We had Dan Early on the show and he is indeed AMAZING! As an example, his proprietary Plug 'n Play systems are completely installed and online in as little as 8 hours from delivery where conventional systems take weeks or even months! Adoption of Dan's visionary solution to America's $Billions water infrastructure failure is snowballing… But can his EveraMOD™ products provide the vitally needed safety net for its Operations and Maintenance? Find out in the replay!
I'm Riggs Eckelberry co-founder, chairman, CEO of OriginClear. The government needs to continue to provide a lot of abundant clean water, but what happens to it after it's used when it's dirty? Do you know that 80% of all sewage is never treated, it's just dumped? That leads to water scarcity, but it also leads to a lot of disease and pollution, the ocean turning into something horrible.
At the same time, the cities and counties are not getting the funding they need to really treat the water and so they can't keep up. The solution is let the people who use the water clean the water. Water on Demand™ is investment in actual capital assets that earn income. Sign up to hear my weekly briefing every Thursday night. 5 p.m. Pacific, 8 p.m. eastern. Just put Oc.gold/ceo in your browser. Register for the briefing and I look forward to hearing more from you.
Riggs: And welcome aboard for another exciting briefing. You're going to love this one. Oh, Lord. The amazing Dan Early joined me a couple of days ago and he was really, really detailed, lots of useful information. So we'll get right onto it. And Robert Baxter says, "Hello, guys." Right on. Right on.
It is July the 14th, Bastille Day in France and briefing number 169, A new beneficial income asset water. So without further ado, we're going to, of course, show you something that's in the news, actually.
We were in a USA Today special edition that got put together for the US Army Corps of Engineers and. So this is kind of the front.
I'm actually going to show you the real thing in a second. But this is what it looks like. And then you have all these thumbnails.
And then we zoom right in to a section about levees and sure enough, where we have the last word about levees.
National Levee Safety Program is a great example of a coordinated effort to improve the conditions of one sector of the one industry, and I hope to see more like it. So I approve.
Let me show you what it looks like in actuality. Here is the visual thing. And if we look here, here's all the pages, and so we come right in on page 16. Here it is. And sure enough. There's the article right there. So that's another nice little hit that we got.
Another thing I wanted to show you was a new media page. So mixing up all the media, it felt it was like, you know, you don't know ahead of time that you've got to go look in radio or whatever. So this all mixed up and water online and Forbes and all kinds of good stuff here that we have coverage. And this is all, of course, very, very important. All right. So that's the media page. Now we're going to have the CEO interview with Daniel M Early, professional engineer.
Interview with Dan Early
Riggs: Dan Early, the man himself. How are you?
Dan: I'm doing well, Riggs. Doing very well. Good to see you.
Riggs: Likewise. Well, there's been lots of interesting developments. I think we can both agree it's been an interesting and long road, but we're starting to see some daylight and some excitement. And what I thought we'd do today is kind of, first of all, go over some of the stats to show where the business is basically inflected from early days to where it started taking off, and then discuss the company's business model, perhaps the whole Water on Demand initiative, how that might play out in terms of getting your technology out there to the install base.
So without further ado, I'm going to go ahead and share screen here. And this is anonymized version of our company forecast, our live forecast here. And what we're looking at is 2022 here, where it really shows that in Q1 you were almost five times 2021's Q1 which really says that this was really, in my opinion, early this year, you hit an inflection point where in literally March you just scored a very nice 20,000 gallon per day unit. Now, remind us what EveraTREAT™ is.
Direct Burial System
Dan: The EveraTREAT is our packaged wastewater treatment system that utilizes the structural plastic tankage system as the delivery model. This is direct burial, direct burial application. In this instance here, line 17, the 28,000 gallons per day. EveraTREAT system is a two tank system for a school project that we're working on in Florida.
Riggs: What do you mean by direct burial?
Dan: It's a full, direct burial means that the tank is, it's not an above ground unit. This one is designed for partial or complete burial. And basically, you put it in the ground. It's like out of sight, out of mind. It provides additional security. It helps protect from environmental conditions, heat, winter, cold, freezing and those types of things.
Pump and Lift Stations
Riggs: Very interesting. So you so, you're able to jump up there. And now what we see also in this lineup is on the far right column end is the pump station business, which it was up 72% over 2021. And if we go into 2021, actually, we see I'm just going to look at the full year here. Your whole 2021 was also four times over 2020. So you had two big jumps, 2020 to 2021 and then 2021 to first quarter of 2022. And we saw good steady growth in pump stations.
