Great to chat with Ted Power, Co-Founder at Bend! Bend tracks CO2 emissions by company spend! We discussed CO2 estimates, the growth of companies with climate commitments in the last few years, how to define net zero and more!

https://carbotnic.com/bend

Reach Ted: tedpower@bend.green

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James

The unedited podcast transcript is below

James McWalter

Today is speaking with Ted Power Power cofounder at Bend welcome to podcast dead. Cheers! I supposed to start what is bend.

Ted Power 

Um, hey James great to be here. Thanks for having me. Yeah, so Bend is a carbon spend-based tool. We have really two use cases. one is we help small businesses with one click measure. Their carbon footprint and the way that works is we pull in. All of their spend data and um are able to create ah a company profile based purely on that spend data with merchant specificity factors. Um, and then we help those companies in a very sort of lightweight way plot a path to net zero and then. Figuring out how to talk about it with their customers. Um, so that’s one piece and it’s quite a bit more you know automated and you know, frankly, cheaper than some of the um you know more advanced ah sort of more enterprise carbon accounting tools out there. Um, you know our our sort of thesis is that there are. 99% of companies that are doing essentially no um, you know, thinking about their carbon footprint. We want to make it really easy for them to get started so that’s one focus and then the second focus is we make all of that data available via Api so that fintech companies and um. You know companies that have this spend data can actually embed climate information directly into their products and part of the idea there is that you know not every company wants to have a separate carbon accounting tool off to the side of all of the other tools that they’re already using to run their business and so we make it possible for. You know fintech companies expense management companies. Um, you know vendor management companies to embed ah carbon accounting little sort of widgets in in their existing products. Um all available v api um, yeah, so that’s what we’re building.

James McWalter

Super cool and and we’d love to kind of dig into each of those in turn. Um, but I guess before we do that. What drove the initial decision to start bend.

Ted Power

Yeah, so my cofounder and I um Thomas prior to Ben were working at an expense management company that I co-founded in 2014 called Abacus and um at Abacus we you know we built this thing where companies could. Track their spend. You could get reimbursed for your you know Starbucks coffee or your you know Jetblue flight or your Aws bill. Um, and we built that company. We sold it in None to a company called emburse that is the None largest spend management company in the us after concur. And um, you know one of the things that we heard from our customers increasingly over the last couple years is that you know our customers and which included like you know the bill and Melinda Gates Foundation and bosh and Exxon and others or big companies. Um, they were saying like hey you’ve got all of our spend data. Ah, could you please help us understand our carbon footprint. Um, if you think about it. It sort of makes sense in this you know from the perspective of all of that spend you know the business travel the marketing spend the cloud spend for many companies is the primary source of emissions. Um. And um, you know, being able to offer kind of real-time insights into um you know all of the things that your your company is spending money on and where there might be opportunities to reduce your emissions and particularly your scope 3 goods and services emissions. Um. Seemed like a useful thing to just sort of embed in um, in spend management and so we set out with Ben to build essentially that translation layer of you know dollars or or currency to co 2.

James McWalter

That’s interesting and it’s always very helpful to have heard about the problem. Yeah, from multiple years from like you know large organizations like you mentioned and that really helps kind of validate. You know that that kind of early kind of customer validation Process. So. Yeah, once you got to I guess decided to move forward and and start a new company with this particular focus. What was your kind of None You know the first couple of months like.

Ted Power

Yeah, so um, Thomas and I started working on ben really at the beginning of this year so it’s only been six months or so um, you know the the um, the None thing we did was we started to? um, yeah, talk to a bunch of people. And then also um, start aggregating corporate emissions data which is kind of the foundation of the way you know the way it all works and so as you may know um, most. Large companies now publish annual sustainability reports with their full greenhouse gas inventory data and so this is something that you know even a couple years ago the number of companies that were participating here was.

