WaterHealth International, a private company and Acumen Fund investee, was covered in last week’s online BusinessWeek, which also includes a video featuring the founder, Tralance Addy (tipped from Acumen Fund’s blog). The company aims to “provide sustainable access to clean, safe water to all, including the poorest communities. ” Their work in India includes over 200 WaterHealth Centres, mostly in Andhra Pradesh, and they are expanding to meet the demand from this pressing problem.
The BusinessWeek article notes why this venture is interesting:
WaterHealth typifies one of the latest trends in social entrepreneurship. A new generation of leaders believes it can do more for poor people if they operate as profit-making businesses rather than donor-backed organizations. WaterHealth has designed both a proprietary purification process and a simple facility for housing the equipment. It sells the systems to villages, helps secure financing, and runs the plants. After eight years, when the villages pay off their loans, the money they make from sales of water goes straight to their coffers—available for village improvements.
The article quickly touches on a debate about WaterHealth’s business model, as opposed to Byrraju Foundation’s model. WaterHealth requires its communities to invest in the system through loans, whereas Byrraju provides subsidies and the water plant is a shared investment. The debate highlights the staple question of sustainability – what is the best approach to ensure long-term feasibility? More specifically, is there a finance scheme that works better than others in achieving the intended goal?