
Launch HN: NextDrop Technologies (YC S17) – Water Marketplace for Urban India - anusridharan
Hi HN,<p>I&#x27;m Anu, the Co-Founder and CEO of NextDrop Technologies (<a href="https:&#x2F;&#x2F;nextdrop.co" rel="nofollow">https:&#x2F;&#x2F;nextdrop.co</a>). We are a water marketplace for urban India- we connect water buyers with suppliers.<p>There are 400M people living in Indian cities today, but only 200M of them get reliable access to the public utility water.  The other half have to buy private water, often from water trucks!<p>Water buyers have a problem because surprisingly, people are paying more for their water than for electricity. My friend who lives on the outskirts of Bangalore, India (a major urban city) paid $50 for water and $40 for electricity last month.  The price of water has tripled in the last decade and is on track to continue. What’s worse is that since water is getting so expensive and scarce, water trucks are starting to source water from dodgy sources like highly polluted surface water and really deep wells.<p>Water suppliers have a problem because they service demand as it comes in.  They lose money due to bad scheduling and inefficient truck utilization.  Many people think that all water suppliers are part of a  “water mafia”, but the interesting trend we are noticing is that there are a lot of micro entrepreneurs popping up in the last few years who have their own water source, buy a truck, and start selling water.<p>Our marketplace fixes the problems for both water buyers and suppliers.  By installing our smart metering devices into consumers water storage tanks and transmitting data to our platform, we can predict when someone is running low on water and schedule a delivery.  We track the the water from the filling source to the delivery using GPS, giving users confidence they received clean water.   Qualified water suppliers make more money and buyers get clean water and transparency into pricing.<p>We just launched this summer and are piloting with 3 apartment complexes with 11,000 people. We have devices installed and transmitting data to our platform.  By next month, we should have enough water data to start automating water deliveries.<p>We&#x27;ll be around to answer questions and discuss water management and are excited to hear your feedback and experience in this area!
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coolswan
Forgive my ignorance but is there actually enough water in and around India to
make up for the shortage, but right now it's just not distributed efficiently?
Or after solving for all these inefficiencies, there'd still be a shortage? If
so, what are other sources they can leverage down the road?

~~~
anusridharan
That's a really good question with a not so straightforward answer. I'll start
with some stats. Public water utilities lose 50% of it's water due to
leakages. During monsoons, India gets enough rain to fulfill it's drinking
water needs (but as you can imagine, it's hard to store that water for the
year). As energy gets cheaper and cheaper, technologies like desalination will
get more affordable, and pumping water will be very cheap. (Just as a
reference, California currently spends 3% of it's energy on pumping water!)

Overall, with the confluence of technological interventions, we think that
India (and the world for that matter) has enough water- and can harness it.
But right now, we see a lack of water data in the ecosystem, and we're using
IoT devices to start tracking water in different forms. We believe that
humanity can solve it's own problems, but it needs the data to do it. That's
what we're starting to do in the private water sector, first by tracking
demand, and withdrawals, and next with using data to model aquifer health.
That's how we want to contribute to making sure all 9B people on this planet
get clean water- make sure humanity the data to make the right decisions.

~~~
samblr
>> Public water loses 50% of its water due to leakages

Can you please quote source for this.

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MarkMc
> We track the the water from the filling source to the delivery using GPS,
> giving users confidence they received clean water

