Antimicrobial paper Folia Water Filters

2.1B people drink fecally-contaminated drinking water. 500,000 people die annually from diarrheal diseases, and waterborne disease is responsible for 50% of hospitalizations in low-income countries, contributing to lower economic productivity and less equitable communities. Importantly, the core barrier for universal access to safe drinking water is the absence of products distributed with a scalable model capable of achieving habit change at an accessible price without subsidies. 

The Folia Water Filter is the first water purifier with grocery pricing: 20L for 20Tk, the same pricing as other FMCG products like soap, snacks, and SIM cards. Folia’s vision is to create a low-price FMCG water filter category by leveraging Folia’s patented low-cost manufacturing method. By reaching the last mile with a product adapted to our target consumer kitchen journey, Folia can tackle the health, social, and employment and productivity issues around consumption of contaminated drinking water. 

In Bangladesh, 38% of water is contaminated at the source, increasing to 62% at point-of-consumption (UNICEF, BD govt, 2018). In rural areas this is from contamination from a latrine adjacent to the tube well, or from inside the household. In urban areas source water contamination itself is often contaminated, e.g. 51% of Dhaka households and 48% in Chitatagong (Unicef). 

This issue impacts families across Bangladesh where a large gap exists between the willingness of low-income consumers to clean their water and the current offer of purifiers. Folia's Bangladesh team showed clear consumer demand for safe water and safe water products and a high willingness to pay at a grocery price point. Indeed, 70% would buy at a $0.10/person/week consumer good (grocery) price point vs. only 10% at a $35 durable good (appliance) price point. These data quantify Folia's fundamental business hypothesis: the majority of working class consumers want to buy safe water but they need a product sold at the same price point as other grocery store staples. 

Our innovation benefits the low-income working poor that earn between $2-10 a day. These consumers already buy FMCG products (e.g. soap and SIM cards), and are problem/solution aware. According to our consumer surveys and sales pilots in Bangladesh (with Unilever, BOPInc, and InfoLady Social), 90% of consumers are problem/solution aware. 70% are product/brand aware.

Women have a strong influence over the buying decision of the household, and are considered the “health officers” of the family. As such, the beneficiaries of Folia Water Filters are low-income families looking to gain agency over their health and their family’s development at an affordable price and at a place sold near their homes along with other staple grocery products. As such, Folia Water is not creating a market, but meeting a massive unfulfilled pain point.  

Though household visits, interviews, focus groups, and D2D sales in Jashore and Sirangonj, we have adapted our product design and marketing message. We have increased the flow rate of our paper, improved performance so that the filter purifies iron, and added visual cues for the customer, such as the paper turning color when it is no longer effective to remind the consumer to change the filter after 20L. 

Folia has invented a patented green chemistry process to use large-scale paper machinery to manufacture low-cost nano-metal functionalized materials that unlock new mass-market consumer good business models. 

Folia’s manufacturing method utilizes standard paper and coating machinery to synthesize silver nanoparticles on paper fibers through adding silver salts and other reactants as nano-silver precursors in a variety of locations along a paper mill line or as a coating or spray process. This is done by using standard equipment so that no modifications or capital equipment are required. Thus, the nano-metal manufacturing costs are 10-100x lower than other nano-metal processes because Folia uses commodity metal salts rather than buying nano-metals, in addition to being able to leverage the large scale and low-costs of standard paper machines.

This allows Folia to create new affordable consumable goods. The Folia Water Filter is an antimicrobial paper water purifier packaged like a coffee filter that retails at 20 Tk for 20 liters and is sold through mom and pop kiosk grocery stores. Through human centered design work in Bangladesh and Indonesia,  Folia has made its own unique consumer designs that fit into consumers’ existing kitchen water containers and therefore kitchen journey, while achieving a FMCG price point. The filter housing (funnel) can be manufactured and sold for 20 Tk: a low cost razor for our consumable razor blade, our paper. Because Folia is creating a new FMCG water purifier sub-category, Folia must provide a whole product solution which includes the filter housing; demonstration of the filter housing consumer fit; initial trade marketing retail recipe; manufacturing reliability at scale; business unit financials; and so on. The Folia Water Filter is the full value chain derisking required for an enterprise FMCG corporate to license or buy our product line for mass market distribution across an entire country. 

