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AqWise biologically purifies sewage and effluents

Aqwise March 2017

AqWise is an Israeli cleantech company that purifies sewage produced by Coca Cola, Unilever, and Nestle.

AqWise is a good example of a cleantech company that usually operates below the radar. Founded in 2000 by Eytan Levy and Ronen Shechter, the company is currently managed by CEO Elad Frenkel. AqWise has 70 employees: 50 in Israel and the rest in India and Europe. AqWise does not provide precise information about its business, but Frenkel says that its turnover is in the tens of millions of shekels, and that the company is making a profit. AqWise has raised $15 million to date, a modest sum, given that the company has existed for 17 years. Investors in AqWise include foreign concerns from Mexico and India, IDB Development Corporation Ltd. (TASE:IDBD) subsidiary Elron Electronic Industries Ltd. (TASE: ELRN), and Israel Cleantech Ventures.

The local cleantech industry began in Israel’s kibbutzim (collective communities) and moshavim (cooperative communities), with an emphasis on kibbutzim. The main purpose was to deal with urgent problems arising in these communities, rather than the business perspective represented by AqWise. “AqWise was part of the first wave of non-kibbutz clean-tech companies,” Frenkel says. “The company developed sewage purification technology that has been sold in more than 30 countries to date. We take sewage from a nearby town or industrial plant, purify it, and then release it to nature or further use in industry.”

Biological treatment

AqWise is developing plastic elements for biological treatment of water. The purification solution is based on unique, economical, and innovative biological treatment Attached Growth Airlift Reactor(AGAR) technology, which combines a specially structured biomass carrier with a special aeration system. “In recent years,” Frenkel says, “we have installed the system in hundreds of places around the world in a variety of industries, such as food, beverages, pharma, and paper.” One of the known water sources treated by the company is the Agra River near the Taj Mahal.

“A few months ago, President Reuven Rivlin visited India,” Frenkel says. “He came to our facility there, which helps provide clean water for two million people. What we’re doing in India and other countries dramatically improves people’s lives.”
In addition to managing AqWise, Frenkel is also the chairman of the Israel Export & International Cooperation Institute water section. He says that the water sector in Israel has been growing by double-digit percentages for the past decade, reflected in an impressive rise in exports from $800 million annually a decade ago to $2 billion a year at present. The technology of AqWise and other companies is arousing great interest among developing countries. Frenkel explains that one of the water industry’s challenges is strengthening the ecosystem. He says that nearly 100 startups are operating in Israel, in addition to relatively mature companies, but complains that there are too few growth companies that already have a product and sales, but have not yet achieved a breakthrough.

AqWise’s success depends to a large extent on global regulation. China and India are adopting, each of them separately, standards designed to prevent pollution. Regulatory discourse is not confined to developing countries; clean technologies are also relevant in the US and Europe. AqWise provides services to large corporations, such as Coca Cola, Unilever, Teva Pharmaceutical Industries Ltd. (NYSE: TEVA; TASE: TEVA), Perrigo Company (NYSE:PRGO; TASE:PRGO), and Nestle. Frenkel says that in many cases, corporations are adopting stringent standards, even in countries where the government requirements are lower. He adds that AqWise is also providing services to large municipal authorities in Madrid and Rome. According to Frenkel, the technology makes it possible to upgrade old facilities at relatively low cost.

“Globes”: You have a turnover in the tens of millions of dollars and are making a profit. Isn’t it time to start thinking about an exit or an IPO?

Frenkel: “We’re looking at all of the possibilities. It’s something that can happen, but not necessarily in the immediate future. If we hold an IPO, it won’t necessarily be in Israel.”

Do you share the feeling that clean-tech is the step-son of high tech?

“They began using the term ‘clean-tech’ in 2005-2006, when there was a peak of a few years in which the sector got a lot of investments and attention. There’ no doubt that cyber is sexier now, but water is still one of the world’s biggest markets: $600 billion a year.”

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