Stop feeling thirsty by helping others

Yaqua

3. Good Health and Well-Being 6. Clean Water and Sanitation

Overview

Innovation is not only about technology; it is also about rethinking the way of doing business. All in all, Yaqua’s innovative solution relies on its capability of reinvesting 100% of its net income in funding clean water projects in rural or remote communities in Peru, and Yaqua accomplishes this by selling bottled water.

Author

Katherine Macuri

Katherine Macuri

School

York University- Schulich School of Business

York University- Schulich School of Business

Professor

Charles Cho

Charles Cho

Innovation

Yaqua provides access to clean water to Peruvian communities in extreme poverty that are not part of the short- or long-term government public policies. Yaqua is the only one selling bottled water on the market, capable of generating a social impact - which means that consumers could easily become agents of change by purchasing an essential and low-cost beverage. Since 2013, Yaqua has been able to compete with giants like PepsiCo and Coca-Cola by offering its consumers the opportunity of changing lives while quenching their thirst.

Yaqua's success comes from developing an innovative organizational support business model focused on empowering the brand of 'Yaqua' - a word from the native Quechua language; but internally organized as two autonomous institutions: an NGO in charge of looking for impactful clean water projects and a corporate company in charge of managing the business.

This way, the corporate company oversees maximizing net income – considering their sustainability principles and efficiencies. The NGO is in charge of selecting the best and most impactful clean water projects, wisely using the donations received, and reporting the project’s impact, both organizations under the Yaqua’s brand.

Stop feeling thirsty by helping others

Inspiration

The idea was born in 2013 when Fernando Tamayo - a recently graduated MBA student - came back from Australia to Peru with the idea of generating an impact on its homeland. Back then, he knew that access to clean water was a major issue in Peru, so he decided to build a relevant network that could enable him to create a successful business model. That is how he connected with Scott Harrison, founder of Charity Water. At that meeting, Harrison told Fernando that "the problem in South America is different from that of Africa. As Africa does not have enough resources to solve this problem [access to clean water], South America has the resource [water]. The problem is social inequality. Some have more than they need, while others do not have the most basic access." At that time, Luis Chavez, current Director at Yaqua, recalls the latest statistical Peruvian report that surprised him last December. He said, “It is unbelievable how the numbers have not significantly dropped in the past eight years. We still have 7 million people in Peru that do not have adequate and affordable access to clean water.”

Overall impact

Overall, Yaqua has reinvested 560,000 Soles – or 148,000 American dollars – in financing clean water projects in rural or remote areas of Peru like Amazonas, Ayacucho, Cajamarca, Huancavelica, and Loreto during the past eight years. Its entire portfolio of social projects has facilitated access to clean water for more than 1,600 people in extreme poverty.

It is worth mentioning that providing access to clean water improves people’s health and overall well-being. Scientists have proved that access to clean drinking water decreases the mortality rate, increases the opportunity of performing better at school, and also assists in finding a job.

Moreover, the communities that benefit from its social projects are in remote areas where people must walk 4 kilometers to obtain necessarily not clean water. If we consider the amount of time invested in just walking those long distances, the overall impact of Yaqua will increase radically; since that time represents the opportunity cost of doing other economic activities that could improve the community’s quality of life.

Business benefit

Because Fernando decided to build a business focused on solving relevant social issues - access to clean water and reducing social inequality; he has been able to develop great alliances in the corporate environment. This way, Yaqua has established valuable contracts with suppliers that want to be part of its impact. Thus, Yaqua has reduced its cost structure by benefiting from other companies’ economies of scale, enabling it to guarantee high levels of net profit, reinvested in providing access to clean water across the country.

Essentially this has become a reality because of Fernando’s constant efforts to build a social, reliable, and impactful brand in a market dominated by transnational companies. Nowadays, Yaqua is the only solitary brand on the Peruvian bottled water market. Luis has the enormous challenge of increasing its impact by amplifying Yaqua’s portfolio of products and increasing the members of its social community.

Social and environmental benefit

When the world is currently facing the consequences of the pandemic, the importance of access to clean water has risen. Also, that clean water protects us if we adopt good habits like cleaning our hands regularly. Imagine living in a place where you cannot access a resource by walking a few meters. Therefore, when analyzing Yaqua’s benefit to society, we must consider a multiplier effect between access to clean water, health, education, and the community’s quality of life.

Moreover, Yaqua’s management team is conscious that its long-term success will demand continuous innovation. Consequently, they are currently working on diversifying their offer, which will reduce the risk of relying on a unique product (bottled water). While incorporating eco-friendly resources instead of plastic or even not selling any other at all since Yaqua will prioritize creating a committed social community.

Interview

Luis Chávez Cabello, Director

Photo of interviewee

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Yaqua

Yaqua

Lima, Lima, PE

Business Website: https://www.yaqua.pe

Year Founded: 2013

Number of Employees: 2 to 10

'Yaqua'- a Peruvian social enterprise founded in 2013, has an innovative social business model that aims to transform the bottled water industry by converting its consumers into agents of change. If you buy one bottle of Yaqua, you will provide eight days of clean water to one person in extreme poverty.