Patented nanotechology process enables new (old) business model: the world’s first grocery/FMCG water purifier

• IP around our manufacturing process

Folia’s nanosilver filter paper are the result of CTO and co-founder Dr. Teri Dankovich’s McGill chemistry PhD.  Folia’s patent-pending manufacturing process is simple and cost effective, which in turn allows Folia to create transformative new consumable products. Folia’s manufacturing process uses toll manufacturing paper mills and requires no capital modifications. This leads us to have the first consumable water filter that matches the quality and performance of durable goods priced at $20 or more for mere pennies. 

• Business model innovation: a B2B materials technology company creating a massive new mass-market FMCG water purifier sub-category

All other high quality water purifiers are sold as durable good appliances to upper/middle class.  A point-of-use water filter is needed at a consumable price point, meeting all other consumer functional/sensory requirements while coupled to the modern aspirational, higher Maslow sophisticated marketing of other consumer products. Folia leverages the marketing, distribution, and sales tools and scale of the FMCG sector, selling Folia Water Filters through enterprise-scale corporates as low-priced sachets through mom and pop kiosks in emerging markets alongside mass-market staples such as soaps, snacks, and SIM cards. By providing an affordable and easy-to-use solution to the last mile in a way that is convenient, working class consumers will have agency over their access to safe drinking water. 

Folia Water Filters kill bacteria/viruses/protozoans, and remove iron/dirt (publications, report, 3rd party tests upon request). Germs in drinking water are known to cause diarrhea and a variety of sickness/hospitalization (numbers above) with well-documented social, gender, women’s, children, lost work, effects (e.g. UNICEF, UNWASH). Our theory of change is to create a grocery staple water purification product that is as common as soap and toothpaste. That is, we leverage the distribution, marketing, and branding tools and activation and retail/sales tactics and tools of the modern consumer marketing industry which introduces and educates consumers on new products. By expanding from early adopters to mass market we can achieve the same penetration as soap or toothpaste, creating a universal product category.

To achieve mass-market adoption requires consumers that (1) value the problem and know the solution (consumer survey: 90%), (2) are solution and product aware (70%), (3) are willing to pay (survey: 70%@10 Tk/person/week), and (4) love the product and tell their neighbors (starting in our current pilot). 

Folia is currently selling our product D2D in rural Bangladesh as part of a Unilevr/DFID sponsored project that will end soon (requiring this funding for continuity/expansion). Consumers have already reported a reduction in gastric acidity and not needing to buy associated gastric relief pills. We have M&E measurements documenting the early aspects of the story above, but need to expand to city-scale to have a large enough cohort to measure quantitative outcomes.  

1. Current lean D2D sales pilot: 20 D2D sales agents have conducted 162 activation sales sessions reaching 1620 consumers, of whom 508 customers bought (31%), and 140 became repeat customers (9%).  The pilot’s aim is to prove consumer product-market fit, with a focus on repurchase rate rather than quantity of sales. During this Transform-sponsored sales test, customers have requested product improvements: iron removal, faster flow rate paper, and a more convenient lid. Adding these features increased sales from near-zero repurchase rate to consistent repurchase of higher flow rate filters and word of mouth leading to neighbors buying. 

2. Next year: in Q1Q2 we will test retail activation and sales channels including D2D, informal medical professionals, schools, and tokans, at a small village-scale (3,000 HH) level to provide  the retail recipe. The Tiger Challenge funding would enable that to scale to a 50,000 household city-scale retail launch in the 2nd half of 2020 which would provide a reference case for B2B corporate sales for a 2021 country-scale launch. 

3. In 5 years, we will have a master distributor selling the product across all of Bangladesh and the Bangladesh reference case will enable rapid B2B replication the same as any other grocery item into India and Indonesia via mass market FMCG corporates handling distribution and commercialization. We project a penetration of 7.5M households in 2023.