I wonder how easy it would be for water suppliers to cheat such a system.
Perhaps the supplier will send the GPS device to the clean water source on a
motorcycle, and send the water truck to the dirty source. I'd recommend you
occasionally sample the consumers water tank and test the quality of the
water.

~~~
samblr
>> Qualified water suppliers make more money.

This single line shows what NextDrop's malicious intents are underneath snake-
oil salesmanship.

Who decides about a qualified water supplier and how ? Im sorry to say this -
how is this not snake oil salesmanship ? Water quality is a gargantuan
regulatory challenge that no civil body takes easily. The sheer scale of this
even in a small city/country is a lot. And NextDrop lay (fake) claims to solve
this for India delivering water trucks! Right ok.

From other comment-threads it can be gathered that commercial water supply is
already an illegitimate business. So NextDrop wants to make most of this
illegal business by helping clients with more gadgets. And they are doing in
grand style of selling vision of "Securing India's Future One Drop At A Time"
in their landing page. Wow, unbelievable. That reads like a hollywood line -
"Securing earth's future one ______ at a time".

The disappointment gets worse when I learn that OP appears to be a bright kid
having studied in an institute of repute. [https://www.linkedin.com/in/anu-
sridharan-b24a016/?ppe=1](https://www.linkedin.com/in/anu-
sridharan-b24a016/?ppe=1).

Sometimes solution to even pressing needs as this do not solve the problem -
instead they further widen the wounds. NextDrop and likes will stand testimony
to these facts.

I see somebody pointing out this to be Uber for Water - uber actually stands
for fighting regulatory. NextDrop and likes will stand for aggregating-and-
being-a-proxy for web of illegitmate business! Huge difference.

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puranjay
Congrats for spotting this massive opportunity! This looks very promising. The
sector is extremely disorganized and lack of competition is jacking up prices.

My question is: you're essentially serving a market whose need is not being
met by the government.

Slowly but surely, the government will step in and solve the problem.

The problem is compounded by the fact that your target market - urban
populations with smartphone access - will likely be served by governments
before rural populations.

Happened in Jaipur. All my friends used to routinely get water tankers every
week. Now they get municipal water.

Eventually, it will happen everywhere else too.

What then?

~~~
anusridharan
Hey- that's a great point, and I'm glad you brought it up. Our previous
company actually sold water data to governments so we've been working quite
closely with city municipal corporations. The problem is that urbanization is
happening much faster than cities can keep up. Stats put it at 200M people
added to cities in the next 10 years. What city municipalities are doing is
actually hiring private companies to service the extra demand. It's still part
of "the government" but India is trending towards more public-private
partnerships. We actually WANT the government to start to sell water on this
marketplace. We would have already laid down the IoT data collection
infrastructure to help them keep their loss rates low and ensure the right
people get good quality water (which is one of the biggest problems they have
today). We see this as the next eventual step for governments not just in
India, but in many emerging markets.

~~~
codegladiator
> We actually WANT the government to start to sell water on this marketplace.

I hope this never happens.

Mafia of water tanker already operator exists, and you want to capitalize on
that. Great strategy for biz but bad for end users.

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manjuds1
Hi, good work, your solving very critical problem which we face in our
Bangalore.

But my doubt, is commercial water supply legal?

[http://www.thehindu.com/news/cities/bangalore/where-do-
tanke...](http://www.thehindu.com/news/cities/bangalore/where-do-tankers-
source-water-from/article18311097.ece)

as per this article, an RTI query says, no commercial water supply license
issued by BWSSB

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skdjksjdksjdk
1) I remember reading about you some years ago. I think you were working on
telling people/govt(dont remember which one it is), when water is being
released. SMS based I believe. How did that work go? Was it
profitable/scalable? 2) Can you comments on how profitable it is to sell data
to Indian government organizations? Is it VC-level business or Lifestyle type
of business 3) I believe you have to be in Bay area for 3 months as part of
YC. For a business like yours(which requires on the ground presence), how does
being in Bay area help? 4) Most important, how do you expect to take on
politicians who control water mafia?

~~~
anusridharan
Yes- the original company NextDrop has been around since 2011, but we shut
that down about a year ago and started this new version of NextDrop recently.

At a high level, you're correct. For the past 6 years we were essentially
selling water data to consumers, governments, and global brands. It was
actually a profitable business but we decided to shut it down, not because we
didn't have enough demand for water data, but because we were crowdsourcing
water data and that was not very scalable or reliable. Back in 2011 IoT
devices were way too expensive. When my co-founder and I noticed that devices
were pretty cheap, we decided to start a company around water data again.