Ted Power

Was pretty small and and you know maybe not to a sort of a critical mass where what we what we’re doing today would have actually been possible but now over 70% of fortune None companies publish um their greenhouse gas inventory data and you know that number is growing exponentially. Um, and so it really made it possible to start to have much more granular. Ah merchant specificific data still using the sort of the spend approach. You know it used to be sort of traditional carbon accounting is the data was so poor that every time you wanted to address it. You pretty much had to do sort of bottoms up analysis of like. You know we don’t really know much about you know jetblus emissions or whatever so we’re going to create a model for air travel or we’re going to create a model for you know cloud or whatever. Um, and do a you know bunch of very manual sort of calculations and we probably do about once a year and you know takes a lot of time. Um, and our approach at Bend is we take you know instead this um greenhouse gas inventory data and we use that to create emissions factors per merchant and so you know let’s say you know Starbucks for example, publishes their annual sustainability report. Um. We take their full greenhouse gas inventory data which is scope one through scope 3 all of their data. Um, and that’s the total emissions and then we you know the the denominator what we divide that by is their total revenue and so the formula is basically your you know $7 starbucks.

James McWalter

I Sure these days. Yeah.

Ted Power

Maybe you know $10 Starbucks with inflation these days. Ah you know, multiplied by um, Starbucks’s total emissions divided by their total revenue equals. Essentially your share of emissions or basically um, you know your your scope 3 emissions. Um. And so that’s the formula. Um, and we um so like we hand download all of these ah Pdf sustainability reports and they’re like you know None page reports and on page you know 99 there’s like a table and so we you know pull in all those values. Um. And of course not every company yet publishes this data and so in the cases where we don’t have good merchant Specificific Data we have category fallbacks and so companies are still able to get None coverage but just with various. Degrees of confidence based on whether or not we have good merchant specific data or just sort of you know category benchmarks. Um, and um, yeah, and so you know at the beginning of the year we started building out that whole process. Um. You know and then you know once we had that sort of engine working you know more recently the focus has been on making it really easy for companies to either embed this data or to connect their bank account and um and get a climate report in a matter of you know 30 seconds and so that’s sort of the focus now.

James McWalter

Yeah, and I guess in terms of that like that initial Mvp to be able to connect your bank account. Get a cla forden I can vouch that I actually did try this with with Ted and Ben about a month or so ago now where I set up our company credit card at my own startup. We use. Credit card called Brex? Um I think like the nature of any Mvp there was on my side. Actually it felt pretty smooth but it sounds like when we we discussed recently that there was kind of a lot of different kind of moving parts but I was able to kind of get in see our total spend and as. You probably expect what a kind of small startup that has done a fair amount of travel recently you know it very very heavily weighed towards you know our delta airlines last Airlines Jetblue Airlines kind of emissions and as that in terms of our spend is definitely the most and it actually yeah from a gut check point of view. It actually fit. Pretty much what I would have expected.

Ted Power

Yeah, no, totally. That’s um, that is um, what we see often with particularly with um you know software startups or professional services type companies where their emissions you know primarily are in. Um, 2 categories None one is airfare as you as you would imagine the other being cloud you know hosting and things like that and ad campaigns. Um, actually you know one of the sort of surprising and things is that that there’s a pretty significant. You know we all think about cloud ah you know sort of. Aws or Google cloud or whatever as being a big emitter which it is um but also Adwords and you know ad spend um also is actually a pretty big um source of emission. So so marketing spend. Um, yeah and I think you know one of the things that’s really important to us is that it. It’s actually. Ah, merchant-specific. So um, you know I think the top line sort of takeaway is that you know airfares is ah is a quite carbon-intensive. Um, you know, endeavor you know that’s probably where where most companies should start and you know we should be sort of thoughtful about. You know when it’s worth getting on airplanes and that sort of thing. Um, but also you know one of the things that’s cool about the merchant-based approach is that you can think about the relative emissions. Um for different merchants and so you know all things being equal. Um, you know if you’re going to take a flight and of course we all need to get on airplanes from time to time. Um, you know there are ways to reduce emissions even you know within within that sort of frame of like you know, certain airlines? um are taking climate more seriously. Um, and you know booking. Direct flights and and you know thinking about even the you know the make and model of the aircraft and things like that and so you know one of the things that we’re trying to sort of peel back the layers on it. Bend is helping companies sort of you know, think about that next level of like. You know for startups spend less money in and of itself is not really a viable strategy. You know like companies have to spend money. Um, and so one of the highest leverage things that companies can do is that when they do spend money they can think about ways to spend with.

