Why this Californian company prefers Aussies to ‘get rich quick’ Americans
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The patience displayed by Australian investors is what prompted a global leader in water and wastewater treatment solutions to list on the ASX, executive chairman Richard Irving has revealed.
Fluence Corporation’s (ASX:FLC) executive chairman described Australian investors as far more enduring investors than US investors, representing a huge opportunity for the company to test Australian investor opportunities.
“One of the biggest problems in tech investing here in the US is that as soon as a company shows a little success, the investors want to bail out in search of something else,” Mr Irving told Stockhead from his San Francisco office.
Anecdotally, Australian investors are known to leave their money in longer, he said.
“I’ve got business colleagues with strong connections to Australia, and they tell me that Australians are known to be more long-term investors. They’re not just trading in and out. There’s more institutions involved in trading in Australia, too. They recognise the value proposition and they jump in and ride it for longer,” he said.
“There’s bigger money to make from long term investing. But here in the US, there’s a mentality toward getting into the get rich quick. That’s just the mentality of the typical Silicon Valley investor.”
Mr Irving said innovation in the water sector can be a slow burn. The company provides local and sustainable treatment and reuse solutions, empowering businesses and communities around the world to make the most of their own water resources.
“Innovation is the water sector is extremely difficult to achieve. That’s because treating water is hard. You can’t fail at it, even failing for one hour is completely unacceptable in this space.”
Mr Irving likened tech advances in the water sector to the adoption of the mobile phone decades ago, saying underground pipes have replaced giant centralised plants over the years.
“Our treatment solutions are scratching the itch of the market. China, for example, has a five year plan to introduce wastewater treatment solutions, presenting huge opportunities for us.”
Meanwhile, Fluence Corporation has just announced that an unnamed top tier US financial fund has taken a $US10 million stake in the company, which coincides with a rapid expansion phase. “I’m glad to see this endorsement in what we’re doing. The water sector isn’t well understood, particularly around how valuable it is.”
The global water sector is estimated to be $US700 billion annual market, Mr Irving said.
“We hope this initial investment will be a stepping stone for future support from this, and other high quality funds.”
Fluence Corporation listed on the ASX in 2015 at 20c. The stock price has lifted to .78c, which Mr Irving said proved the company was better positioned to build value over a period of time. The company has approximately $US48 million cash on hand.