In the journey of almost every startup, there comes a time when the realization sets in that the product, the value proposition, the channel to market, or the business model is not working. Then it’s time for “The Pivot”–basically rethinking what one is trying to do and reformulating the entire business. Learning to pivot is critical to a startup’s success.
Chris presented at our second cleantech meetup in 2018. When he started out he wanted to build a company that would accelerate water conservation. In 2016, that was creating a water rights trading platform launched in 2017. Through his work, he found another problem and another set of potential customers. Lenders, like banks, wanted to better understand how water affected their loans risk. They didn’t know how to do that well. They were eager for some kind of tool that could help. That was one of those “A-ha” moments for Chris. He had identified a “must-have” product. That kind of discovery is like finding a diamond. It is the best thing that could come from a “customer discovery” process. The trick is in listening carefully to feedback and not trying to convince a reluctant customer that they are wrong. It’s a critical skill.
Based on listening to early feedback, Chris pivoted AQUAOSO to create a water risk analysis system, like a FICO score but for water. This is important to lenders and investing because the risk from climate change includes financial risk from extreme weather events like flooding and drought. For these extreme events, the availability or quality of water is a leading risk indicator. He could offer this as a SaaS solution and collect user fees. He has created a trademarked Water Security Score that is becoming well-recognized in the industry, as well as related water databases.
Now AQUAOSO is more of a Fintech company rather than a water-savings broker. Being able to address water risk provides value to lenders to agricultural enterprises and Chris quickly got a dozen very satisfied customers.
- Agriculture businesses can see how the risk can affect their business, helping them make better decisions.
- Financial institutions can use the information to mitigate risk and improve borrower relationships.
- Insurance companies can better understand the water risk their products carry and can take action to reduce it.
- Investors can better understand risk and decide to responsibly increase shareholder returns.
AQUAOSO has recently raised significant funding and is beginning to grow to a meaningful scale. Their pivot was crucial to getting traction with customers and investors. Here is a testimonial from one of their customers:
“Using AQUAOSO has helped me cut down on research time and has provided me more water information than ever before! It is now the first step in my loan underwriting process and it has allowed me to devote more time toward expanding our loan portfolio.”
The AQUAOSO website is a great example of how to present valuable information to clients and educate them on the value of the product. It is worth a look.
ABOUT THE AUTHOR
Thomas is the Executive Director of CleanStart. Thomas has a strong background in supporting small businesses, leadership, financial management and is proficient in working with nonprofits. He has a BS in Finance and a BA in Economics from California State University, Chico. Thomas has a passion for sustainability and a commitment to supporting non-profits in the region.