A Machiavellian Plot For Clean Water

Along with a packed house, I recently had the privilege of hearing Peter Thum speak at Interesting Café, Clickable‘s monthly culture night. His work is a call to social activism – the idea that good business and good deeds need not be mutually exclusive.

As the founder of Ethos Water, Peter Thum has generated over six million dollars to help a half-million people around the world get clean water, as well as hygiene and sanitation education. He first had the idea for Ethos in 2001 after working in South Africa, where he saw water issues firsthand. He saw hundreds of people who didn’t have access to safe drinking water or sanitation services. In 2002, Peter decided to leave his comfort zone, then a strategy consulting job, to pursue his vision to address the world water crisis and help children get clean water. Peter Thum (PT), led Ethos as its President from idea through to its acquisition by Starbucks in 2005.

AM: When have you stepped outside of your comfort zone? PT: I’m happiest pioneering something new. So, I guess my comfort zone is when things are uncomfortable. I think that this is when individual value creation is most palpable and exciting. Waking up excited to do something is key.

AM: What would you say are some defining moments in your past? PT: My dad battled cancer when I was thirteen and died the summer before I started high school. I think that seeing his life cut short ultimately made me focus on what mattered to me in life. Also, in my last year of college, the Berlin Wall fell. I was interviewing for jobs and got some offers from different companies. It was sort of like a game. Looking back, I wasn’t really interested and didn’t really know what any of the companies really did. I remember the day I decided to move to Berlin, learn German and be at the intersection of that change. Since then, I’ve only pursued things that I found truly compelling.

AM: Can you describe one of your most memorable experiences from the time you’ve spent working in Africa? PT: Three years ago, I was visiting a water and sanitation program in a remote village in Kenya. The program was pivotal for the viability of their tribe. They greeted us when we arrived like all the tribes of that region do when they get a special visit. There, many of the people still wear traditional clothes. They danced and sang and pulled us into the dance with them.

AM: Is there anything you do on a regular basis that scares you? PT: Daily life isn’t scary (in a westernized country). I just got home from a trip to research conflict and small arms in DR Congo, Burundi and Rwanda. It wasn’t scary either, but there were moments of significant risk in the war zones we visited. Returning to the American reality is a little scary, however. We squander a lot of resources and power.

AM: How so? PT: I’m neither a psychologist nor a sociologist. But, I’d say that the depression and WWII were long enough ago that many of us have either forgotten, or never known what its like to go without, or to give up something for our country beyond taxes. Most of us probably take the benefits of our democracy and success of our economy for granted, because we haven’t had to risk our lives to preserve them.

AM: What is your best advice for someone beginning a new enterprise? PT: I have some thoughts based on experience:

· Pursue something that you would do for free, because you are truly passionately monomaniacal about it.

· People matter more than ideas a large majority of the time. Know and trust the people on your core team, because you will go through a lot together.

· Clearly define your risk tolerance (personal, family, financial) and that of your teammates before you get started.

· Deal with the share of equity/value contribution conversation before you do anything else.

· Work three jobs yourself to avoid a bad hire.

· Figure out how much time and money you need to launch the idea & then ask yourself how to pilot a version in a quarter of the time for a tiny fraction of the cash; like 3-5%.

· If you can, launch your business & get customers before you raise money from others.

AM: In starting up your company, you must have encountered resistance. Is there any principle that helped you stay focused on your mission? PT: A while back, I was having a meeting with a quite famous investor. In his conference room he had a couple of quotes framed. This one from Machiavelli really captured what you face if you are an entrepreneur: “… there is nothing more difficult to take in hand, more perilous to conduct, or more uncertain in its success, than to take the lead in the introduction of a new order of things, because the innovator has for enemies all those who have done well under the old conditions, and lukewarm defenders in those who may do well under the new.”

But if you believe in what you are attempting to do and in your ability (and that of your colleagues) to execute it, then never quit based on tough times or negative feedback from outsiders. Treat obstacles as necessary tools to improve your venture. Most people will tell you that what you are attempting won’t succeed. Understand their doubts, learn from them if you can, and then move on.

AM: What, in your opinion, is the most effective way to become an involved member of society? PT: Most people get involved in social activism and work that is not directly self-oriented when something happens to jar them awake. When they are personally affected. You can’t artificially create the impact of an accident of fate, though you can seek out opportunities to let yourself be affected by something. I would say “keep it simple”. Take advantage of the fact that you already have existing interests, e.g. faith, children, sports, nature, science, food, etc. Allow yourself to get involved in something that you already care about—someone in need at your place of worship or in a group you are a part of, a school, a park, a team; whatever—and it will just happen naturally from there. If you try to get inspired by something that isn’t compelling to you, it probably won’t work. But if it is rewarding and makes you feel good, it’s probably sustainable.

Peter Thum, the founder of Ethos Water, is a former strategy consultant who dreamed of providing clean drinking water to Third World countries by selling expensive bottled water in the West. His idea was simple: For every bottle sold, Ethos would donate part of the profit to clean-water initiatives in developing countries such as Honduras and Kenya. More than one billion people worldwide have no access to safe water. More than two million people die each year from illnesses related to unsafe water. Children die in disproportionate numbers because their immune systems are not fully developed. After three years of bootstrapping a concept that repelled most investors, Thum sold Ethos to Starbucks for $7.7 million in 2005. Already Ethos’s per bottle donations have increased by 263%. By 2010, Ethos plans to give at least $10 million by 2010 to nonprofits that fund safe-water projects.