James McWalter

Okay.

Ted Power

Lower carbon intensive vendors. You know, sort of like look at sort of alternative vendors. Um, and that’s one of the things that we’re really focused on trying to encourage have been.

James McWalter

So yeah, so so kind of building out nearly a recommendation engine that states. Okay, ah yeah, and and you know because it’s I guess it’s early just still a lot of data collection around kind of how users are using the product but you know eventually you could have something like yeah for us. You know we’ve Delta Alaskan Jetlue is our top 3 airlines and fors sakee argument and ah, pretty much all and all those flights for us are New York to sf and back like that’s pretty much the the route we do and so it’s like okay, consistently Alaska is better. Best and I have no idea which one is best but let’s have sake of argument. It is Alaska. Um.

Ted Power

Um, yeah, yes, well.

James McWalter

You know that at the margin. Ah, you know you could set up a recommendation engine and say hey, um, maybe you know not only look at Laska but that might be the best place to even do things like your air miles program for your company and just start to have those little nudges that. At to margin get people to take more kind of climate. Friendly decision.

Ted Power

Yeah, that’s it I mean that’s kind of it in a nutshell I think those like little nudges are powerful. Um as as a way to just sort of like iteratively make progress and so yeah, we’re all about the little nudges. Um, yeah and I think that’s um.

James McWalter

And so going back into the data for these kind of large companies who have made the kind of climate commitments and it’s funny. Yeah, as you’re talking I was thinking back to when I was None starting to look at century started climate company. This is a yeah summer of 2020 yeah

Ted Power

That’s a good way to think about it.

James McWalter

And deep in the early days of covid and at the time I remember like trying to figure out how many because I was mostly looking at the food space at the time I was like trying to figure out like how many of the large you know the fortune 500 companies have made climate commitments and at that point there was maybe a dozen food companies and literally when in four or five months

James McWalter

It was like 50 and and it was just kind of remarkable how fast the growth and it went from literally like it was just like these are the None companies and the dozen companies who have made a commitment to it being you know, basically ah, kind of table stakes for any sort of company and with recent kind of scc movements. It’s becoming more and more. It’s not quite mandatory and in the way we’d all like it. But it’s it’s kind of trending in that direction and so I guess as you kind of think about because it isn’t ah you know, structured in exactly the same way you have all these kind of varying reports. How do you I guess kind of compare apples to apples when you’re trying to assess these companies.

Ted Power

Yeah I mean that’s the that’s the like million dollar question um and something I think we’re all collectively you know trying to grapple with um, you know we so we do some things today and it’s something that we um, you know I’m sure will continue to evolve. Um. But you know none of all companies need to use the greenhouse gas protocol to report their emissions so we won’t include um any companies that don’t share full greenhouse gas protocol data. You know some companies are are you know, like historically companies would be fairly selective where they would report like scope one and scope 2 and then business travel but like ignore all the other categories of scope 3 and and for us. Um, you know it’s really important that it needs to include your sort of full at least your full kind of. Upstream emissions. Um, you know impact because without that it’s not really apples to apples and um and there’s so much emissions in that in that sort of scope 3 category. That’s really important. Um, so that’s the none thing is that you know we we only um, you know. Pull in data when when it’s reasonably complete. Um the other piece of it is compensation or or you know carbon credits or offsets and that whole sort of thing which which um, you know is certainly ah um, a big topic unto itself and you know and None of the things that we’re doing there because the. Quality of some carbon removal or you know Avoidance Offset claims are um, you know a little squishy at best um is we give first of all, we won’t um, we won’t pull in ah you know, very dubious ah carbon removal. Um, you know claims or offset information. We really prefer to have the actual like project Ids and all the information about the projects that companies are investing in and then we also give our customers the ah the option of choosing either the um compensated. Ah, emissions factors or the uncompensated emissions factors but which I mean like um, you know for example, take salesforce um, you know salesforce um is doing a ton of really great stuff and we’re huge fans of salesforce um, and they are actually they claim to be ah carbon. Neutral I think they would even describe it as.