Folia Water has a six-staged commercialization approach for market entry:

• Consumer research, 2018: product design and marketing concept testing, initial marketing 4Ps: product, price, promotion, place. Bangladesh work led to $400k Unilever grant. 

• High touch consumer sales at neighborhood scale (1-3k HHs), 2019: informational feedback for iterative improvements in product and marketing concluding in consumer-product-market fit

• Low touch consumer sales at neighborhood scale (1-3k HHs), early 2020: test standard trade marketing tactics to establish retail sales recipe leading to below the line (BTL) referral sales

• Low touch consumer sales at city-scale (10-->50k HHs), late 2020: cost optimization of trade marketing tactics, reference case and business unit financials for CPG corporate marketing depts

• Country-scale launch across Bangladesh, 2021: $50M+/yr Bangladeshi FMCG invests in packaging, stock, marketing for major launch

• Replication, 2022+: replicate to adjacent markets regionally, then globally, through local/global FMCGs

Apart from scaling sales and therefore our impact, our goal is to improve water security and reduce the vulnerability of communities, most notably by contributing to increased employment and productivity in the workforce that comes from healthier families, and less time spent either sick or being preoccupied by health. 

Addition benefits include local jobs: assembly/packaging, plastic manufacturing, distribution, and sales. As a lightweight product, Folia papers are an extra grocery basket item, hence increasing livelihoods along the sales value chain.  We have established Bangladesh as our regional HQ and appointed our Country Director Rashed as VP of all of South Asia to oversee our regional expansion.

The major barrier for us in the next year is to gather consumer and retail proof points necessary to plan and execute a country-scale launch with a major Bangaldeshi FMCG corporate. Our ongoing sales pilots will provide consumer proof points to work with a retail distributor. This award would cover the larger scale city-scale retail launch, which is needed as a reference prior to a country scale launch. 

We are currently targeting 3k households at a neighborhood scale, determining the activation and re-touch mix prior to working with a retail distributor which would allow us to reach 10k-50k households. The Tiger Challenge would be transformative in allowing us to achieve these proof points, and use our sales pilot as a reference case to be able to move to the next stage of our growth.  

The key behavioral issues that we must prove are: consumer reuse, consumer habit formation, correct consumer usage including not overusing the product beyond 20L, below the line word of mouth consumer growth, and connecting all of these: consumers valuing the product and the resultant health improvements correctly. All of which will be measured and proven during the 3k HH retail pilot and 10-->50k HH city-scale retail launch. 

A key advantage to selling a consumer grocery product is that consumer and retail trade marketing tools and tactics are industry standard. We are not the first new consumer product, nor the first product requiring consumer behavior change. Emotional sentiment and messaging, marketing A/B testing, sales collateral and messaging creation, etc are all procedural and professional tools of the consumer marketing industry. Our Bangladesh staff does not come from the public health sector but rather from consumer goods marketing where consumer product education, habit formation, messaging, channel testing, touch points, branding, etc. are technical matters to be addressed step-by-step using consumer and sales data.  

We have purposefully started with high-touch relational sales through door-to-door (D2D) sales agents at small-scale, and will be adding informal village medical providers, school-based promotions, and tokan/tea stall sampling for high-touch relational trusted product education. Quantitative and qualitative consumer feedback and sales data are used to test the effectiveness of each marketing step from initial courtyard activation session to repeat touch points and repeat sales. Folia’s Bangladesh Country Director Md. Rashed has launched 12 brands, having previously been Head of Marketing at Navana and then simultaneously head of 3 BRAC social enterprises, driving profitable growth in both positions. Our Deputy Sales Manager Zia previously worked for Rashed executing sales operations. They have successfully worked with BOPInc and InfoLady Social to identify and fix product problems and have rapidly achieved repeat sales. Professional marketing leads to consumer habit formation, WoM sales, and sales growth.

