5 Reasons Water Utilities Won’t Buy Your Tech
Updated: Mar 11, 2020
OK, so yesterday I posted an article on California Agriculture, and some observations as to why they won’t buy #AgTech. A few friends asked me why I didn’t write about water utilities, given I spent nearly 15-years of my life serving that sector. Well, my existing client base is deeply rooted in Agriculture. We are navigating it daily with AQUAOSO and our solution to make managing and trading water rights easier, thus the focus.
However, I certainly have a few lessons from the water utility space as well. For those with a #startup in #watertech, here are some of the reasons most seasoned water professionals understand all too well.
It’s not because utilities are risk adverse or slow to adopt technology – it’s probably more about you!
1) “WTF are you selling?”
Seriously, if you can’t succinctly explain what it is your product does in less than a few sentences, then you need to rethink your messaging. I’ve known many great engineers (both software and civil) who could not get to a simple answer. Remember, simplify the complex!
Water utilities will not buy a product if they don’t understand it.
Membrane technologies, AI, Analytics, Master-plans – typically, you are not selling these things. You are instead selling reduced energy, increased optimization, found revenue, capital planning prioritization, thought leadership, reduced costs, (insert your value prop here). Make sure what you are selling is simple to understand – you can get into the technical details later.
2) It Does Not Add Value
Before you knock on a water manager’s door, you had better understand that you will be adding significant, preferably de-risked, value to their operations. If your tech does the exact same thing as the existing solution, why are they going to bother?
There needs to be a significant increase, return, cost savings, etc. for implementing your technology or service.
This means you must understand which utilities your tech will best serve. With more than 56K water utilities in the US, there are plenty of opportunities. You need to learn where you can add value. Leverage the right tools to help you find the right customers with companies like WatrHub.
For engineering firms, this becomes harder as engineering services becomes more of a commoditized service (GASP!) Not to worry, though, there are many ways for engineering firms to add tremendous value which I will share in a later post.
In the meantime, if you are a #watertech #startup, pay attention to the engineering firms. There may be a few of you that can go direct to the utility, but in many cases, these firms are the gatekeepers with trusted relationships and can help you define value by scoping your technology specs into the (dreaded RFP) process.
3) You don’t understand the business of the water utility
Investor Owned Utilities (IOU), Special Districts, Municipal, Combined – while they may all have the same public service goal of providing safe, clean, uninterrupted supplies of drinking water to their customers at the lowest price their business models vary.
You need to understand the difference in capital and operating expense structures for an IOU vs. Municipality. Or the board reporting makeup of Municipal vs. Special District Utilities. Figure out how the money flows and who really makes the decisions.
It might surprise you to find that all utilities are not managed the same.
4) You are talking to the wrong person
I know you like Joe in IT, but he may not be the right guy to buy your technology if it improves customer service. And Terry in Operations, he may not be the decision maker to buy advanced analytics, no matter how much fun he is at the conference after party.
Learn to identify the personalities inside of your customer base, and the reasons they make decisions.
Board member won’t approve a purchase that risks their election in 3 months. Figure out how to triangulate across the utility. There is a reason it takes 10 meetings and 18 months to sell to most water utilities – and it usually has to do with talking to the wrong people at the wrong time.
5) You are not showing up
Maybe you have noticed a common theme from my other articles. If you don’t show up (i.e. Building Trusted Relationships) your chance of survival in the long term diminishes greatly.
You need to be there for your customers – past, present and future.
I don’t mean go to every conference, that program will lead to bankruptcy for a young company given the number of events that take place every year. In fact, I firmly believe that #startup #watertech companies should AVOID most conferences unless they are on a panel, or better, presenting with a customer. Otherwise, its a time and money drain. But I digress, that’s another topic altogether.
Rather, help them out with other problems if you know of a solution. Help them become hero’s in their own organization. Maybe you need to do some of the work for them – like preparing the board presentation on their behalf. Whatever it is, show up regularly. They are human after all.
Don’t be an ass. I know it sounds crude, but seriously, the water sector is made up of hardworking individuals. Utility managers, operators, IT staff, customer service reps – they are mostly awesome people trying to do the right thing with dwindling resources. I love this space in large part because of the people.
I have not yet found another industry with the same level of caring professionalism as the water sector. So be kind.