New CEO of Quench USA is Thirsty For Growth
Philadelphia Business Journal - jan 14 2011
"Quench, based in King of Prussia, provides point-of-use water filtration to more than 20,000 businesses and has more than 50,000 of its bottleless coolers currently installed nationwide.
With financial backing from private-equity investors Element Partners and Virgin Green Fund, Quench aims to significantly exceed the market’s typical growth rate of 10 percent to 15 percent. The private company made four acquisitions last year and is looking for ways to expand geographically, most recently by looking eastward."
Quench has positioned itself as an environmentally friendly alternative to water coolers that use plastic water bottles, which have a higher carbon footprint than water filtered from a tap.
“I love the fact that [Quench] is a green business — that sustainability is a real business imperative these days and no longer just a fad,” said Ibarguen, a resident of Villanova with degrees from Boston College and Harvard Business School. The company estimates that its bottle-free cooler system has saved 183 million gallons of water and 3.6 million trees.
Ibarguen was previously the director, president and CEO of Insight Enterprises Inc., a tech company. Coming from that background, he says he’s used to a high-growth pace.
“You have to be able to handle a lot of different things at the same time,” said Ibarguen.
Philadelphia-based Quench Has Garnered $30 Million In Funding For Expansion
CNET News - oct 13 2011
Philadelphia-based Quench has garnered $30 million in funding for expansion, the company announced Thursday.
Quench makes water coolers with built-in filtration systems that tap into a building's existing water supply instead of using water in five-gallon plastic jugs that need to be regularly delivered and replaced. The company makes free-standing and countertop water coolers and ice makers.
The coolers use a reverse osmosis water filtration system that includes a sediment filter, an antimicrobial filter for killing microorganisms, a carbon filter that removes things like chlorine that might change water flavor, and a lead filter for reducing heavy metal content. They also contain a phosphate filter that reduces the amount of minerals, such as calcium and magnesium, which also prevents water scale buildup in things like coffee makers.
The machine also has an internal ultraviolet light system for self-sanitizing that kills 99.99 percent of bacteria, viruses, or parasites that can sometimes be found in and around the moist parts or holding tanks in water coolers. Both the filters and ultraviolet lights for the coolers are collected and recycled by the company.
Quench also uses stainless steel tanks and parts for holding and distributing the water, which in addition to maintaining a plastic-free taste also eliminates exposure to plastic toxins.
"This funding will accelerate our growth in key markets across the country, as we continue to capitalize on the trend of businesses switching to filtered water coolers from traditional plastic-jug water coolers," Quench CEO Anthony Ibarguen told investors.
The company says its water coolers have caught on and its clients now include about a third of the Fortune 500 companies.
It's not hard to figure out why water coolers sans plastic water jugs might become popular. At a time when companies are looking for ways to cut costs, a water cooler that both uses inexpensive tap water, and offers a greener option that might contribute towards company sustainability goals seems like it would garner a lot of interest.
Quench is not the only company attempting to reinvent the office water cooler. Haier's Aqua Fontana water coolers offers bottom-installation of tanks, so you don't have to do the precarious flip to install the five-gallon jug at the top.
The EcoloBlue 30 Atmospheric Water Generator takes things even further. Their water coolers don't even require a tap water hookup. The system dehumidifies the air and sends that collected water through a series of filters to produce drinkable water. They also offer a solar option so you can have a water cooler that doesn't even need to be plugged into an electrical outlet.
Investors in this round of funding include previous Quench investors Element Partners, Virgin Green Fund, and Douglas Brown in addition to new investors ORIX Venture Finance, Advent-Morro Equity Partners, Potomac Energy Fund, and The Pohlad Companies.
Quench, a King of Prussia firm run by Safeguard Scientifics veteran Anthony Ibarguen, says it has raised $17 million in equity and $12.5 million in borrowed money as it builds and buys a national network of "no-bottle" office water systems.
The system uses activated charcoal, ultraviolet light and, sometimes, reverse osmosis to freshen common tapwater. It is a cheaper replacement for the familiar five-gallon jugs trucked into offices and factories.
Quench has installed 50,000 systems, including 8,000 in the Philadelphia area. Customers include Comcast Corp. and the University of Pennsylvania, said chief operating officer Todd Peterson.
The new money, on top of more than $50 million in previous equity investment, comes from a variety of sources.
They include David Lincoln's Element Partners in Radnor, British entrepreneur Richard Branson's Virgin Green Fund, and veteran American and Caribbean water-systems investor Douglas Brown, who serves as Quench's chairman.
New investors include Orix Venture Finance of Washington, Advent-Morro Equity Partners of Puerto Rico, Potomac Energy Fund of Frederick, Maryland, and Pohlad Cos., of Minneapolis.
Why King of Prussia?
Quench Co. started as a roll-up of seven companies that were all regional water-systems dealers, according to Peterson.
It moved from Indianapolis to King of Prussia, where one of its predecessor firms was based, when nearby Element first invested in 2008.
Quench employs nearly 200, about one-third in the Philadelphia area, Peterson said. He estimated staffing could be at 300 by the end of 2012.
Quench is less labor-intensive than loading the five-gallon jugs and carting away the empties.
"We visit once a year to service, mostly," Peterson said.
Quench, the largest independent provider of filtered water coolers in North America, announced today that it has closed on nearly $30 million in equity and debt financing. The financing will help support additional acquisitions and continued organic growth. Element Partners, Virgin Green Fund, Douglas Brown and other existing investors were joined by new backers ORIX Venture Finance, Advent-Morro Equity Partners, Potomac Energy Fund and The Pohlad Companies.
"We are thrilled to have the support of our new equity investors, as well as the vote of confidence from our new debt partner, ompaditqORIX Venture Finance," said Douglas Brown, Quench's Chairman. "The fact that institutional investors view Quench as an attractive platform in the current economic climate is a testament to the excitement surrounding Quench's value proposition and unique market position."
Jeff Bede, a Principal at ORIX, said "Quench's combination of recurring revenue and solid growth make it an ideal portfolio company for us. The business is growing rapidly and is well positioned for the consolidation of the filtered water services industry. We look forward to working with the Quench management team to help their continued growth in the filtered water cooler market."
Quench CEO Anthony Ibarguen added, "This funding will accelerate our growth in key markets across the country, as we continue to capitalize on the trend of businesses switching to filtered water coolers from traditional plastic-jug water coolers. We expect our growth will continue organically as well as through acquisitions of like-minded entrepreneurs in the filtered water industry."