapping is a Water-specific CAD software that 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 at TaKaDu.

Last but not least: Partners are essential for scalability, especially if you are a startup. Maintaining a direct sales force is an immense overhead for a small, capital-efficient technology innovator. 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, who are big enough to get our solution into the hands of many customers, and efficient enough to keep us focused on delivering the solution while they do the sales heavy-lifting.

It’s not enough to identify great partners. You must make your product offering – and in fact your company as a whole – relevant for partners. We call that ‘Partner-readiness’. The product offering should be easy enough for partners to master, administer and distribute (and yes, SaaS makes it so much easier). It should also be easy to understand from a business perspective. The partner should be able to work out the “what’s in it for me” part quickly.

A tip: Sometimes the direct revenue stream is not the raison-d’être for a product partnership. If your product gets your partner into doors they could not open before, that by itself could be worth more than the marginal addition to the balance-sheet. I’ve seen it many times in my VC career: An innovative startup allowing a large, sometimes ‘heavy’ partner to start talking a different talk, making even the most skeptical of customers listen again.

In the previous post and this one, we have talked about Partners, Leverage, Usability and Software. PLUS is a mini-framework for building a new class of water businesses – smart, efficient and scalable.

Implementing these principals guarantees a sustainable business model. But there is no substitute for the secret sauce that makes successful businesses stand out: ground-breaking technology and an appetite for innovation. Water PLUS is a strategy empowering great technologies to attract funding and scale into profitable, high-return businesses.


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