At RITMO, we are entrepreneurs like you, and we want to tell you about our entrepreneurs who inspire us with their stories so that every day we can continue with our mission: To support the growth of eCommerce
We want to introduce TAPP Water, a company that fights against the use of single-use plastics, with its innovative water filter
About TAPP Water…
TAPP Water was launched in Barcelona in 2018 to empower people to easily get clean and healthy water from the tap, with a minimum environmental impact. The company offers the first recyclable water filter that provides clean and fresh water directly from the tap in a sustainable way.
In addition to being eco-friendly, TAPP Water helps users to save 15 times more per liter than conventional bottled water. Additionally, it also saves space (no need to store bottles) and time (no need to go to the supermarket).
Distribution Channels
TAPP Water's main distribution channel is through their website, they also sell through Amazon, and recently they have started to sell in some physical stores in Barcelona.
Founding Team
TAPP Water was founded by an international team formed by Magnus Jern, Alexander Schwartz, Rocio Alcocer, and Jeff Cardorelli, who shared a deep concern about zero waste and protect the environment. Their main objective was to reduce the pollution and plastics generated from bottled water by providing an alternative with zero environmental impact through filtered tap water.
TAPP Water in Numbers
Since it was launched in 2018...
- +50 M plastic bottles avoided
- 1,3 Mt plastic avoided
- 10t CO2 avoided
Key Business Growth Drivers
Once they have developed a product that fits the market and set up all the logistics, their main objective is to attract customers. The company’s main growth driver is to invest in marketing to capture new clients. Magnus, one of its founders, explains to us that they make a large investment in marketing since their customers have a big Life Time Value as their product is based on a subscription model and high recurrence. Once the customers are on board it is easier to retain them thanks to great customer support and experience.
Funding
- Own Founders & FFF → capital provided by the founders themselves and their family and friends to start initial research and development of the product
- Public Grants → they have been awarded public grants such as the European Commission's Horizon 2020 program for working towards waste reduction
- External Investors → have raised about €2,5M to date from early-stage investors to further develop the product and the logistic network
- Revenue Based Financing → work with RITMO to raise growth capital to fuel their online marketing campaigns.
Main Challenges
TAPP Water has faced four major challenges according to Magnus:
- Complex product to develop → They have had to invest a lot of resources in research and development to create a quality product that fits the needs of the market.
- Logistics network difficulties → Because it is a physical product and not software, they have had to deal with making agreements with factories, taking into account production and transportation time before offering the product to consumers. Making it all work has been a big challenge.
- Immature market → As it is a very innovative product, educating consumers and finding the right message to transmit has been complicated. They currently have a large customer base, especially in Barcelona, and are looking to open up to new European cities following the same strategy of informing and educating the market to make their brand known.
- Problems with cash flow to meet marketing expenses → As the LTV of TAPP Water's customers is quite large, so is the marketing investment to attract them. The company's cash flow does not always allow this investment to be made in advance, which is why tools such as RITMO have been decisive in achieving their goals.
How RITMO Has Helped TAPP Water
RITMO has allowed TAPP Water to have more cash flow to invest in its marketing strategy and growth faster, allowing it to attract new customers without having to dilute.
According to Magnus, the whole team was very surprised with the speed and ease with which they were able to sign the contract and get the money for their marketing campaigns.
In addition, TAPP Water's founder notes that at first RITMO can be a complicated product to understand because it is not a common funding model in countries like Spain, but once the team helped him understand how it works, it was the best decision for the company to avoid dilution while at the same time allowing them to grow so fast.
Magnus' advice for entrepreneurs
Just do things and on trial and error and continue to test and test and test until you get it right, and once you get it right, then you can start focusing.
Magnus encourages all entrepreneurs who are just starting not to give up because things don't work out, but to work on trying and testing different models until they find the right one. In this process, customer feedback is very important to know if you are moving in the right direction or if you need to keep on pivoting. You shouldn’t wait until you have a finished product to go to market because probably it may not fit well and you will have wasted your time.