What I see here is that pump stations just had a nice even growth and that's very typical of the business, which is more municipal in nature, more infrastructure related, as opposed to being a fully decentralized commercial business type application. Am I right with that type of characterization?
Dan: You are. You're correct with that. The EveraMOD™ Pump Station product line, it it is an infrastructure solution. It is derivative of the heavy plastic manufacturing model that we are deploying and continue to evolve and grow in support of our decentralized wastewater treatment product lines. It's just a, it's just an, what I like about the EveraMOD is it's an ancillary beneficial product that contributes to the water infrastructure world. So that's a really, really nice little product line we have.
Riggs: Remind us what a pump station is versus a lift station.
Dan: Well, the pump station and the lift station get used interchangeably. Those terms in this instance, right here we are pumping wastewater in, in wastewater collection and conveyance systems. When you discharge wastewater from a facility, either flows by gravity to a low point where it's treated or you achieve your treatment and final disposal. Or if you have to pump up to a higher elevation, you have to use a pump station or a lift station. So that is what a pump station or lift station is. It's designed to collect and pump the wastewater and to convey it downstream to its final destination.
Adoption is Snowballing
Riggs: But it sounds pretty prosaic, and I would say that what is causing people to begin to adopt Modular Water Systems™ EveraMOD product line versus existing stuff?
Dan: The message that we have been promoting and preaching into the industry about the durability and the sustainability as it relates to the EveraMOD pump station product line. And for the wastewater treatment, the EveraTREAT, the EveraSKID™ product lines, the sister, the sister products, the durability and sustainability of the structural plastics vessels and those systems is really catching on very, very quickly.
The specifying engineers and the consulting engineers that specify these types of infrastructure solutions, they design them into their permitted construction documents. They are looking for those solutions. And what we are finding is now that we are established and have built a reputation, have established and have installation base, and we have a reputation and referrals. The regions where we are working, we are starting to see rapid adoption of the pump station product line.
Unique to the Industry
In Pennsylvania in particular, now in Georgia, also in Texas. Those three regions right there, we were heavily focused on early stage promotion and marketing. And I think it's very indicative and is indicative of the trend that where, the major the major trend we're seeing in infrastructure world, where end users, public utilities want these 100 year lifecycle solutions for the structures. And that's what the EveraMOD is. It's a turnkey single point of delivery infrastructure solution that happens to have a 100 year structural service life.
Riggs: It's a simple product, right? I mean, it's a tube with a pump at the bottom, basically.
Dan: It really is not overly complex. It's just that our methodology, our design methodology and our manufacturing approach and our single point of delivery model is very unique to this industry. It, we are doing things in the industry that are different from the conventional design and procure model around precast concrete or cast in place concrete, these very clunky, archaic old delivery models.
It's not unlike comparison to the modern electric car or some of the things that you're seeing, some of the evolution you're seeing in the manufacturing world. We're just doing it in plain-Jane, just regular run of the mill wastewater infrastructure systems, and it's catching on. I'm very pleased with the progress we're making.
State of Existing Infrastructure
Riggs: What would you say, from what you know is the condition of the pump station, what kind of condition is it all in?
Dan: That's a fantastic question that you've asked Riggs. The existing infrastructure, installation based around pump stations is in deplorable. It's, they're huge. They're everywhere. These things, people don't see them because they're out of sight, out of mind. They never think about it. They flush the toilet. They just don't know where the waste water goes. In every locality there are pump stations and in some regions there are tens of thousands of these pump stations.
And these mostly, I would say the average life, the average age, probably in the 50 to 50 year life cycle. A lot of these have been installed in the last 30 to 50 years and they have far exceeded their usable service life and are now a a contingent liability, a future liability. It's a maintenance risk involved with them. They have to either replace with like or they have to upgrade and install a newer solution, which is what the EveraMOD represents.
It represents a solution that overcomes this durability challenge that these end users and vendors and operators struggle with on a day to day basis. So I would say the addressable market in North America is in the billions of dollars of value just in the wastewater, just in a wastewater lift station. It is in the billions. It is a huge, unrecognized and unrealized burden.
For the most part. The end users, the new utility owners and operators, they know what the challenge is. They know because they're fighting that fight every day of the week. And so we, the EveraMOD system offers a solution to help deal with these big, these very expensive O&M budgets, the trying to forecast what your budgets are going to be ten years, 20 years, 50 years from now, the EveraMOD really provides a safety net and helps those end users.
Riggs: O&M budgets, operation and maintenance budgets. So. So basically it's a different audience from our regular wastewater treatment business, which is more decentralized. Am I right?
