United By Purpose

Ten years ago, an engineer and an actor got together, determined to find answers to the desperate situations we witnessed all over the world. We had each been working for many years amid one of the greatest needs and most far-reaching philanthropic efforts of modern times: the global water crisis. In 2009, we merged our separate organizations and created Water.org.
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The idea that brought us together was a simple one, as any uniting idea should be: that everyone should have access to clean water. We had both met families living at the base of the economic pyramid who struggled every day to pay for each liter of water; we saw those with the lowest incomes pay the most for it and get the most contaminated water for their money. We met people who had to spend much of their days looking for water and for a place to use the toilet. We saw this enormous daily expense, and we realized that families could be healthier, more productive, even better educated, if they could access small, affordable loans to finance household taps, toilets, and other lasting improvements to their lives.

We named this solution WaterCredit, and with it Water.org has enabled more than 25 million people to obtain the means to a lifetime of safe water and sanitation. We partnered with microfinance organizations across 13 countries to mobilize 5.7 million loans worth US$ 2.1 billion in commercial capital for water and sanitation. The proof of the model is a repayment rate of 99%. Along the way, the original partnership between our two water organizations turned into partnerships involving hundreds of organizations.

To Partner is to Multiply and to Learn

In the simplest model of partnership, organizations partner to share a burden. I do what I do best, and I count on you to do the same.

A more sophisticated model recognizes the potential for synergies, how together we can carry even more of the burden, to become greater than the sum of our parts.

But the benefits of partnership go beyond even this.

Perhaps because of how Water.org started, we tend to see partnering in another light. Every partnership offers an opportunity to learn from people who operate in very different spheres, and to learn together as we advance together.

Four key things we’ve learned through our partnerships

1. The People at the Base of the Pyramid Can Solve This Problem Themselves
Back in the 1990s, we knew people were throwing money away every day to get access to water and toilets. The water they gathered, although free, had a hidden cost. Sometimes the water was contaminated, costing people their health. And always water collection cost people their time.  Around the world, women and children spend 200 million hours each day collecting water. We knew they were open to an opportunity to trade this expense for an affordable and sustainable solution that would buy them this part of their lives back to do something better. They needed a partner to help them.
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We see our role as being a catalytic partner. We have helped microfinance institutions, self-help groups, community-based organizations, governments, utilities, and supply chain entities recognize that the people at the base of the pyramid, empowered with access to finance, really can solve the water crisis.

2. Capital is Critical
The demand from individuals for affordable financing to provide access to water and sanitation was an US$18 billion opportunity. Existing financing didn’t come close to meeting the market demand. Our experience working with financial institutions and water and sanitation enterprises in emerging markets taught us that, with access to more dedicated capital, we could reach more people, more quickly.
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And so, in 2017, we founded a new organization, WaterEquity, the first-ever asset management firm dedicated to ending the global water crisis, with an exclusive focus on raising and deploying capital to financial institutions and water and sanitation enterprises in emerging markets.

In April 2017, WaterEquity launched a US$50m impact investment fund to invest in financial institutions and water and sanitation enterprises in India, Indonesia, Cambodia, and the Philippines. Composed of two equity classes and a catalytic debt facility, this fund also includes a US$5m first-loss guarantee that allows investors to cultivate a nascent market with low risk. Additionally, Bank of America provided a US$5m zero-interest loan for this fund.  Bank of America’s support helped to attract investments from foundations, corporations, high-net-worth individuals, and development finance institutions.

As of March 2020, WaterEquity’s first two funds have successfully reached 1.6 million people living in poverty with access to safe water or sanitation.

3. Synchronicities can be Powerful
Our research and our partners tell us that in some communities, installing a tap or toilets isn’t the full solution because of ingrained practices.
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Water.org has been collaborating with UNICEF, the largest organization promoting health and hygiene education around the world. One of UNICEF’s major goals right now is to end open defecation in the places where it is still the first, sometimes only, option for many people. Through our collaborations, we collectively harnessed the power of linking education directly to accessible solutions. UNICEF led the community-level education that created demand for a toilet or tap, and we enabled household-level financing, thus removing a critical barrier to action. Where we have knitted our efforts together in India and the Philippines, UNICEF has seen marginalized low-income communities use accessible finance to construct the toilets and taps that make a sustainable change in behavior possible. Recently, innovative finance became one of UNICEF’s global strategic priorities.
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Over the years, we have learned how much of a boost there is to water solutions from community-based demand generation when we work in the same places as UNICEF.

4. Governments can Multiply Impact Exponentially
UNICEF’s amazing network of government relationships has inspired and helped us to grow our work in the water policy arena. Having been a key member of a coalition that successfully lobbied to make water and sanitation part of Priority Sector Lending for India, our team realized the multiplicative power of combining bottom-up and top-down approaches. Water.org’s strategic plan now includes systems impact: impact on the whole enabling environment, the policies, practices and the systems that affect anyone who wants to invest in their own water solution.
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This partnership with UNICEF only scratches the surface of our work with institutional and sector-level partners, networks, and government entities. The aims are highly contextual, and there is no script for these kinds of partnerships. It’s a matter of finding everyone who has a positive role in the sector — the actors, as the jargon has it — and connecting them to one another to accelerate impact.

Actors and Investors

We always feel like “actors” is an odd word to use here — and not just because one of us is an actor of some experience. The word is also an imperfect fit whenever talking about water, because everyone is an actor. Everyone must make decisions about their water. For some, that means paying a monthly bill and turning the tap. For others, it means walking an hour each way to collect it, a brave and exhausting daily action.

What interests us is not just water actors, but water investors. This highlights the active investment of what many other organizations dub their “beneficiaries.” Yes, they benefit from our work, but so does everyone else – businesses that will have healthier workers and governments that will have healthier and more productive citizens.

Millions of people can make lasting investments in safe water or a toilet if empowered to do so by the investments of others. Investment on every possible level is what will end the water crisis and bring water and sanitation access to all. We are proud to partner with all the investors, to align our efforts, to leave no one behind, and to continue to learn and to innovate together.

Understanding the Water Crisis

785 million people (one in 10) lack access to safe water and two billion people (one in three) lack access to a toilet.
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Providing access to safe water and sanitation can empower people with time for school and work, while contributing to improved health worldwide.