The mining company's venture capital arm signed a Simple Agreement for Future Equity with the startup, which was founded in 2018. It invested US$200,000. "What we do is clean contaminated water. We process it and make it usable," explains its founder, Pablo Cassorla.
SQM Lithium Ventures , the company's lithium business venture capital fund, announced its first Simple Agreement for Future Equity (SAFE) with Remote Waters, a Chilean startup focused on water treatment for rural communities. This agreement allows a startup to receive investment and stipulates that the number of shares the investor receives will be determined at the time of a subsequent investment round.
“It means being able to have an equity stake in the future, should this startup grow into something larger, a publicly traded company. That’s it. It’s more than just a loan. It’s one of the valid options within Lithium Ventures. Several approaches have been studied to determine the best way to provide financing to startups. That’s what Lithium Ventures aims for. On the one hand, identifying fields that align with the company’s interests, in this case, and at the same time, taking a more financial and investment-oriented approach to see what the startup needs to grow,” Corrado Tore , Hydrogeology Manager at SQM , told Pulso .
“We found Remote Waters to be an interesting proposal because it targets a fundamental segment globally. Access to water and clean water is a problem that concerns a large part of the world's communities. Remote Waters refined this idea of providing a technological solution to deliver drinking water or irrigation water to relatively isolated communities . We found it to be a very interesting idea,” he added.
SQM Lithium Ventures believes this alliance is a step in the right direction , given the potential of the startup founded in 2018.
“We believe this initiative, the startup Remote Waters, has great potential . Our bet is that the startup will find a way to grow, to transform into a more solid company. That's where the idea of partnering with them came in. We believe we are the right partner to give them financial support and the vision of a large company, which they don't yet have. We believe their idea is sound , very well directed. We believe it's the perfect partnership , between the large company with resources and vision, and the small company with a very valid vision.”
SQM LV has already invested an initial capital of US$200,000 , and this could be increased. The company's stake in the startup has not yet been determined.
“That part has to be determined when it's decided how this company will approach a broader round of shareholders . That's when SQM defines what stake it will have. It depends on the potential the company is able to demonstrate to shareholders who aren't just us.”
Remote Waters was chosen from a wide selection of startups interested in the water sector.
Remote Waters
The startup, founded in 2018, is dedicated to addressing the lack of access to clean water that affects many communities in Chile and around the world. They have projects both within and outside of Chile. Its founder, Pablo Cassorla , explained to Pulso what the company does and praised the partnership with SQM Lithium Ventures.
“What we do is clean contaminated water. We process it and make it usable . We use adapted processes like reverse osmosis. We have a focus on rural communities. All of this is in a context of water scarcity and drought. We can treat water from the sea, rivers, and wells, whether for drinking water or for agriculture ,” said Cassorla.
He also stated that “we participated in the More Lithium and Less Footprint competition and won it at the time. The project consisted of purifying water from the Loa River and creating agriculture in the desert. That was our first entry with SQM Lithium Ventures . Then this first program opened and we were accepted... We started to question the business model and how to scale and combine our perspectives to become a global business.”
Cassorla sees this alliance with SQM LV as a vote of confidence.
“The impact is significant because, in general, the venture capital industry in Chile is quite focused on fintech, software, and applications. SQM Lithium is taking the lead and investing in entrepreneurs who are making an impact, and in our case, it's a service, which falls within their area of focus —not just lithium, but also water. A giant company is getting involved with us and giving us support. It represents a tremendous vote of confidence and demonstrates that we are indeed scalable.”