When the next big inventions improve the way water is used, purified, distributed or disposed of, the Hamilton Mill business incubator in Hamilton’s former municipal building hopes to be leading that wave of innovation.
Hamilton, home to what has been proclaimed the “World’s Best Tasting Tap Water,” and municipal owner of three hydroelectric plants (two on the Ohio River and one along the Great Miami), hopes to tap into a nearly $500 billion worldwide industry of water-related technologies.
Proponents see the area as a potential “Silicon Valley for water” that can lure companies to the region and Hamilton, which can be especially inviting to start-up firms and larger companies alike because Hamilton’s city government operates its own water, sewage, electric and gas utilities.
Melinda Kruyer, executive director of Confluence, a non-profit “water-technology innovation cluster” that covers the region of Dayton, Greater Cincinnati, Northern Kentucky and Southeast Indiana, believes companies from around the globe will be involved with this region’s “water tech” efforts. In the past six months, companies from Canada, China and Israel have joined the Confluence consortium of government agencies, universities, large and start-up companies and others.
Why does she have such high hopes for water?
- Cincinnati is home to the U.S. Environmental Protection Agency’s internationally respected Andrew W. Breidenbach Environmental Research Center near the University of Cincinnati campus. It is EPA’s second largest research and development facility, a leader in water research, bio-remediation and pollution prevention.
- The U.S. Air Force Research Laboratory in Fairborn applies leading-edge aerospace research to water needs.
- The region was one of three water-technology centers identified by the EPA and Village Capital, based in Washington, D.C., which funds entrepreneurs to solve global problems, such as water issues. The other areas targeted for water research were San Diego and Milwaukee. A 2010 study found that Greater Cincinnati has more water-technology patents per person than any region of the country, with 258. That’s 96 connected with drinking water, 153 for sewage, and 9 for storm water. The Dayton area has 40 such patents (8 drinking water, 32 for sewage).
“This region has 100 years of water technology innovation,” said Kruyer, whose organization was launched in part by the U.S. EPA and other water-technology interests. “The very first water technology in the country that was federally funded happened in Cincinnati in 1913.”
Add in such organizations as the drinking-water utilities in Cincinnati and Dayton, Cincinnati’s Metropolitan Sewer District and Northern Kentucky’s Sanitation District 1, the University of Dayton, UC, Miami and Xavier universities, and such companies as Procter & Gamble, a lot of thought is given locally to water.
“We have over 6,000 scientists in the area, and they are implementing nearly $4 billion worth of research annually,” Kruyer said. “So when you look at that, we have this incredible intellectual capacity that’s unsurpassed.”
“You add to that, we have this incredible suite of assets,” Kruyer said. “No. 1, in order to test the technologies, you’ve got to have water. So we have more test beds in this region probably than any other area. And that’s because we’ve got thousands of miles of rivers and streams, and we’re sitting on a 1.5-trillion-gallon (underground) aquifer, so as other parts of the country are struggling, we are water rich.”
The attack plan
The companies pool at the Hamilton Mill business incubator, which focuses on helping companies involved with advanced manufacturing and clean technologies, along with their supportive software applications, organizations across the region have decided. The mill was chosen to manage Southwest Ohio’s water-innovation cluster.
Chris Lawson, a city-paid employee who is on loan to Hamilton Mill, serving as its executive director, said the water-tech initiative, which doesn’t yet have a name, will provide start-up companies and mature ones alike mentorship, help arranging for venture capital, and most importantly, companies and utilities that are willing to beta-test their products. Those same testers likely will become the firms’ customers, he said.
“Key to our success is the city as a lab,” Lawson recently told the city council. “And many (city employees) have actually helped spearhead the successful deployment of this program effort, which in sum is basically start-ups getting to beta-test their products with members of our community,” he said.
Hamilton’s own municipal utilities, including water, sewers, electric and gas, already have been willing to beta-test, Lawson said. “That has attracted start-ups that would have never found a home in Greater Cincinnati, but they found it here.”
Kruyer notes countries like Brazil and China “are desperate for the technology to have safe drinking water, and sewage and all that.” Not to mention, she adds, cities closer to home, like Flint, Mich., dealing with tainted drinking water.
There are many obstacles converting water-technology ideas into commercial projects, Kruyer said.
Most investors in technology expect technology to be developed in 3-5 years, “and 7-10 years would be a long time,” she said. But water technology “traditionally has taken 12-15 years to get that technology from the lab through to commercialization. With the challenges you see today in Flint, Mich. (and other U.S. cities), we don’t have 12-15 years to find solutions. So part of what we’re looking to do at Confluence is identify and take down those barriers.”
Confluence has helped one way: Kruyer said a small company’s executives may overcome many hurdles to get its technology approved by the Ohio EPA. But then: “Then they have to turn around and do that all over again in Kentucky. And that’s more time, and more effort. And then they go to Indiana, and they’ve got to do it all again.”
Confluence in 2013 got the leaders of those three states’ EPAs and asked, “Would you be able to come together, harmonize that protocol, so that a technology company only has to do it once?” Kruyer said. “And we signed a memorandum of understanding.”
