Investing in Water Aligning Investment Strategies with Water Innovation 2025

2.1 Water innovation as a strategic investment for different investor types The water opportunity for different investor types FIGURE 3 Less risk-tolerantMore risk-tolerant Angel investors Risk tolerance Very highReturns Seek very high potential returns from early-stage investments, with a high failure rate balanced by occasional big winsPrimary interest Early-stage innovation and backing visionary foundersSecondary interest Personal impact and sector-specific passionTime horizon Short- to medium-term (generally 5–7 years, though can vary with opportunity) Venture capital Risk tolerance HighReturns Target very high returns through rapid scaling and successful exitsPrimary interest Financial returns via scalable, high-growth companiesSecondary interest Market disruption and economic growthTime horizon Short- to medium-term (typically 5–7 years) Impact funds Risk tolerance ModerateReturns Accept moderate financial returns in exchange for strong social/environmental impactPrimary interest Achieving measurable social and environmental impactSecondary interest Financial sustainability and contributing to economic growthTime horizon Medium- to long-term (generally 5–10 years, adaptable based on project impact) Corporate venture capital Risk tolerance ModerateReturns Aim for returns, but may be secondary to strategic valuePrimary interest Strategic alignment with core businessSecondary interest Financial return and innovation supportTime horizon Medium- to long-term (5–10 years based on strategic needs) Family offices Risk tolerance ModerateReturns Aim for balanced, long-term returns with preservation of wealthPrimary interest Long-term wealth preservation and legacy-buildingSecondary interest Sustainable impact and steady financial growthTime horizon Long-term (often 10+ years, with flexibility depending on goals) Regional development funds Risk tolerance LowReturns Low–moderate Primary interest Economic growth, infrastructure, job creationSecondary interest Sustainability and resilienceTime horizon Long-term Investing in Water: Aligning Investment Strategies with Water Innovation 18