SmartPaani: Rainwater Harvesting System as a Social Business Enterprise

SmartPaani’s journey provides useful lessons to Nepal’s policy makers and households about the role social business enterprise that practice fair business play in providing such services. Pursuing a fair business practice, SmartPaani will bring new perspectives and make the company a part of sustainable drinking water solutions in Nepal.

In the 1980s, I was a student in a school in Kalimpong, the picturesque town of West Bengal, India.  The town faced severe shortages of drinking water and a family would receive supply in turn. Those with resources would get a connection for a price, but only until someone else paid more in the coming week. Waking up at unearthly hours and squabbling with a neighbor had become a norm. I had decided then that if I get to make a house for myself, a regular and reliable drinking water supply will be a priority.

Drinking water services in Kathmandu Valley’s Patan city where I live since 1995 was similar. We would buy two tankers of water a month at our family house to meet our needs. This was expensive and we looked for cheaper solutions. On many occasions when I would meet water professionals like Ajaya Dixit, who began promoting the use of the Rain Water Harvesting System (RWHS) in the early 1990s, they would talk about the role an RWHS could play in fulfilling a household’s domestic water needs. An RWHS would divert rains falling in one’s house roof to a storage tank for later uses. As a decentralized arrangement, RHWS can also be used for recharging groundwater through open wells. It has minimum operation and maintenance costs.

Despite being aware of these benefits, I could not convince senior members of my family to build a system in our house and our water woes continued. Later, my friendship with Tyler McMahon, a US national became a turning point. From 2007 to 2008 as a Fulbright scholar, Tyler had studied the potential of RWHS in Kathmandu. Both of us were members of the Everest Toastmasters Club and whenever we discussed potential topics for the club, RWHS would regularly emerge as a potential water supply solution to Kathmandu residences. I asked Tyler if building an RWHS in my new house would solve my water problem. He said yes.

Sainik Awasiye Mahabiddyalaya Bhaktapur (Photo: Smart Paani)

I agreed to build one and requested the engineering consultant constructing my house to integrate a system for collecting, storing and supplying rainwater. The consultant was not convinced. He said that the investment would be lost. I wanted to do away with our family’s harrowing experience of lack of drinking water and persisted. The RWHS completed in our house worked just fine with satisfactory water quality.

At that stage, I thought of many families in Kathmandu who faced drinking water challenges at their houses and asked myself if I could help them build RWHS. As an entrepreneur, I thought of starting a private company to provide that service and shared my ideas with Tyler. He agreed. In fact, he was already discussing starting a private company with his three friends. I became the fifth, and in 2011 SmartPaani was born.

Sainik Awasiye Mahabiddyalaya Bhaktapur (Photo: Smart Paani)

Friends and family members warned me that this was the domain of public service. Since donors were already providing drinking water services, they said, a private venture will be irrelevant. Many other well-wishers opined that I was crazy to get into uncharted territory. A few months after forming SmartPaani, I had participated in a training program conducted by an international organization on rainwater harvesting. I told the participants, “I am starting a private company and commercializing RWHS services backed by maintenance”. The bemused trainer had laughed at my proposal.

Indeed, many I/NGOs were building RWHS, but after service maintenance was not provided to individual houses or organizations. This would be SmartPaani’s niche market. Within a couple of months of operation, SmartPaani was breaking even and in the next couple of years, the company doubled its turnover. In the last ten years since it began in 2011, SmartPaani has installed RWHS in 4000+ residences and institutions. It has also implemented and maintained, 300+ public schools RWHS that collectively provide drinking water to 75,000+ students in Nepal’s 28 districts. In one year, 60 million liters of rainwater is harvested, 170 million liters of water is recharged and more than 10 million liters of wastewater is treated/recycled. The company also provides maintenance services to the satisfaction of the majority of its customers.

SmartPaani became part of the drinking water service provider ecosystem in Nepal. It worked with the Rain Foundation, WASTE and Simavi of the Netherlands to expand our activities outside Kathmandu Valley. The company has also worked with Splash International and Dopper, Netherlands. It is currently engaged in a project supported by DEG, Germany.

In 2013, SmartPaani was awarded ‘Surya Nepal Asha Social Entrepreneur Awards’, the company’s first public recognition. It used the prize money to install an RWHS at Durbar High School, Jamal and Tri-Chandra College. The system in Tri-Chandra College delivered water to Kathmandu’s Ranipokhari, the pond built by King Pratap Malla in the 17th century.

In 2017, SmartPaani won the Aim2Flourish Award for UN SDG #6 Clean Water and Sanitation operated by Case Western Reserve University, USA. Students of Yale University and The University of Edinburgh, Scotland prepared a case study of the company as a social enterprise. Subsequently, students from the Nanyang Technological University, Singapore, Delft University of Technology (Faculty of Industrial Design Engineering) and others have visited the company to discuss its business model.

Residence of the French Ambassador to Nepal, Lazimpat (Photo: Smart Paani)

Working with the UKAid, USAID, AustralianAid, and the Nike funded Spring Accelerator that worked with businesses in East Africa and South Asia helped SmartPaani experiment in incorporating WASH components including groundwater recharge and sand filter in its business plan.  While promoting its RWHS product, the SmartPaani team aims to upgrade two new products into the market: a Bio-sand filter for shallow well water and Tripti, its last-mile tabletop water filtration unit.

The major roadblock in marketing RWHS has been people’s perception of its effectiveness. People assume that if the RHWS works, its cost would be rather high. People also doubt the quality of the water filter. SmartPaani aims to address these concerns and scale up its operations nationwide by providing cost-effective, convenient and high-quality water-based services including technologies that supply drinking water to households with appropriate mineral content.

SmartPaani’s success is built on the combination of a hardworking technical team, lower overheads, the depth of knowledge about water and its economics, and technical acumen. The local network of the founders has also helped in expanding business. At the same time, the company has built bonds among its core team and its associates to drive the company. These have encouraged people to install RWHSs and use SmartPaani products.

The 2020 Covid-19 pandemic has hit SmartPaani hard, like many other businesses. Survival has become the new mantra and forced it to make internal adjustments and implement a business continuity plan as the old one has been jeopardized. Everyone in the company is rallying to normalize operation and ensure that the customer receives quality services. SmartPaani’s journey provides useful lessons to Nepal’s policymakers and households about the role social business enterprise that practice fair business play in providing such services. Pursuing a fair business practice, SmartPaani will bring new perspectives and make the company a part of sustainable drinking water solutions in Nepal.

Biography: Suman Shakya is an entrepreneur, consultant, and certified trainer. Since 1995, he has been involved in multiple entrepreneurial ventures and as an adjunct faculty of marketing and strategy. He is the founder of Tangent Waves, an action learning consulting, facilitation and training company. He is Cofounder in SmartPaani, Rooster Logic, Nepal Entrepreneurs’ Hub; Co-Chair Startup & Innovation Committee, Federation of Nepalese Chambers of Commerce and Industries, and District 41 Club Growth Director, Toastmasters International (2021-22). Suman Shakya lives and works in Kathmandu.

28th November 2021