YC was great about us spending time in India- we split our time between India
and the US because all our users were in India and they knew that. Honestly,
to go after a big opportunity, sometimes it helps to be on the ground, and
then step away and get advice/feedback from people who will listen to what
you're saying and help you see the best way forward. That was how we used the
time in the Bay Area, and found it very valuable. It was also useful for us
because we were still in the launching stages. Had we been further along in
the business, it may have been much harder to do what we did.

The water mafia question is definitely a super important. The only way we can
see taking on the mafia is to add more water supply on to the market. The only
way we can do that is to enable micro entrepreneurs to sell water. As you
probably know, about 50% of urban Indians have their own borewell, but less
than 1% sell water. Phase I is to aggregate water demand using our IoT
devices, and Phase II is to enable hyperlocal selling of water.

~~~
skdjksjdksjdk
Thanks for all the great answers. I wish you the best.

>>The water mafia question is definitely a super important. The only way we
can see taking on the mafia is to add more water supply on to the market. The
only way we can do that is to enable micro entrepreneurs to sell water. As you
probably know, about 50% of urban Indians have their own borewell, but less
than 1% sell water. Phase I is to aggregate water demand using our IoT
devices, and Phase II is to enable hyperlocal selling of water.

Thats an innovative idea with potentially many social ramifications(positive
and negative). I will be watching it closely!

~~~
anusridharan
Most definitely- we will also be diligent, and we'd love feedback and thoughts
as we progress!

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pfarnsworth
This sounds interesting, because as someone from the West, I have no concept
of what it means to "buy" water. We completely take for granted the fact that
every single house has access to clean water. One thing, in SF I am also
paying more for water than electricity, it comes out to about $60/month for
water and $45/month for electricity.

How do you protect customers from sellers who have poor quality or poisonous
water who try to game your system? Do you do water testing as well?

~~~
anusridharan
That's a great question. Right now we manually take water samples and get it
tested in a lab. Over time, as IoT devices get cheaper, we believe the water
quality testing will be done at the source, online, and in real time. This
makes it much harder to game the system.

Additionally, we track the GPS location of the truck with the water to make
sure clean water is filled up at the source and the same water is delivered to
the consumers.

~~~
pfarnsworth
What's to stop another truck with bad and cheaper water from coming and
filling up the truck that's being tracked? I imagine if the prices are higher,
there's a lot of incentive to commit fraud, especially on something as short-
lived as a water supply.

~~~
ada1981
Perhaps randomized sampling / testing. You'd want to be a highly rated
supplier so as not to compromise future sales.

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arekkas
It's almost unimaginable to not have access to clean water sources if you're
living in Europe, and especially in Germany where tap water has the upmost
quality. So I believe that any solution for this is awesome.

One problem however is that big companies like Nestle or Coca Cola are putting
a ton of money in marketing bottled (usually plastic) water which is a
gigantic, unecological, unnecessary, and expensive money machine. While I have
not been to India myself, I have seen documentations on bottled water in
countries like yours. Companies advertise it as the "clean" (despite not so
great quality) water, the one you buy when you have money.

Do you have any plans, ambitions, or visions to counter this trend - in
particular relying on plastic bottles to ship water? I think you have the
opportunity, and maybe soon the market share.

~~~
anusridharan
That's a really great point, and bottled water is actually the fastest growing
segment of private water in India (growing 30% year over year). My co founder
and I have been living in India for the past 6 years and we both own personal
home water filters and carry around a reusable water bottle. We are fans of
companies like Unilever who are trying to produce low cost water filters for
emerging markets. We think that if we can get the cleanest, cheapest water to
people, and by eventually partnering with water filter companies, we can
tackle the bottled water problem.

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sirius87
Interesting. I like the idea of smart metering devices. A lot of people,
especially in Mumbai, don't track consumption at all. Do you see changing the
mindset of people w.r.t. conservation of water particularly challenging? Some
areas in Mumbai receive stable, 24x7 water supply while others barely receive
a couple of buckets twice a day.

Quite a few areas and apartment complexes utilize a wide range of hacks to
ensure _their_ area receives adequate water supply. Distribution of water from
the authorities is anything but uniform because of devices such powerful water
pumps and larger than sanctioned storage tanks. Much of this, although
illegal, is with the blessings of local political leaders.