Ted Power

Net zero the sort of definition is more a little squishy. Um, and um and that’s based off of you know purchasing you know a significant amount of ah carbon credits and so you know if if you’re you know, sort of you want to give salesforce credit for that fully compensated. Um. You know Aissions factor where basically every dollar spent with salesforce has a 0 and you know zero kilograms of cotwo because they’re ah a net 0 business then you can do that or if you want to take a little bit of a sort of a stricter stance and say you know I’m not so sure about these sort of. You know avoidance carbon credits in general. Um, then you can choose to only take the emissions side of the equation for salesforce and and not sort of you know, try to bake in the offset projects or or other things that they’re investing in.

James McWalter

What’s powerful about that is you know the development of different levers that pushes companies into better directions because I salesforce and Microsoft and a few other companies have done a really good job. You know in particular funding. Um. You know, various carbon credits initiatives, forestry etc and that’s great and and definitely needed but those companies also have the kind of longer term aim to be actually net None right from their actual operations and. Could be a combination of them producing renewable energy completely redoing their operations. None classic example, you know Microsoft and and salesforce I’m sure as well have large server farms. Um, yeah, moving those to renewable energy kind of changing how they’re constructed all those things that are way way more difficult than just you much us. But. Purchasing carbon credits of various types. Um, so I really like this kind of you know, dual approach to the you know adding leverage factors to get large companies to see. Okay, how are people kind of voting. How are they assessing? Um, yeah, how good any individual company is doing on these metrics. But.

Ted Power

Yeah, totally and and you know we’re we’re big fans of um I think it’s Lucas Jopa I’m not sure if I’m saying saying his name right? But the head of sustainability at Microsoft and he has a ah way of framing this as like we need to debug net 0 claims. Um, and obviously as engineers. We love the sort of debug metaphor and so we like we literally and it’s still you know early days on this but the way we imagine this working and we have a little sort of prototype of this on our if you go to http://ben.green and click on the Microsoft um, ah profile. For example.

Ted Power

We have a little like you know, ah we imagine it will look very much like a like a debug console like you know in the same way that if you um, commit some code you run it through a series of um checks and it will sort of spit out any sort of errors. Um, and in that same Sense. You know when companies publish their. Greenhouse Gas Inventory Data. We’d like we’d run it through a series of checks and sort of say well you know some of these carbon credits are a little questionable or sort of you know ranked fairly low quality or you know the way this company’s defining. Their boundary is suspicious or you know things like that um all sort of you know. You know, maybe sort of contributing to like a credibility score or something like that. Um, as a way to further kind of refine. Um, you know how how these sort of merchants or or companies are um, you know getting you know appropriately sort of rewarded for the you know the sort of investments that they’re making um. And like another example of that is um, one of our early customers this this task management ah company called dart which is another Yc company um is using um as using Band and one of the things that we’re working on with them is you know. If they go net zero um by and investing in you know, really high quality carbon removal which which frankly startups can afford to do because um you know that they’re their sort of their footprints tend to be so Modest. Um, then we can basically position them to your point earlier as a as a. Low carbon alternative to their competitors. So like you know and and we can sort of list them in a directory of of companies that you know are are you know, lower carbon intensity or even net zero. Um, and so I think that’s a way to sort of reward companies that are you know quote unquote doing it right? and then. Essentially creating ah a market for um, you know bigger companies that are searching for vendors um a way to actually you know fairly quickly filter for companies that are sort of taking climate. Seriously.

James McWalter

Yeah, it’s really Interesting. You know we we talked in the past in the podcast about how most of the incentives are for the largest companies in the world to actually decarbonize kind of strangely enough I think to the to the lay person relative to small companies because large companies have way larger. You know Larger Regulatoratory. Burdens Ah consumer. They’re more exposed or or they exposed them their kind of marketing to a larger kind of cohort or consumers who might be driven by some of these factors whereas you know a small supplier that’s sitting within the supply chain of a fortune revenue company often does not and so one of the things. Typically been seeing is this pressure from large companies to have smaller companies that affect their own scope three and scope 2 emissions to decarbonize and so what I think is really kind of clever about what you’re just saying there is you know that that pressure exists but you can also give the smart companies. You know, getting out ahead from a competitive point of view of their competitors as they try to be you know merchants and vendors to larger companies and and actually put it back into the power of smaller companies to make those decisions in ways that yeah historically is quite difficult to do.

