3 start-up founders on the need and opportunities for investing in water innovation

Water is indispensable to human life, underpinning public health, agriculture, and even energy production. In 2021, the economic use value of water was estimated at $58 trillion, equivalent to the combined GDP of China, Germany, India, Japan and the US.

Yet, investment in water-focused innovations remains disproportionately low compared to other sectors, often relegated to the sidelines in favour of industries perceived as more lucrative or less risky. Despite the trillions of dollars associated with the global water market, innovators report that attracting investment has proven challenging, leaving a significant gap in funding for emerging water technologies.

Investing in Water: A Practical Guide, a recent paper published by UpLink, the early-stage innovation platform of the World Economic Forum, highlights the perspectives of a few investors who are familiar with the water innovation space. "The time to invest is now," some of them say. "The water investment network is kind, collaborative, and underserved, with significant opportunities and value that can be unlocked."

The paper encourages climate-focused investors to understand regulations and the market, emphasizing the need for a holistic view and a water lens when investing in climate and nature. "Engaging systematically rather than opportunistically can yield high returns," according to the document’s insights.

As part of Climate Week and the Forum’s Sustainable Development Impact Meetings in New York City, UpLink and partner HCL Group gathered 10 water-focused start-ups who are part of the Aquapreneur Innovation Initiative, to support their entrepreneurial journey through workshops, networking, and learning opportunities.

A key takeaway from the event was the need for water stakeholders to better communicate and engage with non-water investors, helping them understand how investing in water can drive benefits across the industries they already invest in.

In this context, three of these innovators shed light on the current state of funding for their water innovations, highlighting both the obstacles they face and the potential for transformative investment.

Greg Newbloom, CEO, Membrion

"Membrion is fortunate to be among the best-funded water technology companies; however, securing investment remains a challenge. The water market is a trillion-dollar industry, yet it is highly localized, extremely commoditized, and slow to adopt new technologies — factors that complicate the traditional venture capital model.

"As entrepreneurs, our greatest challenge is to demonstrate how we can break the mold and deliver venture-scale returns at a comparable growth speed, which often necessitates disruption across technology, pricing, business models, and marketing. The impact of Membrion’s electro-ceramic desalination (ECD) technology is profound. Currently, industrial wastewater containing regulated metals is 'treated' through a costly combination of chemical lime, trucking, and incineration, which results in significant greenhouse gas emissions and the potential leaching of toxic metals into groundwater.

"ECD can transform this industrial waste into clean water and valuable metals, enabling a circular approach that reduces GHG emissions by 90% and eliminates toxic leaching. This innovative solution operates under a service model with no upfront costs for facilities and a payment structure that is lower than their current expenses, meaning no green premium."

Karina Peña, CEO and Co-founder, Field Factors

"Our investment journey has primarily been self-funded, relying on grants and public funding to develop our technology. As we scale, however, securing external capital has become essential. Over the past two years, we’ve engaged with various investors and encountered a recurring challenge: many climate-focused VCs overlook water management as a critical aspect of sustainability.

"Those who do invest often limit their focus to traditional industrial water treatment technologies or software-based solutions, leaving innovative urban water management underserved. This gap presents both a barrier and a unique opportunity for forward-thinking investors. The water sector, particularly in deeptech hardware, represents a largely untapped opportunity for impact investors.

"As industries expand and global water infrastructure ages, the demand for cutting-edge water management solutions is growing exponentially. Strategic investments in hardware-based water innovations can drive impact across multiple sectors of the economy—from equipment manufacturing to service providers—creating a ripple effect of job creation within the green economy. Moreover, by addressing critical water challenges, such investments contribute to greater environmental resilience, ensuring sustainable water management for both urban and industrial communities."

Juan Carlos Escobar, Founder and CEO, Aquakit

"Our investment journey at Aquakit has largely relied on grants, which have been pivotal in driving our growth by allowing us to make essential investments in infrastructure, marketing, and sales strategies. However, raising capital remains challenging due to the perceived risks associated with water innovation. Many investors gravitate towards traditional industries with quicker returns, often viewing water-related innovations as niche and unpredictable. Despite these hurdles, we remain optimistic that heightened awareness of climate resilience and sustainable water management will attract more private investment into this vital sector.

"If we can secure capital from impact investors, it would significantly transform the water innovation landscape in Bolivia and Latin America. With the region's urgent need to build a green economy, such investment would catalyze the development of environmentally friendly technologies, leading to job creation in critical fields like engineering and science. This not only addresses pressing water challenges but also fosters long-term economic growth. Additionally, advanced water recycling systems would reduce environmental degradation, enhance water security, and help create green urban spaces, thereby improving the quality of life for low-income populations. By generating added value through innovation, we can position Bolivia as a leader in green technology and transform the region into a hub for sustainable development."

By joining as early movers, investors can help shape both local and global markets while addressing pressing water challenges. Investment in water technology is essential for addressing the climate crisis. Modernizing water infrastructure and adopting smart water solutions can build resilient water systems that support economic growth, protect public health, and mitigate climate impacts.

For more insights on the needs and opportunities for investing in water innovation, read Investing in Water: A Practical Guide and watch the UpLink session Investing in Water Innovation, also available through the World Economic Forum’s Agenda Dialogues podcast.