Any insights on how these issues could be addressed? Much appreciated.

~~~
anusridharan
Yes- we actually started out going down the road of conservation via smart
metering devices. We quickly realized that we would be facing an uphill battle
if we kept trying to start there.

Also, as a point of clarification, no city in India receives 24x7 water
(except Jamshedpur), although many cities have pilot projects (Nagpur is the
closest to Mumbai). The Bombay Municipal Corporation (BMC) is probably the
furthest ahead as far as public water utilities go, and many people think they
have 24x7 water, but they just have a very reliable, but intermittent, source
of water. The BMC has done a very good job of trying to reduce inconvenience
to residents.

We actually think that, ironically, as water gets more expensive for the
higher income groups, they will then start turning to water conservation
mechanisms. That's the pull we are seeing in Bangalore, and what we think will
be the pull in the future. Lower income communities already do a pretty good
job of conserving water since they tend to pay a higher price. It's amazing
what market forces do for water conservation.

We are also encouraging communities to introduce slab billing and try to do
individual apartment metering. By raising water prices for the highest users,
people are becoming more price sensitive and trying to use less.

~~~
sirius87
> many people think they have 24x7 water, but they just have a very reliable,
> but intermittent, source of water

This is true. A lot of complexes have larger than reasonable storage tanks. If
a new complex pops up next to your apartment building, you immediately see an
effect in your water supply levels. It'll be interesting get a heatmap of the
disproportionate distribution, but unless some authority gets involved, this
may not happen.

> encouraging communities to introduce slab billing and try to do individual
> apartment metering

Agreed. Price affects behavior.

Thanks and good luck!

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Abishek_Muthian
Hey Anu & team, congratulations. You're addressing a definite need-gap.

Query:

How do you ensure safety. Do you make your suppliers follow certain safety
protocols designed and tested by NextDrop, if so would you be making that
public?

Boiled water - We & travellers to our country are constantly advised by
experts to drink only boiled water; even when if it's 'purified' by the
supplier to remove contaminatents, sub-par packaging results in dangerous
contamination. Assuming you have customised dispenser to record data, how to
you plan on addressing this need.

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whocanfly
Congratulations for the launch, team!

Living in Bangalore, this is one of the biggest challenges I see. We notice
the dying lakes and water supply shortages. It would not be wrong to say that
a mafia of water tanker operator exists.

A friend from Jaipur mentioned how their city handled this situation better &
how Bangalore seems to be struggling despite good rainfall.

The other night we saw a man refilling water cans from an ordinary hose and
prayed for the recipients' health.

Are you launching a service or product for domestic users? Shout if you need
beta testers.

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mindhash
You could create a new system by delivering water to each home in a complex
through smart metering .. kind of own the inventory... I live in a complex and
have no idea why we pay so much for water..my consumption is quite low.. micro
managing with this sort of system will help reduce consumption.. I was told a
society spends on 60 trucks of water every day..that's huge for a society..

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navalsaini
Hello Anu.

Nice to see you here.

My question is - what do companies serving a market far flung from US (as
India), get by going to YC. It is indeed a great achievement; but how does it
help the company. I can see a direct advantage in being able to hire talent or
approach a global pool of investors.

The other I can assume is that it would help going global and aiming to serve
other markets. Is that the correct assumption too?

Congrats. Wishing luck.

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pranavpiyush
I remember this pain point vividly from 20 years ago, growing up in Delhi.
This is a massive long term problem and a great opportunity. Good luck!

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vthallam
Great idea, Anu. Congratulations on the launch.