Dan: It is. It is a different business model. It's different end user, different application. It is both municipal, which is the public sector, the public utilities, the public wastewater utilities. But on a parallel path, there are these commercial applications. And I can speak, I can speak today about our first national account that we've just recently secured, big, major commercial account.
They are investing in and want green technology, durable, sustainable infrastructure solutions. After understanding the value proposition that is the EveraMOD product, that infrastructure solution that we've created, they have adopted that as their preferred and their specified solution. So that product line, just that one customer right there I think will contribute at least another two and one half million dollars in top line revenue just to the pump station product line by the end of this year. It will probably go to 5 million next year, just with that one customer.
Riggs: We're talking about sales.
Dan: Basically in sales. Yes, sir.
Riggs: Wow. Well, that is really exciting. And I think that's why we're looking at basically separating EveraMOD from the Modular Water Systems fold to give it its place in the sun, give it its own team, its own network of referrals, because it's as you say, it's more of an infrastructure play versus a point treatment play, shall we say?
Dan: Correct. It is very much so.
Riggs: Very good. Well, let's go back and look at some of these other observations we have here. So taking a look again at 2022, we see that this, of course, we announced recently that first half of 2022 was a big jump versus 2021. And you, in fact, were a big piece of that you were two and a half times as opposed to overall, it was two times, you were two and a half times.
So you've really you know, I think what's what's fair to say is that, we've had Progressive Water Treatment and it's had a certain run rate and you basically doubled it up. And at the same time, both of you are growing. So not only is PWT being sort of cloned revenue wise with you guys, but both of you are also increasing. So that we're seeing, for example, first half, 2022, you closed 2.5 million.
Now, by the way, I want to make make it clear, these are purchase orders. They do not reflect cash flow and they do not reflect recognized revenue. So they are an indicator of future business, but nonetheless, they are closed contracts. And you've gotten a big jump for the year so far. While at the far right here, we see that the pump stations are getting a nice, steady growth in wastewater treatment and in pump stations. So that's super exciting. Obviously, the biggest challenge right now is we got to staff up for it, right?
Scaling the Business
Dan: Yes. Yeah, we do. Big time. Big time Riggs. I was, I've been in a series of executive level meetings with Tom Marchesllo, he's our COO and with Prasad Tare, he's our CFO. And we are laying the groundwork. We're actually close to inking a deal to bring a new a new senior engineer on board. We are looking for we need bring on production managers and product managers, additional engineering staff. All of that is on the front end, on the top end and front end of the business model.
And then on the back side of it, we are trying to balance that out by bringing additional manufacturing resources on board, both in our facility in McKinney with our sister company, with PWT, but also with third party independent preferred fabrication partners that we work with on a day to day basis.
I'm very pleased with the way those relationships continue to evolve. Our outside third party vendors are making sizable upgrades to their manufacturing capability, both in tools, machines, manufacturing, labor and those types of things. All of this is working towards the overarching goal, the long term vision we have for Modular Water Systems and the the scaling of the business lines around the EveraMOD system, the EveraTREAT, the EveraSKID.
Those, all three product lines are seeing very rapid, rapid growth, very rapid acceptance and adoption in all of the major regions where we're currently focused and we are only focused in just a handful of specific regions at this point in time, as our independent sales network grows, this demand is going to continue to is going to continue to grow as well.
What's Driving the Expansion
Riggs: So obviously, there's good word of mouth about it. But what from a marketing point of view is driving this expansion?
Dan: The drive behind this has been our focused and deliberate promotion and marketing campaign. We started in 2019 with the EveraMOD product line. We were very, we had we developed the product line, we promoted it to specific regions, we promoted to the consulting and the specified engineering world where that is, they are at the tip of the spear working with their customers and clientele. The product is geared towards them. It makes their lives easier and with use comes familiarity. And the engineering world really likes the ease of which they can take our product and implement it as a solution for their customers.
Now what we are seeing, a similar series of events and experiences with respect to the EveraSKID plug and play wastewater treatment system and the EveraTREAT direct burial package from wastewater system that we have. That is what's driving this. It's a very deliberate, very focused process. You know who your end users are, who your stake who your stakeholders are, and you have to promote to all of those. And you solve a problem for all of these stakeholders that are a part of this process, as you do, that this thing scales and grows very rapidly.
Riggs: So you get an expansion within these networks of sales reps and consulting engineers. And of course, I know you're doing these wonderful webinars where you're getting you're doing a lot of indoctrination. You're being Johnny Appleseed when it comes to your design philosophy and your proprietary tech and so forth, right?