Ted Power

Yeah that’s that’s the dream. Um, and we are like we could not be bigger cheerleaders for exactly that. Um, you know and big shout out to um Patrick Flynn and the salesforce team for I think you know being one of the early companies leading the way here. Where they’ve basically said that None of their suppliers need to measure emissions and um and set production targets and that is just ah is such a powerful sort of you know? um. You know point of leverage to really scale this stuff up. Walmart’s actually done a bunch of great stuff here. There’s a few companies that are really sort of moving us forward there? Um, and you know so if you know for any big companies. You know, maybe listening to this podcast. Um, you know, please make similar supplier pledges. Ah because. Frankly, it costs you nothing. It might even save you money and um, it’s incredibly powerful. Um, but yeah I mean we we are big fans of startups and small businesses and we think that they have um, a lot of ah, a lot of you know lot of leverage a lot to contribute in this space I think that you know historically. Um, as exactly as you said it’s been perceived. This is kind of like a enterprise company sort of public company game. You know they’ve got they’ve got the resources to you know, build out sustainability teams and you know maybe they’re in sort of natural monopolies or things like that plus they you know they’ve got they want to. Be listed in yeah esg funds or you know other sort of ah you know financial sort of public company type. You know, regulate regulations or incentives. Um, but our belief is actually that um you know small businesses have in some ways a leg up over the big companies. Um, you know it’s just been too expensive for them to get started. You know if it costs $100000 to build out a climate program then small businesses can’t do it but you know the advantages that small businesses have is they don’t have the you know the huge sunk cost of you know. Capital investment. You know, big offices, big facilities. You know, big outside sales teams that are flying all over the place. Um, you know startups tend to be pretty lean, pretty pretty nimble particularly post covid where you know I think there have been whole. You know. You know vintages of startups that are sort of remote none or hybrid and you know you know sort of working more on Zoom and and that sort of thing and um, you know so these companies are super well positioned to credibly um you know.

Ted Power

Reduce their emissions a heck of a lot and perhaps even go all the way to net zero which should be a competitive advantage against the sort of you know they’re they’re bigger incumbents who um will have a harder time I think decarbonizing.

James McWalter

Yeah, and you mentioned darsh is yc company. Obviously we met through y combinator for the audience both you know Ted and I are in the summer and but both of our companies I should say are in the Summer Twenty Two Y Combinator batch um with few none others. Maybe not as many climate companies as as I would have liked to kind of go into it or i’ have preferred but know I guess you know so touching on that. Um you know one of the kind of real the I’d say powerful parts of at least my experience of yc is how much focus they have on really understanding the customer and. You know, basically asking them to pay you. You know, getting really figuring out your funnel and you know moving a customer from you know oh that sounds interesting to actually being someone who’s a user a happy user and a paying user and so. I think having that kind of strategy around startups I mean is this classic kind of wicy thing if you can sell to Otherwisey companies when you’re in the match. That’s often a good kind of way to leverage early kind of customer interest and so yeah I guess how how have you found yc and um, you know how you’ve kind of taken that advice and applied it to bend.

Ted Power

Um, yeah I mean I think that’s the the power of Yc is really the the community. Um and and so um, so this is actually our none time through YCombinator we did y c. Back in None with um with this company called Abacus which is ah this expense management company I was talking about earlier and um and so abacus was ah also a sort of ah a businessto business expense management tool. You know we helped companies. Manage their spend and get reimbursed for spend um and and like our first I don’t know you know I’d say like 80% of our None customers were probablyyc customers. Um, and um, and so certainly that um, that. You know that network of founders who are you know in many cases willing to try each other’s products and and um and you know provide good feedback has been incredibly valuable to us and you know I think it’s um, certainly was then and it seems to be this time around as well.

James McWalter

I and as was speaking to dance. What are the kind of goals of the next few months I mean there’s demoday goals. You don’t have to share those those are you’re often. Ah very evolving and and closely held in our case as well. But yeah I guess like what? what? what are some targets. You’d love to get to you know over the next. Yeah few months.