How much does the devices cost? I assume since this is mostly used by
apartment complexes, it should not be a problem to convince them to pay one
time device cost. But independent house owners would not be willing to pay the
device cost, are you also planning for a 'Uber for Water Tankers' style
ordering in this scenario?

~~~
anusridharan
That's a good question. Actually, we've spent time figuring out how to drop
the cost of the device to sub $30, at scale.

For frequent users, we would give the device away for free. For people that
are on a public water connection and only use tankers once in a while to
supplement their water usage, it would probably be like you mentioned- order
tankers on demand, when you need it.

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Squareplums
We at Square Plums (www.squareplums.com) manage hundreds of co-living homes in
Bangalore and we are looking for a reliable solution to this problem. Will be
happy to do a trial at one of our properties. Contact us at
founders@squareplums.com if you wish to discuss.

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amjd
Pleasantly surprised to see this launch. I interned at NextDrop a couple of
years ago. Anu and the team are a passionate bunch trying to solve one of the
biggest problems in a developing country like India. My best wishes to the
team. :)

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scdoshi
Looks like a really good idea.

How do you plan on scaling without becoming part of the water mafia (or at
least enabling them)?

After all, there are only so many independent suppliers with their own water
source.

Would love to hear you thoughts on this.

~~~
anusridharan
That's a really good point. We've had to think long and hard about this one
too. There's one interesting stat that is less known. Aboout 80% of India runs
on groundwater, and in cities, we have estimated that about 50% of the people
have their own private water source. BUT- less than 1% sell that water. Now
imagine we've used devices to aggregate all demand (phase I). Phase II would
be to introduce new supply into the market. Enabling anyone with a borewell to
sell water to anyone else. The biggest cost of private water right now is
diesel transportation costs. When we implement Phase II, we want to enable
more micro entrepreneurs to sell water hyper locally, driving down water
costs. We'll have to do this carefully, but that's the only way we see not
becoming the mafia and doing our part to make clean water more and more
accessible to people.

~~~
ceejayoz
> Enabling anyone with a borewell to sell water to anyone else.

What happens when the neighborhood loses its water sources due to overuse?

~~~
anusridharan
Yup, that's something we have to monitor carefully. That's why the backbone to
our business is actually IoT devices that transmit data to monitor different
aspects of water. We're starting with data around water withdrawals, and
moving to using devices to monitor groundwater levels. We think we can collect
enough data from our devices to model groundwater aquifer health, something
that very few people are doing due to lack of data and overall costs. Once we
can monitor aquifer health, we can make sure that we are not overdrawing, and
recharging effectively.

~~~
scdoshi
Monitoring aquifer health seems like a good approach to start with. Great to
see you have thought about the issues.

Water is an ethically challenging area to start a business in, but the status
quo in India is pretty bad, so I hope you do well!

~~~
anusridharan
Thank you so much- we really appreciate it!

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gt5050
Congratulations on the launch! A lot of households also use water cans, and
very often you cannot control the quality, are you planning to address this as
well ?

~~~
anusridharan
Thank you! And yes, we've definitely thought about this market segment as
well. We are actually of the opinion that water can delivery will eventually
die out. If you do the math, it's actually more cost effective to buy a water
filter for drinking water. Water filtration technology is getting cheaper,
more people are buying in home filters, and we're trying to get them the
cleanest water possible to their homes.

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kk58
Great stuff. Just curious do you have any background in environmental science?

~~~
anusridharan
I have a background in environmental engineering actually- I did my bachelors
and masters in Civil Engineering from UC Berkeley. In undergrad I focused on
environmental engineering, and for my masters I focused on sensor technology
and how it's changing our built world. It's been a wild ride.

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iamalchemist
Looks interesting.. When will you guys come to Chennai?

~~~
anusridharan
Oh man, we're hoping to get there as soon as possible!

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vishald
Superb idea. India needs this!

~~~
anusridharan
Thank you! My co-founder and I quit our jobs and moved to India 6 years ago,
and we've been working in the urban Indian water space since then. We really
felt that something needed to be done and we've been on a journey to figure
out exactly how we can change the status quo. We appreciate all your support-
it means so much!

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nav
Congrats Anu and team!

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indiafoodie
Uber for Water!

~~~
anusridharan
haha kind of, with a slight automation twist. We use IoT devices so we
automatically detect when your water is low and order it for you :) We've
realized that for people who have to order water often, it's kind of a pain to
do it manually every time. That's the IoT version of it.