Dan: That's correct. All of those things we use all those tactics and strategies to get the message out to the infrastructure world.
Riggs: Now, again, for our audience retreat is the underground basically buried like that Pennsylvania dealership that we did? Right.
Buried vs Above Ground
Riggs: Buried the unit there. A skid being a skid. In other words, is a containerized solution that just drops in place. Where would you use the skid versus the treat?
Dan: The EveraSKID system, that is our plug and play. It's an above ground installation. And this is the one that, this one is really starting to find a lot of success. Now, this one is typically used where the end user is looking for the fastest installation conditions as quickly as possible. It's the fastest commissioning because it basically the systems come so complete that when you take the container unit and you and crane it off and set it on the concrete pad, it's a pipe connection in it's a pipe connection out and it's a power connection. If everything staged properly within 8 hours, most of our units are readied for immediate commissioning and for into, place in operation. So that's the version that's above ground.
Only the EveraTREAT is for below ground, like if you've got concerns about aesthetics, weather, size, those types of things. So there are different applications. And what I really like about it is that we can offer both.
Riggs: Well, this is great. So three major products, two of them wastewater treatment, one of them pump stations. That's really, really interesting. I wanted to discuss sort of zoom out a little bit and talk about the evolution of the company. And I'm going to pull up our current strategic presentation and how our role is evolving into what we call an innovation hub. And you're seeing this happen in real time. And you can tell that that we we are a changing organization because, of course, we're trying to make change happen in the water industry, which is not easy.
But our previous historical model was to constantly build value. Of course we started analogy transition to water tech acquired by 2018. We launched Modular Water with you June, last week of June 2018 I recall. There was an abortive crypto down there WaterChain, which is now being planned as this $H2O, but those are soft targets and then adding Water on Demand, which we'll discuss a bit and in the Water4Us program. And finally, a EveraMOD pump station. So these are all great. The problem with it is we it was a bulky model and inevitably one or the other division was going to be red headed, red haired, red headed stepchild and not get the attention deserved. Right. And it was also a constant burn.
And so we moved about a month ago. We moved to a different point of view where we successfully launched Water on Demand with its Water4Us program, which I'll discuss in a second. And we said, "Well, wait a minute, let's make that what we do." So in this model, Water on Demand being, of course, the water as a service pre funded systems that enable end users to just sign a piece of paper and they get their water taken care of on a per gallon basis.
Water4Us is focused on human communities, which, as you know, we've had a lot of action with with, you know, travel, freeway travel stops, hotels, RV campgrounds, trailer parks and also housing developments, which are very interesting. And that's all, we put that in a separate category, because it's a huge mega-trend of people moving to areas that are much more spread out, more rural, less sewage service and thus needing a freestanding water treatment capability along with maybe even energy independence and so forth. Very exciting trend.
So that is what's happening here. And in this model, OriginClear offers the management support so that Water on Demand INC with its Water4Us program is an independent company, but it doesn't have to replicate HR, legal, finance, etc. that all is handled by OriginClear. And as we move forward in time, we have the prospect next year of doing something. $H2O is the asset wrapper using blockchain that we're looking at and exciting is that in the last quarter of 2023 we might be taking EveraMOD, it's actually might even be earlier than that but it's going to be split out. No, actually, no. It's going to be early 2023. We're going to make it its own little business unit preparatory to we're thinking of making that its own little launch.
What's cool about this is, as I noted in the top right here, is that crowdfunding has become so packaged and productized that you can deploy a marketing campaign and fund a company with prospectively it being a public company. And the key players in each one of these companies get a tremendous equity share and thus they get more directly rewarded as opposed to sort of the big board kind of concept where everybody's kind of the, you can be a spectator and still get a chunk. Well, here, it's very targeted.
And then, of course, moving on to 2025, we're looking at your own organization potentially becoming a spun out company. Plenty of time. We're not in a rush. And finally, Progressive Water Treatment, which itself has some trade secrets that are worthwhile and then future incubation of other things. But these five properties Water on Demand, $H2O, EveraMOD, Modular Water and Progressive are the sort of jewels in the crown that we're willing to roll out.
And in this model, OriginClear again is the mothership that enables each one of these to be very tactical, very focused. And I know you love doing finance and legal and all that HR stuff, so we're going to take it away from you or you just do it. Sorry.
Dan: You can have it all. You can have every last bit of it, Riggs.
