Water chemicals and competitors: The long, long march of the ‘chemical-free’ revolution

Emerging market drivers – from tighter water quality regulations to corporate emphasis on water conservation to water-intensive applications in oil and gas exploration – have all opened the door to new chemical treatments and non-chemical alternatives. In its latest report, Lux Research applies the Lux Innovation Grid to rank up-and-coming chemical and chemical-alternative companies, and identify the most likely winners.

The report, titled “Water Chemicals and Competitors: The Long, Long March of the ‘Chemical-Free’ Revolution,” identifies the emerging companies and technologies most likely to survive and thrive in key treatment markets, including drinking water, wastewater, cooler and boiler water, desalination, mining, industrial, and oil & gas.

In order to distinguish winners from losers, Lux Research conducted more than 60 interviews with companies competing in the space, and assigned them scores for technical value, business execution, and maturity. Based on these scores, analysts plotted each company’s relative potential on the Lux Innovation Grid, which comprises four quadrants: Dominant, High-Potential, Long-Shot, and Undistinguished. Among the report’s highlights:

  • Halosource stands out in the crowded drinking water market. Deepest into the Dominant quadrant is Halosource, which enjoyed 20% revenue growth to $14.1 million in 2010, and is poised for faster growth with a smart partnership formed in February 2011 with Fairy Industrial Ceramics, a filter manufacturer. Halosource’s technology combines a slow-release bromine disinfectant with a filter to create a complete water treatment system writ small. Another notable player sits in the High-Potential quadrant: DXV Water Technologies, which has a passive flow technology that could significantly reduce surface footprint and chemical use.
  • SCFI seeks to eliminate additives and traditional treatment altogether for wastewater. Another Dominant start-up, SCFI, is fielding a self-perpetuating wastewater treatment that eliminates complex organics through complete oxidation while allowing for retrieval of metals and phosphates. The company has smartly partnered with Parsons Corporation and Rockwell for engineering support and better market penetration.
  • Sensor-maker Neosens sits in the High-Potential quadrant. Water testing is a complicated affair involving antique methods and often toxic reagents. Neosens is changing that with a unique application of a flexible micro-electro-mechanical (MEMS) platform that senses early signs of fouling – a critical parameter in cooling and boiler water systems. Its business execution lags, but expect that to change once Neosens is snapped up by a larger competitor like Danaher or GE.

“Water Chemicals and Competitors: The Long, Long March of the ‘Chemical-Free’ Revolution,” is part of the Lux Water Intelligence service. Clients subscribing to this service receive ongoing research on market and technology trends, continuous technology scouting reports and proprietary data points in the weekly Lux Research Water Journal, and on-demand inquiry with Lux Research analysts.


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