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FreeWater is an Austin-based for-profit company that offers all of its water products for free through advertising. (Free Water/Instagram)

Austin-based company FreeWater is doing just what its name implies—it's the first packaged beverage company to be completely free to customers.

But there must be a catch, right?

While passing out waters to runners on Austin streets, families and other Austinites initially were skeptical about the brand, but they universally seemed to accept the money-saving, philanthropic ideals embodied by the new startup, FreeWater has said. Founded earlier this year, the company has already appeared on multiple news sites and has millions of views on its TikTok account.

Instead of charging for each bottle, FreeWater's business relies on advertising on its bottles to make its profits. More of a marketing channel than a product-based business, the startup offers B2B plans that sell bottles to businesses that can either hand out water or choose to have customers pay, or B2C distribution which directly gives bottles to customers for free.

"FreeWater aims to be a positive and prominent advertising channel that doesn't annoy or harass its audience," the company said in a press release. "Instead, they want to make people happy by saving them money, saving lives and helping the environment."

Philanthropic in nature, the company also donates 10 cents made from each bottle to Austin-based charity WellAware, which works to build water wells for people in need in East Africa.

Additionally, each bottle is made with recyclable materials including aluminum, and the company hopes to be totally carbon neutral by 2025.

As a marketing platform, FreeWater offers an interactive advertisement model that can include QR codes and other means of interacting with customers. According to an Associated Press article in May, the bottles receive 10 times the engagement of direct mail advertisements. FreeWater said its current valuation is $5 million as of October 2021.

While the company awaits support from major advertisers, it works to target famous brands and influencers Elon Musk through its growing social media following and handing out the products at popular Austin hotspots.

According to FreeWater's website, the company is on track to distribute 50,000 bottles by the end of 2021 and hopes to send out 1 million through 2022 as it places three vending machines around Austin early next year.

But founder Joshua Cliffords, who came up with the idea while learning about water insecurity issues from refugees, said water is just the start for the revolutionary company. Eventually, it hopes to create a free supermarket, other free beverages and a free "Amazon 2.0" that would enable the "free and profitable distribution of nearly every type of product that can be purchased in COSTCO today," including "food & beverages, clothing, medicine, computers, transportation, and travel."

While it has a small footprint now, expect to see more of FreeWater in the future as it hands out 20,000 of its free bottles at its media launch at the 2022 SXSW festival.

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