Ted Power

I have.

Ted Power

Yeah I mean I think um, you know we’re we’re trying to build something that you know companies want so we we want. Um, we want more people using bend basically and um and you know giving us feedback and making sure that we’re um, onto something here. Um, and so. You know our goals are basically um, you know the the sort of None focus areas. We werere talking about earlier. Um one is if you work at a startup or a small company and you want to try out bend. Um, you know we’re where we would love for you to try out end and um. You know it’s a free trial a two week free trial so you can decide if it. Ah if it works for you and and um and beyond that it’s only a hundred bucks a month so quite a bit less than um, you know, many of the other pretty much all of the other carbon accounting like so you know enterprise carbon accounting tools on the market. Um, so that’d be the None thing and then um, you know the other focus is we’re having lots of conversations with um you know companies that issue corporate cards companies that um, you know like accounting companies spend management companies vendor management companies about. Ah, embedding um bend in their products and so that’s that’s sort of the other kind of more of a Api focused kind of um, you know thing that we’re we are focused on.

James McWalter

Yeah, like we didn’t really kind of touch on that in depth. So let’s get into that piece because that’s actually new to me as well from when I first started talking to Ted a couple couple months like a month or so ago and so yeah, so you know I guess this really kind of goes to that early insight when you were working on Abacus. Um, and so would a company like abacus be kind of an ideal client in that direction.

Ted Power

Yeah, abacus um, aca we be an amazing customer and and emburse that was the acquire of Abacus or you know or concur or um, you know, ah you know Brex or you know we’d even we’d even like plaid um which is a. Card data aggregator you know, eventually we we would love for this data to just be. You know, returned in the same way that they return you know a transaction with you know, an amount and a merchant and a date you know? Ultimately we think that? um ah you know cotwo should be returned on every transaction. Um. And you know I think that’s that’s the like big idea is that literally every transaction every receipt um has this sort of carbon layered on top. So that you can start to make more informed decisions and and just sort of take that into account. You know I think like. Sort of like econ one on one I remember you know from from ah freshman ah college was all about this notion of or you know, big big surf concept around negative externalities and you know the you know tragedy of the commons and things like that and um, you know one of the things that we’re just. We’re trying to do with bend is take those negative externalities and just sort of reflect them or price them in or you know represent them so that you can um you know start to you know, make better decisions.

James McWalter

And when I guess you know relatedly to this kind of idea of expense management. There is sometimes you’ll go on to a webpage. You’ll go on to you know Google flights and you’ll sometimes see the CO 2 equivalents and sometimes you’ll see that opportunity to click offset and so how do you think about.

Ted Power

Um, and.

James McWalter

You know the the bend carbon Api and how it kind of positions relative to that. Ah, you know that kind of already existing space.

Ted Power

Yeah, no, we love that I mean I think um we you know the more of that the better um I think um I yeah you know in the same way that yeah like a few merchants now will um, will include some cotwo data. Um we we want that to be almost expected you know and you know I think like you know, for example, stripe is ah is a company that is doing a ton of really awesome climate stuff. Um, and we’re you know we’re big fans of what they’re doing in the carbon removal world and so on. And they’ve got this great program which is um called stripe climate where vendors can say we’re going to donate 1% of our revenue to the climate. Um, and that’s cool and I think you know yeah, it’s it’s awesome when companies. Um do that? um. But um, you know, ultimately, you know we would like to at least you know in many cases let those same companies not just sort of offset a flat 1% but actually have visibility into like what are the actual um line items that are contributing the most to you know to our carbon footprint. And um, and you know perhaps in some cases. That’s you know, 2% and perhaps in some cases. It’s like half a percent of revenue or whatever but having it be more sort of emissions drivenve as opposed to you know flat one percentage of revenue driven seems like at least in many cases. A really important sort of signal. Um. And um, you know making it so that more and more transactions have that climate data embedded is is the goal.

