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Pathwater has a thirst for more capital

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Illustration: Maura Losch/Axios

Pathwater, a Fremont, Calif.-based sustainable bottled water business, is in talks with investors to raise additional cash, CEO Shadi Bakour tells Axios exclusively.

Why it matters: Bottled water is having a renaissance not seen since PepsiCo and Coca-Cola launched Aquafina and Dasani, respectively, in the 1990s.

Details: The opportunity to grab more share of the bottled water market is "so massive" that it would make sense to inject more capital, Bakour says.

  • The segment saw 73% growth between 2010 and 2020 and now generates some $270 billion globally, a figure expected to nearly double to $500 billion by 2030, Bloomberg reports.
  • The company has an unnamed investor that is willing to provide the necessary funding, but Pathwater isn't limiting discussions with other prospective backers.
  • "We are planning to see where conversations lead us," he says, declining to comment further.

The intrigue: "We're not in a rush to partner with a strategic," Bakour adds.

  • The right strategic beverage company, though, can provide access to distribution investment partners, he notes.
  • It's "the best way to affect change," but the strategic's intentions must be true, Bakour says.

Catch up quick: New funding would follow a $30 million Series A round led by Altos Ventures that the beverage brand raised last year.

State of play: Water safety concerns have increased demand for more sustainable versions of water bottles.

  • Pathwater sells water in reusable aluminum bottles, while competitor Liquid Death sells it in a recyclable, single-use aluminum can.
  • Both Aquafina and Dasani announced plans in 2019 to sell water in cans, but the products remain largely available in plastic bottles.

Reality check: As Pathwater points out, most bottled water is the same as what comes out of consumers' taps, which is why it encourages refilling by selling a reusable bottle.

By the numbers: Pathwater's revenue is currently in the eight-figure range, which it plans to double this year, Bakour says.

  • It sells in over 50,000 retail stores that include Walmart, Target, Kroger, Whole Foods, and Costco, as well as Barry's Bootcamp, Equinox, State Farm, and some luxury retailers.

What's next: After offering sparkling water flavors, the company could expand the portfolio to tea or kombucha, Bakour says.

  • "We're open to all beverage categories," he adds.

Flashback: The company was founded in 2015, with Bakour spending the early years delivering the product to 7-Eleven convenience stores out of the back of a beat-up Toyota Prius.

The bottom line: Bakour sees Pathwater becoming a multi-billion dollar brand that is focused on the planet before profits.

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