The waste and water management sector witnessed a 36.3% rise in investment dollars in 2016, hitting an unprecedented peak of $3B over 196 rounds of financing. In Early stage funding activity saw a 116% rise in total dollars, from $230M in 2015 to $498M in 2016, while deal counts rose by 13.5%, to 84 deals. While average ticket sizes rose across the board, Series B stage rounds saw the highest YoY inflation (222%) in ticket size.
There were a number of big ticket funding rounds in 2016. Florida-based Advanced Disposal bagged the largest round (Series B) of $280M from CPP Investment Board in August. Other large financings include H2O Midstream’s PE round ($100M) led by EIV Capital and Goodnight Midstream’s $80M PE round led by Tailwater Capital. Range International (ASX: RAN), an Indonesian company that converts waste plastic into pallets went public in July of 2016, the sole IPO of 2016. There were 16 acquisitions in 2016, a majority of which were companies dealing with waste collection, management and recycling.
The waste management business model saw a considerable uptick in funding dollars, bagging $2.2B over 95 rounds in 2016, compared to 2015’s $871M over 85 rounds. Within this, waste treatment businesses have elicited the highest investor interest, bagging $3.4B overall. Water and wastewater management businesses saw a slow-down in funding activity, dipping from 2015’s $1.3B to $784M in 2016. Given the globe’s water crisis, conceivably, investors are interested in companies dealing with the treatment of wastewater.
Climate KIC and KPCB are the most active investors in the water and waste management sector. Climate KIC has made six seed stage entries, while KPCB had has made five bets each, at the Series A, Series B, and later stages.
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