James McWalter

Um, I mean we nearly want it to be. You know like the water that everyone like swims in right? It’s just like it’s it’s it’s part of the conversation. It’s part of the decision making at literally every node every layer of basically the the kind of global economy and so. I think one of the really interesting insights over the last couple of years is the you know like a product as is it as an Api right? like and having companies like stripe and very very large companies who have completely built hundred billion dollar companies based on being an api. Um, when so much of the world has gone to software. Ah yeah, the world of Apis is not going to get any smaller and so I think they’re getting that leverage point. So yeah, is it like ah yeah, it was literally 5 minutes before we jumped into the call I notice the kind of new direction I was like oh that’s that’s that’s actually pretty interesting because you know we’ve had patch on on the podcast in the past and a few other folks who’ve kind of gone in. So what’s some directions but you know not not never kind of focused on the revenue-based carbon piece and I think it can definitely be this kind of very high leverage piece of the kind of climate picture.

Ted Power

Yeah, no totally. And in fact, you know, um you mentioned patch. We’re actually ah we just rolled out an integration with patch. In fact, um, where. You know, sort of it and in hindsight it maybe was obvious but we we weren’t sort of focused on carbon and removal at all at at None we were just focused on sort of nailing the measurement piece and sort of you know, high credibility automated measurement but inevitably you know when when we started to onboard some companies. They’re like this is cool. You know thanks for the data. But um, it doesn’t feel very actionable because you know yeah we can you know figure out some places to cut some emissions but you know at the end of the day you know there are certain things that are going to be very difficult for us to decarbonize and um and so could you help us with um you know. Carbon removal and so in literally a week we built ah integration with patch. Um where you can and so you know speaking of Apis is kind of like you know Api Plus Api where we’re doing the calculation and they’re doing the you know the offsetting. Um, but. The net effect is that companies can off their you know their brex account or their bank account. Um, get their monthly. You know real-time c o two footprint and then if they want to, they can opt in for um, automatic offset purchasing and so like the billing is just like It’s like a saas product or something. It’s like every month you just pay your balance. Um, and um and one of the things that we’re testing and like you know if you’ve got feedback on this listeners. Please let us know um, is we’re we’re really trying to push for kind of moving the expectations around. Carbon removal cost and so our sort of pilot. We’re actually charging um a hundred dollars per metric ton of co 2 which is probably about 10 x frankly what like most companies pay for carbon credits. Um. And these are super high quality. It’s mostly charm industrial which is um, you know this? Ah I’m I’m not a I’m not a scientist but I’m you know bio oil putting oil back into the ground solution really smart um team and then some um you know some. US -based um, you know, really high quality. Um ah other offsets and um, you know and and that feels like if we can convince companies that that that’s um, you know feasible.

Ted Power

And that feels important to kind of move away from these like $5 even $2 you know per ton offsets which frankly, ah you know tend to not to be very credible. Um, so that’s that’s sort of the other piece of it is then like Auto Auto billing offsets to sort of you know you know. You know, get companies the rest of the way to to net zero if they want to or a percentage.

James McWalter

Yeah, the if the I guess the value of a carbon credit. It’s just kind of fascinating space. Um that that I’ll probably have a guest on to kind of go into the details ah of there a point. But absolutely think you know for the audience like if you think about. Basically a line going from the kind of low- qualityality credits that that Ted mentioned where it’s you know, basically forestry or land-based credits that people haven’t really done a lot of verification of all the way through to multiple hundred dollar credits which is literally sucking c o two out of the atmosphere and pumping it underground. And then you know, really strong companies like charm and you know fall within that kind of between those None kind of endpoints on the spectrum. So you have this kind of idea of like ah like and permanence is basically related to to to quality and then permanent sales related to price. So I actually ah agree. Ah you know, getting above this kind of 10 to $15 ton. Um often ceiling for a lot of carbon credit programs in companies I think is absolutely important and essential because those a couple of things. None of all, it’s a better carbon credit right? The the carbon actually has more permanence. It’s more verifiable. Um, but it also helps fund the r and d needed. For those companies to actually try to get their cost down right? because as they get more money to fund greater research as they start to sequester more carbon. Yeah, a direct or capture a company that’s literally charging 3 or $ 400 or more a ton today you know they’re still targeting getting down sub a hundred dollars a ton right? like that’s their own internal goal.

Ted Power

Um, right.