Hamilton City Council was pleased to hear progress toward the water-tech initiative. Thanks to Hamilton Mill, Mayor Pat Moeller said, “There will be meetings here, decisions made here, ideas come to pass in Hamilton, Ohio.”
Kruyer, Lawson and others see an ocean of potential, and already have seen progress, such as with KWRiver Hydroelectric, which plans next spring to install a cross-flow hydroelectric generator in Hamilton’s low-level dam off Neilan Boulevard that creates the pool of water through the city’s downtown area.
“Hamilton Mill itself has been extraordinarily helpful,” said KWRiver Hydroelectric co-founder Paul Kling of Colerain Township, who thanks to the incubator linked up with a West Chester firm that is man his patented products. Hamilton Mill and letters from city leaders helped the company win permission from the Miami Conservancy District for the installation, he noted.
In the past two years, Hamilton Mill has worked with 17 new companies that created more than 30 jobs and hold 16 patents. KWRiver held two patents before it joined the million, and added another, Kling said.
“Once we get it in the water, I think that’ll bring a lot of attention to Hamilton,” Kling said. “The devices are being made in West Chester, so it’s not really Hamilton, but it’s in the region, anyway, and it’s a new manufacturing capacity that was never there before.”
Here’s part of the approach Lawson says will help water-tech businesses at Hamilton Mill: “We want to compile a comprehensive list of problems from a number of public/private organizations that deal specifically with water,” he said. “And then we want to take those problems, and when we go out and start marketing the program, we want to actually try to align start-ups that actually solve problems.”
“In essence, they get an automatic mentor and potential customer if they solve the problem,” he said. “So it’s more than just they get a potential investment possibility. They actually get something I think far more important, which is an actual customer.”
Among details still being worked out are the program’s details. For example, how often will distant companies be required to come here to interact with those they are working to help?
Among many needs, said Kruyer, are things like digitizing water pipes to find out where they’re leaking, or to know when to turn on certain pumps.
“We have just created a regional water-utility network,” she said. “We have over 90 utilities in a 100-mile radius, and each one of those has different challenges. We have really big ones — Dayton, Cincinnati Water Works, (Cincinnati’s Metropolitan Sewer District) — but we also have Monroe and Fairfield.”
Each of those utilities “has different challenges, and we pulled this network together to really create that market so that when we have technologists who are working in that space, that they are able to connect directly with a lot of these utilities,” Kruyer said.
There’s big money in water and wastewater (sewage), Kruyer says: “Globally, there’s $495 billion being spent on water technology every year, and in the United States, it’s $95 billion a year. And those are growing 6-8 percent a year.”
Based on the region’s population, patents and other factors, “Our region should be bringing in $2.2 billion annually, growing at 6-8 percent per year,” she said.
A “retention pond”?
But what’s to keep a start-up here after it makes a huge worldwide splash?
Much like other Hamilton Mill agreements with start-up firm, there will be “no contract that says if you come to the Hamilton Mill incubator that you must stay in Hamilton,” Lawson said. “But we believe that people are much more likely to stay in the community that supports them, that during those critical first steps, hand-held them through those. They’re much more likely to take root in that community and actually stay in that community.”
That theory has proven true with other companies, he said: “It happened with ODW (Logistics and Transportation Services).”
It also happened with Municipal Brew Works, which also uses space in Hamilton’s former municipal building: “They stuck with it because we stuck with them. So we believe that while there is no hard-and-fast contract that says, ‘You must locate here,’ people will locate with the people that gave them support during those critical times. They remember the people that signed their first contracts.”
Lawson credited another regional organization, Centrifuse, an innovation-fostering group launched earlier this decade by the Cincinnati Business Committee, for fostering Hamilton Mill within the regional economic “ecosystem” that centered the effort in Hamilton.
“When you think about pioneers, at the very essence, they’re entrepreneurs. They see opportunity when others don’t,” he said. “They trail-blaze and venture into uncharted territory, where others fear. And that was the type of legacy that built this city, and we believe the type of legacy that would rebuild it.”
“But central to that future was partnership,” he told council. “You don’t see one pioneer out there — because that person would be dead. You would see a team, and you have to build a team just like you’re a start-up. And part of our team was Centrifuse.”
Meanwhile, Lawson quipped recently to council about the recently opened micro-brewery, “Municipal Brew Works is not a beneficiary of Centrifuse, but it gets them up here for meetings a lot easier now.”
“One of the things I’ve been impressed with is the city of Hamilton, and how forward-thinking your leadership is,” Kruyer said. “I think Hamilton Mill is an example, and what you’ve done is really leveraged the assets that you have in water — best-tasting water in the world. With your utilities, you’re very open to open to bringing in technologists and new thinking to an industry that has been very conservative, because the task of keeping our drinking water safe is taken very seriously and can be a little more risk-averse than other areas.”
“The bottom line is that we have this incredible opportunity right here to leverage these assets, to be known as globally one of the top ecosystems for water technology — one of the places you’d want to go to invent and innovate,” Kruyer said.