Uponor creates new intelligent water company with Belkin International
Uponor recently agreed on a new partnership with Belkin International to create Phyn — a new intelligent water company. Phyn represents the next wave of the smart home and will create an intelligent water solution that protects family homes and businesses from leak damage, enables mindful conservation and enhances household water usage with automated and anticipatory controls.
“Plumbing has essentially provided the same function for centuries,” said Bill Gray, president, Uponor North America. “And while it will continue to provide that essential function, we believe that real change is finally coming. We must find a better way to use our water more intelligently and with purpose.”
“Water is a precious and vital natural resource, but there has been a fundamental lack of technology dedicated to protecting and preserving it — especially for home users,” said Chet Pipkin, founder and CEO of Belkin. “With the creation of Phyn, we’re bringing water up to speed with the rest of the smart home, helping to not only protect consumers’ homes and wallets, but also do our part to solve the very real challenges facing our global water supply.”
The technology offered by Phyn will create an intelligent water system that will benefit an even broader audience beyond the homeowner. Builders can provide higher value as part of their smart-home offering; insurers can reduce their number one claim frequency and the number two paid-claims dollar amount — estimated at more than $1 billion annually in the U.S. alone. Utility companies can avoid costly investment into infrastructure by eliminating water loss and waste. Engineers can gain water-use statistics across a broad customer base as units become installed in hundreds of thousands of locations. And plumbing professionals can increase services offered and monitor and mitigate leak concerns of their customers.
Phyn will be a standalone company
This is a partnership between two companies, leaders in their respective fields. Phyn will be a standalone company featuring Belkin’s proprietary water-sensing technologies, expertise in data science and the Internet of Things (IoT) and will also offer agile product design, consumer insights and a global retail channel. Uponor will bring its leading position in plumbing expertise, professional insights from the trades and a global wholesale distribution channel.
“With years of research, technological advancements and field trials under our belt, we’re excited to partner with Uponor to help accelerate the mass scale commercialization of this technology,” said Ryan Kim, former vice president of engineering at Belkin and CEO of Phyn. “With our rich background in consumer IoT, sensor and machine learning, coupled with Uponor’s expertise in water delivery infrastructure, our dedicated team is ideally positioned to scale and deploy an intelligent water solution that sets a new bar for reliability, accuracy and intuitive user experience right out of the gate.”
The joint venture is perfectly aligned with Uponor’s strategy of growth in the emerging IoT market and represents a major step in digitalization for us, said Uponor Corp. President and CEO Jyri Luomakoski. “For Uponor, Belkin is a leading global partner in water-sensing technology, and our joint target is to develop unique new products for the intelligent water market, which is gradually emerging in step with the development of new, affordable and user-friendly digital technology.”
He added, “This investment and our partnership with a leading IoT company significantly accelerates our efforts to make plumbing systems more intelligent.”
Uponor and Belkin have agreed to establish two joint venture companies. The first one will operate in the U.S. and the second one in Europe, at a later stage.
Uponor will initially invest $15 million in exchange of a 37.5% shareholding in the companies. The investment will impact Uponor’s cash flow in the second quarter 2016, but it has no impact on Uponor’s profit guidance for 2016. As a minority-owned business, the joint venture company will be consolidated into Uponor’s financial accounts using the equity method. The parties have also agreed on a time frame within which Uponor has an option to invest an additional $10 million and increase its shareholding in Phyn to 50%.
Belkin International will initially own 62.5% of the partnership. Belkin will transfer its related technology, intellectual property, staff, and other non-monetary assets to Phyn. The U.S. joint venture company will be headquartered in the Los Angeles area with a research and development lab in Seattle. A number of Belkin engineers will transition to the new Phyn team. No timetable has been set for the first product launch.