Summary:

Entrepreneurs and investors have long believed water tech represents the next big market. ET Water Systems hopes to ride this wave and announced Monday that it had raised $2 million for a new irrigation control and management technology.

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Entrepreneurs and investors have long pegged water as a commodity with a rising price tag and have started to look to technology for conserving water as the next big market. ET Water Systems hopes to ride this wave and announced Monday that it has raised $2 million for a new irrigation control and management technology.

ET Water, based in Novato, Calif., is the water market counterpart to companies that develop devices and software for controlling electricity use at homes and businesses. The company’s hardware and software enables property owners and landscapers to fine-tune their land’s irrigation needs based on the area’s weather patterns, soil conditions, plants and other parameters. Users enter this type of data online to create an irrigation plan, which can be adjusted daily, Pat McIntyre, CEO of ET Water, explained to us in a phone interview.

A cloud-based server for the company stores this data, calibrates the amount of water needed and communicates that information to a two-way communication device and irrigation controller at the property.

The new round came from three existing and undisclosed investors. The round isn’t closed yet, though McIntyre declined to specify a fundraising goal. ET Water plans to use some of the new round to expand its distribution network nationally. Most of its products are sold in the western U.S. Its distributors include Imperial Technical Services in Los Angeles and Horizon Distributors based in Chandler, Ariz. Overall, ET Water has raised about $10 million since its inception, McIntyre said.

The company has been around since 2002 and launched its first set of products and services in 2006. It started with a product called SmartBox that replaces conventional irrigation controllers, which are essentially simple timers that can only be adjusted by hand. ET Water then introduced its SmartWorks product that was designed to fit into the box containing a conventional controller so that users can swap out the old components with the SmartWorks device.

The latest controller from ET Water no longer requires the replacement of the old controllers. Called HermitCrab, it’s a dongle that attaches to the existing controller to override the old settings and converts it to a smart controller, McIntyre said. HermitCrab is low cost and enables ET Water to target home owners, he added.

The company shipped its first batch of HermitCrab devices last week. ET WAter generates revenues by selling the hardware and a free first-year subscription to its software service to distributors of irrigation equipment. Software subscription for the following years runs $200 per year, McIntyre said. The company also licenses a smart phone application for $99 so that users can activate or suspend irrigation from wherever they are.

ET Water’s distributors generally market the HermitCrab for about $800. SmartWorks runs about $1,700 while SmartBox averages $2,000, McIntyre said.

Despite lots of talk about water being a precious commodity, it remains cheap enough to not become a worry. Water management technology wouldn’t become popular without a greater awareness by consumers and businesses to conserve its use. Other smart water controller developers include HydroPoint Data Systems. In a related market, EnerNOC recently bought M2M Communications, whose equipment turns down pumps and irrigation systems at farms and utilities to conserve electricity, a bulk of which is used by farms and other businesses to move water.

Landscaping accounts for about 50 percent of the water use in the western U.S. and “half of that is wasted,” McIntyre said. He said more cities and water districts are implementing tiered pricing systems that charge heavy users higher rates. States such as California are requiring water agencies to reduce per-capita water consumption, and that also will nudge water service providers to use tiered pricing to encourage conservation.

Photo courtesy of John Schanlaub via Flickr.

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