Folia received a $400k grant for a 2019-2020 Bangladesh sales pilot from Transform, a joint project of Unilever and UK-DFID. This sales pilot is currently underway in rural Bangladesh at a small scale, and we are focusing on repurchase rate and identifying the right retail recipe and product design before scaling more aggressively.  Our sales effort consists of 20 female InfoLady Social D2D sales agents and is purposefully small to get detailed consumer product and marketing feedback as we eliminate problems and barriers. In Q1Q2 we will begin testing activation/education and sales channels as discussed above at a 3k HH rural village-scale to determine and demonstrate a successful marketing mix and sales recipe. We have begun enterprise sales to get a country-scale FMCG distributor partner during the city-scale launch with an existing distribution network. 

We have established a sales support team in Dhaka and engaged a law firm to begin the process of registering a subsidiary in Bangladesh. We are currently working alongside our consumer marketing agency partners, Base of the Pyramid (BOP) Innovation Center at their Dhaka office. This month we are finalizing moving our filter housing manufacturing from China to Gazipur eliminating the need for importation.  We began small scale packaging and assembly in Dhaka in Q1 2019 and scaling packaging capacity is an ongoing process in parallel to sales requirements. We have hired a local engineering design firm for new product design. 

Folia: 6 FT, 4 PT, but we outsource to partners along our value chain

R&D and product design in the USA: CEO, CTO, Product design engineer, 3 FT, 3 PT, various advisors

Marketing, sales, local supply chain in Dhaka: 2 FT, 1 PT

Supply chain partners, USA: R&D universities, corporate paper mills, coaters, toll manufacturers, QC testing, 3PL ...

Contractors in Bangladesh: 3PL, plastic manufacturing (employ 100+), paper converting/product packaging (employ 10+), design firm, marketing agency BOPInc (5+), sales agency InfoLady Social (20 D2D sales agents+ managers), activation agency, etc.  

Folia has assembled a team with a variety of expertise in paper production, water treatment, microbiology, nanotechnology, materials chemistry, consumer goods product/distribution, enterprise and retail trade sales, and consumer marketing.  

Dr. Jonathan Levine, Ph.D., CEO/cofounder has been involved with this technology for 6+ years and has been leading the business and technology advancements since 2016. Dr. Theresa Dankovich, Ph.D., CTO/cofounder is the technical lead, and has 12+ years of experience in research and development related to this technology, originally invented during her Ph.D. in Chemistry from McGill University.

Mohammed Rashed, MBA, Country Director, Bangladesh has 15+ years experience in all aspects of consumer marketing in Bangladesh. He joins Folia having been head of 3 different consumer paper/forestry product lines for BRAC social enterprises simultaneously. Prior to BRAC Enterprises, he was the Head of Marketing at NAVANA Group. Mr. Rashed is a Certified Professional Marketer (CPM-Asia) and Certified Professional Business Analyst (CBAP-IIBA). He has an ACBA-Advanced Certificate in Business Administration from Institute of Business Administration (IBA-University of Dhaka) and an EMBA in Marketing from American International University (AIUB).

Zia Uddin, Market Development and Activation, has a track record in trade marketing. Prior to joining Folia, he worked at BRAC Sanitary Napkin and Delivery Kit Enterprises and at GlaxoSmithKline. 

Mr. Shariful Islam is respobsible for designing advertising and communications materials. Shariful has a strong track record in planning and delivering persuasive engagement strategies and has served many local & international brands, social businesses and NGOs.

Product

-Topstar Cargo: 3PL, importation

-Polycon: manufacturing partners for filter housing

-Fair Communications: Printing, packaging, and assembly 

-June Engineering: product design engineering support, CAD

Sales

-BOPInc: expertise in consumer marketing, specifically base of the pyramid consumers. 

-InfoLady Social: network of door-to-door saleswomen and activation team

-Market Access Providers Limited: trade marketing and activation agency with country-wide network for UL, BAT, other FMCGs employing 3k+ agents

-Unilever: FMCG corporate, LOI and term sheet signed stating intention to sign a distribution agreement or incorporate Folia’s proprietary materials into its products. 