James McWalter

Um, and they need early customers and early yeah things like this to help and you you have companies that we’ve already talked about like stripe and Microsoft Shopify and salesforce who are helping actually be the None customers and and in ah in one sense. Yeah quote unquote overpay to kind of help develop that as an industry but I think if we can get. You know everything to be literally a click of a button um at the margin people starting to make more of a permanent space decision I think that will be you know positive for the carbon credit space. Overall.

Ted Power

Yeah, no totally agree and I think you know one of the things that stripe has been arguing I think they’ve got a point is that it’s actually more important to invest in the you know, super expensive ah engineered carbon removal. Um, then to try to sort of you know, meet your you know per ton. Um, you know footprint and so like their recommendation is figure out how much you would have paid for the um, you know the lower verifiable quality permanent. You know solutions. And then just take that you know same amount of money and put it towards the expensive stuff and like yeah you won’t get as many you know, sort of quote unquote none of carbon credits. But your dollars are better spent there because you’re helping bring those projects down the cost curve. Um, and um. You know, generally generally I’d agree I also you know the other benefit of a price on carbon is that it ah it creates real. Um, you know, sort of incentives around like. You know at at like $2 a ton you know probably doesn’t come into you know decision making much but at $100 a ton. You know that actually does start to um you know help companies sort of think about you know you know should we be purchasing these things or you know what are the what are the sort of opportunities to reduce our um. Our carbon intensity. Um, so so yeah we’ll see how it goes you know it’s it’s it’s an experiment but but we’re we’re excited about the I think the other thing that’s worth saying is that? Um, even at that super high price point. Um, most companies are surprised at how affordable. Um, you know super credible net zero can be at least the companies that we’re talking to which are you know tend to be sort of smaller startups. Um, you know? For example, um us at bend of course we use bend at bend and um. You know we’re a tiny startup we’re we’re 2 people. We don’t have an office we you know we buy a bunch of software. We. You know we occasionally um you know do a bit of travel. But you know I think last month our um, our co two ah footprint was like. I think it’s like fifteen kilograms or something like that. Um, which is ah or it do is like none but it’s like five bucks you know like even at $100 a ton. It’s it’s ah peanuts. So um, and of course that will that will certainly um grow but you know even still even.

James McWalter

Right.

Ted Power

Even larger like series a companies. It’s like you know, maybe a couple hundred bucks a month kind of thing and so in the scheme of things. It’s possible if you start early that it’s still actually quite affordable. Um, and I think that’s an important thing that um you know companies maybe don’t even want to look because they’re sort of worried what the yeah. The answers might be and you know you know one of the nice things about our free trial is you can sort of test it out and and get a feel for you know what? the actual cost might be for your company.

42:32.33

James McWalter

Yeah, absolutely and actually we should talk about. Ah yeah, Us pace my own startup being proper customer I actually did just quick bit of math based on your product and ah purchase credits from recool it. Ah, another friend of the show.

Ted Power

You’re cool. That’s awesome.

James McWalter

Who was hunted a couple a couple of months ago um and they’re they’re also very high quality credits. But now that you have to patch integration. So so yeah I won’t worked that for us about eighty ninety bucks a month ah to offset so and that’s for yeah, completely reasonable and.

Ted Power

Um, yeah.

James McWalter

I’ll see you know climate companies we should at a minimum be be doing that kind of thing. Um, cool well Ted this has been absolutely brilliant and really appreciated. Is there anything I should ask you about but did not.

Ted Power

We should do a We should totally do yeah.

Ted Power

No I mean I think we covered it. You know I think and I guess the last thing um you just say is that you know part of our job is that you know after companies measure their emissions and put a plan together then you know one of the things we try to do is help them. Um, you know. Tell that story. You know to investors to employees to um, you know to you know potential customers that are you know, increasingly asking about it so that sort of you know we also want to make sure that um that sort of that piece companies are getting supporTed Power with and um. Yeah I mean really appreciate you having me on. Um you know any any of your listeners that want to try out bend. Um, check it out at http://ben.green or or shoot me an email at at just Ted Power at Ben Dot Green we’d love to hear from you. Thank you.

James McWalter

And we’ll add all that to the show notes. Thank you Ted Power.

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