New for the Water Industry
Riggs: I think Marc Stevens feels the same way at Progressive Water, you know, and Manuel at Water on Demand. It's like, look, let me do my job. And then OriginClear gets management fees, which enables it to be as a mothership, to be profitable and itself go on to the Nasdaq because you've got to, you've got it yourself, a chunk of OriginClear as one of the restricted stock grantees. So what I like about it is, is it creates this cool launchpad role for OriginClear, which is very unique in the industry. We don't, we have them in Silicon Valley, we don't really have in the water. Right.
Dan: We don't really in this industry that doesn't exist. And to a certain, to certain respects, we are, we do look very similar to what you're describing in Silicon Valley when it comes to the water world. I totally agree with you.
Riggs: So OriginClear has that role and eventually gets monetized as such and has a big chunk of each one of these companies for its pains. But then each one of these companies becomes, and we end up with half a dozen public companies, of which OriginClear has a big piece. So the OriginClear investors and sweat equity players like you are rewarded there, plus targeted funding, which may be unconventional.
You know, for example, we're not when we eventually start playing in the blockchain space, it might be a completely different way of funding things, more crypto and less about, you know, trying to take it through the standard registration model, which is problematic for crypto. So it allows us to be very targeted. Each organization gets its own path and its own economics, you might say.
Dan: Right, right.
Riggs: So it's isn't it starting to get interesting, huh?
Dan: It is. One comment I'd like to I'd like to make. And for the audience, the greater audience is listening and the like, the rollout, the legwork and the progress that we've made over the last couple of years. And with the impending rollout of the EveraMOD business unit as a standalone corporate enterprise, that lets us really refine and perfect this process.
It sets the stage for these other business units to follow a very similar path. And that is, there's power in that. There is, it really allows us to get very efficient and very focused as we take it from one unit to the next, to the next unit and not have it all just this big, huge conglomerate that you can as you've been describing.
Revenues and Forecast
Riggs: Exactly. And I wanted to do one last thing, which is to look at the historical numbers with a bit of a forecast here. Going back to 2019, we see that the blue bar is Modular Water. And so combined the blue with the green, we see it running roughly roughly $1,000,000 a quarter, which has been the run rate for years now. But a big change happening with tripled orders in 2021. So PWT taking off and of course, you're taking off as well because of the growth this year.
And so the blue bar takes off. And even though you're carving off EveraMOD in the yellow, you're still seeing strong growth. So the combination is strong. But now we have three business units which themselves are showing good profits.
In fact, here is the gross profit picture where really gross profits really took off last year as we started hitting certain volume numbers. And it looks like it's going to continue to grow. And so that is very healthy. I can tell you that any time you can present to the market companies that are profitable and growing as themselves, it's very, very people are going to for example, we're starting to talk to family offices and and high net worth individuals and small funds.
Riggs: A fund might say, you know what, I want to go into pump station business, we'll fund this whole thing. And then it's going to be a competition for people to fund these things. You know, it allows us to really give people a very targeted investment in water, which is the emerging asset class. People are starting to realize, wait a minute, government monopoly is falling apart and more and more commercial work is being done in water. And where is the funding?
Well, the funding comes from all the different places, where we're providing funding from regular investors coming in, for example, Water on Demand, etc., and people from regular accredited investors all the way up to family offices, ultra high net worth individuals. And eventually funds will be able to have a targeted role in an asset class that hasn't topped out, like real estate has or like commodities have. You know, oil and gas is great, but who knows? It's going to crash tomorrow, it's terrible. So, whereas water is very stable recession-proof. It's at the beginning of its run.
Dan: It is.
Riggs: It is super cool.
Beginning of Its Run
Dan: It is super cool. It is. It is at the beginning of this run, I think the world is much more intelligent, much more sophisticated, and have a much greater understanding of the importance of of decentralized applications, water and wastewater, and for even greater centralized utilities, for that matter. And the need the private sector investment in those things, there is nothing but huge upside, future upside for all of that. It is an untapped treasure trove is what it is.
Riggs: And of course, thank God, because water itself in the US in the world is problematic. You know, we've had the Flint, Michigan issues, Miami-Dade County, all kinds of places have issues with water and they're largely unsolved. And and really look at India, for example. Are they going to install a $50 billion sewage system? No,
Riggs: End of the day, it's all going to be decentralized.
Riggs: Point of views. Same in Mexico, for example. Right. All these different, interesting places that are growing fast, outstripping their infrastructure. And what are they going to do? They'll just simply put in place these these independent systems. And so I'm super excited about really being able to make a difference. Water and public health are closely related.
