BIV Monthly Update LIII

Written By Tom Ferguson

BIV Monthly Update LIII – 2/12/2024

“Would you mind not shooting at the thermonuclear weapons.” Maj. Vic “Deak” Deakins, Broken Arrow

 Highlights

  • A delicious dinner with LPs, prospective LPs and some wonderful members of our network at Henri in London. Thanks so much to all who joined us. 

  • Delighted to be on stage conducting an illustrious panel around water investment in the context of climate tech investment at World Water Tech in London. Great panelists make the job easy. Was also an enormous pleasure to meet Jonathan and Craig at Previsico in person for the first time, and see Daupler get such a warm reception from the UK and European utility world. 

  • Steve was everyone’s favorite judge at the Produced Water Society annual meeting.

  • Christine repped us hard at the Utility Management Conference, and has done sterling work in company support this month - she’s a rock for her founders.

  • Delighted to complete our third investment in the Opportunity Fund - more details to follow, but it’s a top Fund I company with phenomenal prospects. 

  • A highlight to give a talk back at Winchester College. It is such an insane place to have gone to school, and the calibre of questions was remarkable. Thanks for having me.

  • Sliding off Austrian hills with Kiyan. It’s an amazing thing to see the wee man take to the snow like a duck to slightly-less-frozen water. Wonderful to be with all of the UK family. And the food…

March Asks

BIV Portfolio Updates

Fund I

  • 2S Water – Shipped their first 3 new lithium deployments. Great show at the Cleantech Forum. Raise open and making progress.

  • Aclarity – Awarded the Rising Star Award by the Cleantech Group as a top 100 Global Cleantech company in 2025.

  • Aquafortus – Aquafortus won the Produced Water Society Technology Pitch Competition - well done to the team. Steve was at the PWS and the interest was palpable. SAFE open.  

  • Beagle Services – Great customer highlight from Paul. This team nails customer service.

  • CivilGrid – Welcome Kimley-Horn, Lotus Water Engineering and Geosyntec Consultants to the CivilGrid community. Building the engine, two mega-customers to drop imminently.

  • Daupler – Eyebrow-raising interest from UK and European utilities at World Water Tech in London. Customer success lead Chad embarked on a 3 week European tour. Every utility needs Daupler.

  • Floodbase – Announced a $5 million investment led by Ecosystem Integrity Fund (EIF) with participation from Pulse Fund.

  • Irrigreen – Significant milestone achieved, and some very interesting signals from the market. Irrigreen will be very significant for landscaping contractors. 

  • LAIIER – Announced their partnership with Cox Engineering to bring cutting-edge water leak detection to building owner operators in Boston and the East Coast.

  • NLine Energy – Great post from AFS Energy Systems’ recent NLine install. MASSIVE savings on wasted energy and renewable power generation.

  • SewerAI – Successful show at WWETT. Turned 6. Check out this video of Matt.

  • Shower Stream – Started a new 1K device production run and are on-track to deliver to the first 5 of 50 ESA locations in Q2. Investor roadshow launched this quarter. Invited to present at StartupGrind, Venture Summit West, Southeast Venture Showcase.

  • Spout – Production up and running smoothly. Small fixes required on firmware. End of raise in sight.

  • Ziptility – Prepping for their whirlwind Spring conference. Check ‘em out at Alliance of Indiana Rural Water, Indiana Section AWWA, California Rural Water Association Annual Expo and North Carolina Rural Water Association (NCRWA) Annual Conference. And talk about stellar customer service.

  • ZwitterCo – Successful show at the Membrane Technology conference.

Fund II

OF I

  • Aqua Membranes – Just won another award at Aquatech in Amsterdam. Sign up for their newsletter here.

  • Daupler – Eyebrow-raising interest from UK and European utilities at World Water Tech in London. Customer success lead Chad embarked on a 3 week European tour. Every utility needs Daupler.

Work with the Burnt Islanders

  • All open roles with the Burnt Islanders are advertised through the BIV Jobs Board which is accessible here

Company Pipeline

  • Overall Pipeline: 1549 (+33)

  • The late stage pipeline is stacked, with lots of exciting near-term possibilities in critical infrastructure design and maintenance, drinking water treatment, and water efficiency plays in the food and beverage sector. Some wildly experienced teams with high say-do ratios.

Market Insights

  • The $140m fundraise by Tidal Vision was impressive - that accelerated fast! Evidence that later-stage capital wants early growth stage water companies. 

  • Badger Meter’s acquisition of SmartCover® Systems from XPV Water Partners for $185 million. $35m in revenue and sold for $185m in cash. Congrats to Corey, Dave and the team.

  • Thermo Fisher have taken on the purification and filtration business of Solventum (former 3M filtration business) for $4.1bn in cash. Thermo Fisher is now an emerging incumbent in water.

  • Veralto, who alongside Xylem are the leaders in UV systems for water treatment, acquired Swiss & German based Aquafides for $20m. UV will be an area of considerable interest in the coming years. 

  • Six reasons why investors should dip their toes in Water Infrastructure in 2025

  • Reflections on Raymond James’ latest Water Quarterly: 

  • Reuse is the emerging choice for urban water supply resilience. 

    1. PE deals highlighted are for solid, non-hyped up companies. Boring is good, especially because they get to boringly predictable revenues.

    2. P/E ratios are all over the place, but higher quality companies are reaching 16X EBIDTA multiples or higher.

    3. An excellent piece from Christophere Gasson. Service contracts, especially for industrials, will be more common. Likely a reflection of having more treatment as a service vs upfront capital sales. EPC costs are high and uncertain, so minimal onsite assembly will be critical. Water reuse continues to grow, but desal isn't keeping up. Perhaps Flocean can do something about that.

  • The adaptation and resilience wave begins (or continues)...

  • The latest PFAS treatment story from GWI emphasizes mobile systems that are pre-engineered solutions. These solutions are faster to deploy and can have much lower EPC cost and risk exposure. Veolia, Xylem, and Nijhuis are mentioned as the leaders in mobile PFAS. Glad to have Aclarity in the portfolio.

  • Nice coverage from GWI on our investment in AlgaFilm. Positive & technical.

  • Turing raised a $14m round led by Safar Partners. Read more here.

Team

  • Excellent work as we criss-crossed the world, no skipping a beat either in the deal processes or in founder support. Nicely done. 

  • Looking forward to our AGM on March 26th, and our Founder Forum May 7th/8th. Prep process has been very calm, thanks to Jessica and Marissa. 

BIV Insight/Visibility

We’re Reading/Listening/Watching

  • Excellent start to North Woods.

  • Graham Duncan on ILTB. Genuinely amazing listen. 

  • Fascinating new water map from National Geographic Explorer, Plinio Guzman, that captures how urbanization, climate change, and human activities have transformed our water bodies since 1984.

  • The Code Breaker: Jennifer Doudna, Gene Editing, and the Future of the Human Race from Walter Isaacson. A fascinating and well-written view into the advent of scientific innovation, and a good reminder of what happens when top science and technology meet serious operators.

  • White Lotus, obviously, and The Pitt is icky but good. Noah Wyle back in them scrubs…

Things to Work On

  • Perseverance as the disruption (not the Clay Christensen kind) escalates.

  • Staying close to the portfolio as they deal with the bumps. The portfolio is relatively unexposed for an array of reasons, but constant vigilance required. 

Thanks so much as ever.

Tom Ferguson
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