Investing in Water Aligning Investment Strategies with Water Innovation 2025

Executive summary Water solutions offer a promising investment opportunity, with applications spanning virtually every industry, but tapping into water’s full value requires a tailored investment approach. As global demand intensifies and the impacts of climate change, population growth and resource stress become more acute, water is attracting attention from investors drawn to its diverse opportunities and its role in building long-term resilience. Long overlooked, water is now gaining recognition as a high-potential opportunity, drawing interest from a broad spectrum of investors eager to back innovative, scalable solutions. Early-stage water innovation is a dynamic part of the investment landscape, presenting a compelling business case for strengthening water systems that have traditionally been slow to adopt new technologies. With increasing deal sizes and exit opportunities, water solutions are increasingly attracting first-time investors. Capital providers most interested in early- stage innovation must understand the unique considerations involved when investing in water solutions. Barriers to investing in water have historically been the perception of the abundance and low price of water, fragmentation in the water space and long development cycles. Yet these same challenges can create distinct opportunities for investors who are able to spot shifting conditions, identify favourable environments and determine where and how to focus their efforts. Moreover, because water solutions are relevant across nearly every industry, the investment potential extends far beyond traditional utilities. Understanding these complexities is critical for successful and strategic engagement. There is a wide array of investment opportunities within water solutions. From innovative technologies in water treatment and efficiency to nature-based solutions, circular water systems, and digital and artificial intelligence (AI) solutions, water solutions can accommodate diverse investor profiles. Whether impact-driven, returns-focused or strategically aligned with environmental, social and governance (ESG) goals, there is space for all types of capital. Insights from first-time water investors in this paper shed light on how to effectively enter and navigate the space. Their experiences highlight practical strategies, common misconceptions and vital considerations that can help new entrants build confidence, mitigate risks and identify aligned opportunities. As momentum continues to grow, now is the time to inspire investment in water – not only to unlock returns but to secure a sustainable future.Water solutions offer adaptable, future-oriented opportunities that align with a range of investment strategies. DigitalPaani: an IoT- enabled platform to drive operational excellence in water management. Investing in Water: Aligning Investment Strategies with Water Innovation 5