Golden Opportunity and a Triple Win
And Dan, I got to tell you, I'm so happy to have you on board as the inspirational designer, vision, all this. One last mention, I wanted to get into about Water on Demand, which of course, is this water as a service concept, is that we're excited about deploying your standardized modules as technology so that when we have these other water companies do the installation, let's say, in Seattle, Washington, and they're going to install it and maintain it, we want to let them license your tech so that the whole fleet that we build through Water on Demand is more standardized. It's not a bunch of patchwork stuff that then when we're trying to get some other water company to take it over, it's like, Well, what is this thing? Right?
It seems to me that it's a golden opportunity to let your patents and your trade secrets and your knowhow become exported to the water industry. And from what our experience so far is, people are excited. Like, you mean we can have that technology? Yes, you can. We're not only going to give you the business here, here's a check to pay for this machine. Here's a check to pay for you to maintain it. And by the way, you get to use the Modular Water tech. And I think that's a triple, triple winner.
Dan: Triple win. Triple win. It's a very powerful, huge, huge upside for I'm really super excited for the future and where we're going. We just the path is in front of us. It's ours to realize the success.
Riggs: Dan, thank you very much for spending a little time with us on this. We're going to play it for our Thursday night audience and there'll be some select clips, I'm sure. But I really appreciate you're, I know you're working nonstop and your team. Would you reel off the first names of the team?
Dan: Yeah, first names I've got Robb. Robb's been with us. He's been with us now for a little bit over three years. Mark, Mark just joined. We got him. He's our senior engineer guy. He is assistant production manager. We've got we've got other engineers, other folks that are, that we've been working with in third party relationships and they're actually getting ready to come on board in a full time role.
Don't want to release those names yet, but we've got a, really pleased. Tom, I'll mention Tom and Prasad and the folks in corporate, all of these folks. It's a team effort. One person cannot do this thing and it takes a team effort. And really, I'm just very thankful with the folks that I've got that are part of this team. They contribute all of their contributions to the program and to the effort and to the vision are just beyond expectation. We really we're building something very special.
Riggs: Well, Dan it's, well deserved on your part, and I'm glad that you're with us. So I want to thank you for this time. Keep up the good work and we'll maybe do another checkup and three or four months and see what further adventures you've gotten yourself into.
Dan: It's a date. I think everybody will be really surprised with what they see in three months from now. Going to be radically different again.
Riggs: Fantastic. Thanks again, Dan, and keep it up.
Dan: All right.
End of interview
Riggs: There we are with the super cool interview. And I think we really got into a lot of detail there. Put the microphone back we're supposed to be and just telling the reality of what's happening here, because, Progressive Water is a custom organization. They're doing really well. They're getting a lot of business. But the more business they get, the more. Oh, my God. Oh, my God. Why? Because they're making each one of these uniquely.
Modular Water is a standardized product line. And so all these numbers they're getting. I had him reel off the people, it's like him and three people! That's it. Right? Because so standardized, he uses a very good software program that I call manna because it's manna from heaven. But this, it's, got tremendous potential and breaking off EveraMOD I think we'll give it a chance to really shine. So I couldn't be happier with how things have gone here.
So I see there's a bunch of comments here that I'm going to just pull up here, but wasn't that cool? Keith Roeten says, "The incredibly amazing Dan Early." And then Eugene, you got the websites from Kevin who gave that to you. Eugene's brother, brother-in-law just got voted in to be a county commissioner, so we're going to get the inside scoop. So definitely.
People will realize how many pump stations and lift stations there are. It's well over a million in America and most of them are leaking. Most of them are breaking down. So it's really becoming the standard. So what I'm going to do now is step into the free wheeling discussion with my main man.
Ken: Hello. Hello.
Riggs: That was fascinating, wasn't it?
Ken: Yeah, it was great. Look, you know, it's funny because I'm. And having these discussions kind of secondhand from you. So I just got off the phone with Dan and blah blah blah. And so I'm relaying this to to prospects and to investors. And then to hear Dan say almost verbatim, what I've said in the last five conversations, people start to think I'm kind of smart, which is kind of cool. I just have good information, right? Maybe I'm not that smart, but I do have good info.
Here's what I thought was, what I pulled out of that conversation. I don't know if investors did, but we created something brand new by essentially applying a fintech application to a centuries old industry, by creating a decentralized water, water, water as a service, funding it like an MLP. These are things that all people know, but it's never been done this way.