Legal

-Old Bailey: contracts, patent and trademark filing, subsidiary formation

Folia is a B2B materials company. To create a new sub-category, we cover the full Value Chain: we develop, patent, and demonstrate manufacturing at scale, do our own consumer product design, packaging, branding, and sales testing to prove the use case. This is a Whole Product Solution approach, which is required to move from risk-taking visionary corporate innovation departments to pragmatic brand marketing departments that control commercialization budgets. We then sell to large FMCG consumer goods companies with country-scale operations including importation, packaging, distribution and sales to mass-market grocery tokans throughout Bangladesh. We are an IP firm, with manufacturing through paper mills toll manufacturing with no capital modifications required.  

Our target demographic is working class Bangladeshis in the D/D+ consumer segment, which is a formally defined range of incomes, lifestyle indicators, and quantitative and qualitative attributes. As with any consumer health product, the mother is the family health officer and thus consumer marketing targets her, though fathers and other family members are purchasers as well. Family is all important in Bangladesh.

Market size

S+SE Asia: 2.5B consumers, 50-60% BOP ($2-10/day), ~5 people/household (HH). 250-300M HHs total.

Annual revenue: Folia wholesale $10/HH, retail $25/HH. 

SAM $2.5-3B Folia, $6-7.5B retail.

Bangladesh: 165M consumers, 16M HHs in our target demographic. 

If market penetration is:

10% early adopters: 1.6M HHs, SOM $16M/year Folia, $40M retail. 

30% early majority: 5M HHs, SOM $50M/year Folia, $125M retail.

We have three revenue streams to implement over different stages to bring our product and technology to market: 

1. Direct revenues from mass-market consumer good clients 

Folia is establishing a go-to-market strategy and retail sales playbook to reach working class consumers for replication in other geographies. The market trial focus is on proving consumer product-market fit through mass-market FMCG retail, to then transition to B2B2C sales through distributors. The current sales pilot is a reference to scale to a city-scale launch, which is the B2B reference case to get a master distributor to scale to country-scale. Once the low-price FMCG water filter sub-category is established, Folia can shift to selling material through FMCG product companies, dominating the physical supply and consumer mindshare of the active material. 

B. Revenues from IP licensing to large corporates for long term contracts

Folia has repeat product development revenue with a Fortune 100 food company to create a sustainable functionalized-paper mass market food packaging product. While still in product development, once complete, this becomes a 100% margin, with our clients managing the entire chain.  While a much smaller opportunity, it is much easier to get investors to pay for less risky work in the United States. 

We are also raising capital from VC funds in order to cover our commercialization costs. 

The Tiger Challenge will be catalytic as the funding will help us scale from a small rural sales test to a large rural sales launch in Bangladesh. In parallel, Folia will test the urban market. Our goal is to understand which market is most suited to us, and through which sales channel we should sell: D2D, retail, or both. Through this we can reach the proof points necessary in order to work with a large FMCG/CPG distributor. With this distributor we shift to a B2B materials company which will allow us to achieve mass market scale.  In summary, the Tiger Challenge resources will help us establish the reference case that will allow us to scale to the next stage of our strategy. 

As we expand our Bangladesh team, we are also looking for office space, mentorship (particularly on the operational side), and guidance on potential enterprise partnerships which is a key element to our growth strategy. 

We are looking for FMCG and distribution partners for our different stages of growth: city-scale launch, country-scale growth, and S/SE Asia replication. While we have Unilever interested in our product from a global perspective, we need a more local partner to achieve the proof points we need for success. 

2020, city-scale launch and 2021, country-scale growth: $50M+ FMCGs with excellent consumer brand reputation and trust such as: 

• ACI

• SMC

• Square

• BRAC

• Healthcare Pharmaceuticals Limited

• Bashundhara Group

• Meghna Group of Industries

2022, S/SE Asia replication: 

• Hindustan Unilever Limited

• Dabur

• Colgate Palmolive

• GlaxoSmithKline

• Marico

• Godrej Consumer Products