Micronics CEO Karen Sorber: Networking is the most important thing you can do.

In the 12 years Karen Sorber worked on growing Micronic Technologies to this point – a $3 million funding round — she was nicknamed “tornado lady.”

In endless meetings and pitches, she honed the description of the company’s technology to a single memorable phrase: tornado in bottle.

Sorber, a long-time government executive, married a scientist, Kelly Rock, in 2008. He had an idea for a technology that would use a mechanical process, not chemicals, to purify contaminated water. This technology concentrates very polluted water, like you’d find in a landfill, or coming out of an industrial plant, so that it’s easier and cheaper to dispose of.  

“It’s taking the tornado process and bottling it,” Sorber told everyone, as she raised more than $6 million in grant funding from clean tech competitions and government programs to develop the product and find a market.

On Wednesday, the company, based in Southwest Virginia, will announce a $3 million seed round, led by Virginia’s Center for Innovative Technology and The Pearl Fund with participation from CAV Angels.

Micronic is the kind of rare company that is seen as critically important and a possible model for future development. It’s a DeepTech company, led by a woman, emerging from a tiny university on the front lines of one of the biggest economic transformations in the United States, as Appalachia and the country’s energy infrastructure move away from coal.

Micronics also received its investment round from national investors enabled by Opportunity Zones tax credits that were created to help economic development in distressed communities.

“Karen is really determined and persistent,” said Brian Phillips, who founded The Pearl Fund, itself a rarity. Opportunity Fund tax credits enable wealthy investors to invest their gains in real estate and ventures in distressed communities, getting tax deferrals and some tax exclusions. Gains on investments in the Zones are tax-free if held for 10 years. So far, the credits have mainly been used by real estate investors. The $10 million Pearl Fund — which will raise a new fund every year because of the structure of the tax benefits — is investing in ventures.

Phillips said he was inspired to establish the fund by seeing the power of venture investing to create economic development. “I’ve seen this all over the world,” said Phillips, a serial tech entrepreneur who has also worked in emerging markets, including with Goldman Sachs’ 10,000 Women Initiative. “It’s my calling to open to the first OZ fund that’s not real estate. We’re good deal flow in high-potential early stage companies that are not located where other venture capitalists tend to congregate.”

The Water Problem

Sorber’s journey started when, in 2007, she went on a humanitarian visit to Peru. She saw the lack of clean water. “I wanted to do something about it.”

One in three people do not have access to clean drinking water, according to the World Health Organization. Yet, 80% of water used in industries today is not reused, again according to the United Nations.

A year after that trip, she reconnected with Rock, whom she’d known years before. “The fire got lit, and the rest is history,” she said with a laugh. “We got married in less than six months. Kismet.”

With dozens of patents in his name, he had an idea for the device that could help in water purification. In the early years, they funded the company themselves and through investments from friends and family. She kept working full time at the Commission on Wartime Contracting in Iraq and Afghanistan.

She went full-time at Micronic in 2011, eventually putting more than half her retirement savings into the company. “Every time we needed 10,000 or $15,000, I put it in,” she said.

Private investors “slammed doors in our faces,” she said.

Finally, in 2014, the company received another grant, this one a hefty $2 million. Co-sponsored by University of Virginia Wise, it came with a condition: that she and her husband move, along with the company, to Southwest Virginia, about a six-hour drive from the northern part of the state, where she lived.

“Micronic’s move into SWVA presented a significant opportunity to the region to support the growth of a unique technology-based operation,” said Donna P. Henry, UVA Wise chancellor, who is on the company’s advisory board, by email. “This was a model for how local government, higher education and a high-growth company can work together to benefit a region. UVA Wise will always work hard to promote our region and to improve economic prosperity of southwest Virginia.”

Sorber and her husband moved to a “dream house on a lake,” she said, continuing to work on the product. Eventually, they identified sales distribution channels such as the architects and consultants that work on clean water systems installed at big companies.

Micronic’s system puts bad water and air come into a chamber that is geometrically formed to create a tornado. Clean water comes out one way; dirty water comes out the other in the form of a mist, and then contaminants are more easily removed, Sorber explained.

Though it all, “I did a lot of networking,” she said. “That’s the most important thing you can do. I would show up to someplace and they would say, ‘There’s the tornado lady.’ That’s how they remembered me.”

The Water Problem

In the highly politicized environment, Opportunity Zones have received a spate of negative coverage, as developers used the grants to move forward in rapidly gentrifying areas that arguably would have received investments in any case.

But on a slower track, some projects have been emerging in distressed areas. Southwest Virginia – coal country and part of Appalachia – includes some Opportunity Zones. Sorber was invited to present Micronic at a gathering of investors, including Phillips.

The deal was appealing not only because of Sorber’s ability to steer around obstacles, but because she’d raised so much of the company’s early funding without giving away equity.

The product is being validated now by the EPA in a facility in Cincinnati. Presuming that it goes well – there’s no reason it won’t, Sorber said – “we have our first sale in the cheese industry.”

She is projecting sales of $20 million for the company, which currently has six employees, in the first five years.

There are other applications for Micronic’s technology, including portable water cleansers for areas where water is contaminated – like Peru. She’s straightforward about what kept her going for these years. “I had a huge amount of money in the company and I knew the technology was really strong. I would not give up. I don’t fail and I don’t give up,” she said. “And my husband is a brilliant man. This technology is a genius technology.”

This story and others on New Builders Dispatch are made possible by a sponsorship from the Ewing Marion Kauffman Foundation. The Ewing Marion Kauffman Foundation is a private, nonpartisan foundation that provides access to opportunities that help people achieve financial stability, upward mobility, and economic prosperity – regardless of race, gender, or geography. The Kansas City, Mo.-based foundation uses its grantmaking, research, programs, and initiatives to support the start and growth of new businesses, a more prepared workforce, and stronger communities. For more information, visit www.kauffman.org and connect with www.twitter.com/kauffmanfdn and www.facebook.com/kauffmanfdn.