But people always say to me, So you're going to go into cities? And I go, No, no, no, no, no, no. Because, because of the layers of bureaucracy and blah, blah, blah. But there is a gargantuan existing industry that has an immediate, urgent and desperate need for pump stations. And we've now become an industry. We've kind of become an industry standard.
Becoming the Brand
My understanding is that national account, who shall remain nameless along with another household name, massive company. Right, billion, trillion dollar company. They bypassed the bidding process and went right to our design because it was like, now we need that. That's fast, right? Once we're able to discuss these things, please God soon. So once we're able to discuss these things, other companies, you know, they look to these industry leaders and they go, wait a minute, what are they doing? Why are they or why are they doing it? So what happens is we become the Q-Tip. Right?
In other words, you become the brand. Right. Q-tip was the name of the brand. It wasn't. It wasn't cotton swab. Right? It was. It was. So it becomes the brand. He said and I said to somebody today, a guy named Tommy, who I spoke with around 4:00. Tommy, if you're listening. Hi. I said there's millions of pump stations that are in some state of. Advanced disrepair, right. Some stage of advanced corrosion. And they all need to be replaced within the next decade or two. And there's literally, you know, it runs in the billions and billions and billions of dollars.
Mending a $100 Billion Wound
So not only are we going to be innovating in providing a Water4Us, decentralized water model, but we can have an amazing impact on this gargantuan existing water infrastructure business that we constantly say is archaic and we can modernize it. And my understanding is, is that with this falling apart, concrete and stuff like that, we've now developed a way to drop these in right in the sleeve. Right.
So we don't have to you don't have to go with a big land mover, the backhoe, and dig the damn thing out and pull out the busted concrete, you know, and make a gigantic mess. And it's a weeks long process. We can literally cut it, drop it and walk. Right. That would make us I mean, that's just, you know, add to what we're doing on the creative side. This is a very creative way of mending a $100 Billion wound in our water infrastructure. So that's exiting.
Riggs: People will realize how important it is because the water leakage and also when the sewage leaks into the ground, the aquifer, all this stuff, the state EPA's are the departments of environmental management in various states are up in arms about this stuff, rightly so.
I must say, by the way, Paul Fetscher, my main man, Paul says, "We can only imagine the exciting things to come in the next three months." Dan is piling things one on top of the other and he may have a beard, but he's young.
Ken: I am. I was personally, I thought hearing it from Dan. Dan is really a good communicator.
Ken: But he comes at it from a very practical engineering point of view. He is an evangelist of what he's helped create. But he also describes it in a way that you and I, coming from a tech and a finance world, would not. He comes at it from a very application based language type language set, which I think for folks that kind of are more familiar with the industry must be very refreshing. I love having him on. I really do.
Riggs: Yes. So he was real fine. But the funny thing is, you know, we brought him on the last week of June 2018, which is now more than four years, and we had no idea how long it would take. You and I.
Ken: I was on those conversations, by the way. You and I just had an anniversary.
Riggs: Oh, that's right.
Ken: I didn't get flowers. I didn't get chocolate. I didn't get poetry. I got nothing.
Riggs: But I took your call.
Ken: Yeah, you did. And the third on the third time, no. So, yeah. So Dan and I kind of joined the organization within a few months of each other.
Riggs: That's true.
Ken: Where did you say May now?
Riggs: He was last week of June 2018.
Ken: Last week of June.
Riggs: You were July.
Ken: July 1st.
Ken: Yeah. So. So that was a busy week.
Riggs: No, it was crazy. And so at the same time, of course, I was winding down. We were hitting crypto winter and I was winding that down. It was crazy, crazy. But here's the thing, is that and what we learned from this is that these these big brick and mortar plays, just like real estate, they go like this, like this, and finally they hit critical mass and they start taking off. That's what we're seeing with Modular Water. And as I was saying, it's a product, not a handmade thing. And so it has an opportunity to really grow. So this can be lots of fun. And yet Gene says "Didn't even take you to dinner." Yeah, well.
Ken: He did pay for the Corinthia.
Riggs: So that's true. Ken had too good a time in London and I think he's told his wife how nice it was.
Ken: If you, yeah, if you call 12 hours sleep in four days fun. Sure. It was awesome.
Riggs: Who needs to sleep in London?
Ken: Me. Me. That would be me. Yeah, but no, it was. It was great. It was great. And I am, I'm enjoying our correspondence with our, with our current family offices that we're communicating with. I think that's going very, very, very well. And I would hope that we, look I think we should at least discuss doing New York. We'll see what happens. Right.
Riggs: We've got a couple of New York opportunities. We'll be talking about that.
Ken: So it's a lot easier on me.
Riggs: Important thing is as we move up into the more sophisticated investors not to go too high.
Ken: Sure no no no.
Riggs: Super funds, and like do you know who I am? And all that.
Enthusiasts Who Get It
Ken: No, let me tell you the difference. Let me tell you the difference by the guys we're talking with right now. They walked over to me and they were like, we did this in energy. This is super exciting. We really need to. They were also enthusiasts, right? They weren't the stodgy, you know, bushy eyebrows. Let's see your 20 year... You know, they were kind of like, no, this is super cool. We super get it. We love it. And we've made a lot of money, you know?
So one of the families, the father, he's Asian, made a fortune bundling up power purchase agreements. So when I started talking about water purchase agreement, the guy finished, the guy, Ken was finishing my sentences for me, right? So I was like, All right, I get it right. So I do believe that you're going to find more and more true enthusiasts in that crowd.
Now, I think as things get worse and I think they will get a little tougher before they start to turn around in the first quarter of next year. I think more and more of your traditional asset investors will have a kind of a stomach to get aggressive on something, provided it has that securitization.
You know, they're not going to do the dice thing. That's not that's not that's not the way they're built. But with with commercial real estate and all that stuff being so, so, so dodgy right now, I do think that talking about our broader vision and really talking to the kind of the large player but enthusiast, right, I think we're going to have a lot of success going through the back end of this year, especially when we start to drop in these first. Contracts. These first WOD assignments.
Riggs: Correct. And that's going to be what I'm going to be discussing next week, where we're zeroing in.
Ken: You know that I just led you in perfectly.
Riggs: I know. Well, you know, because, you know, we've been doing a couple of things together here and there, you know.
Ken: Right. It's like an old married couple. We finish each other's sentences.
Riggs: But seriously, we are, we're focusing and we're starting to learn where again, my my motto, which has worked with the enthusiasts, never with the conservatives or the skeptics. We're learning where the enthusiasm is versus where people are go. Well, I don't know. It's an issue. What about this? What about that?
Ken: Get back to me when you know, that's fine.
First Commercial Pilot
Riggs: Exactly. So I'll be filling in the team on that. I'll probably bring Manuel in to brief us, but lots of good, maybe even Bill Charneski might join us. He's the veteran who's been on board forever. So that is next week. And it's super important that we get our first commercial pilot. We don't want to have a bad one. We don't want to wreck ourselves rushing into it. I'm reading a book about the war in the Pacific and about Admiral Halsey in the battle of Leyte Gulf. And he just charged.
Ken: It didn't turn out well.
Riggs: No, I did not go well.
Ken: So you don't get it and you don't get a mulligan on a battlefield?
Riggs: No. And a lot of people lose their lives.
Ken: You don't get a mulligan in what we're doing either. So and I've explained to a lot of people, look, the first one's going to take forever because you don't know what you don't know. And it's going to have to run through legal team a million times. Now, most of these things, all aspects of water as a service has been done by somebody. And yes, our partners are familiar with them, but we're adding elements to this that have not been added. So rather we take weeks on the first contract and get it 95% right, then get one done in a week and basically have it half wrong. Right?
Riggs: And then we're crash trucking it and the whole thing.
Ken: Exactly right. And now you're now you're trying to play you're trying to play catch up. So undoubtedly these will evolve somewhat. We want we want that evolution in in the second and third and fourth stage to be extremely minor, just basically fiddling at the edges.
Riggs: Good. Well, that sounds perfect. I want to thank everyone for jumping on guest all the way to the end. And I'm looking at the list of all the cool people, all the cool attendees.
Ken: This is where all the cool kids hang out.
Riggs: Oh, my God, this is the cool place. So I'm glad. I'm glad everyone's on board and supporting us. I really well aware of your support at all times. We love you and we're going to keep just going flat out. I'm having more and more fun and the main reason I've been having fun is we have a bench, we have great people. So I'm able to say Here, Dustin, take care of this. Both that thing goes away and Dustin takes care of it. Thank God. So thank you, everyone. Ken, it was a pleasure having you today.
Ken: Always a pleasure, sir. We'll see you tomorrow.
Riggs: And on your work anniversary, so to speak.
Ken: And my work month, it's my anniversary month,
Riggs: Anniversary month that gives me a chance to send you flowers.
Ken: There you go.
Riggs: Thank you, everyone. Have a great weekend and do tune in next week. We'll report on this commercial pilot for Water on Demand.
Ken: Goodnight, folks.
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