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Climate action 101 for startups

“Climate risk is investment risk,” stated BlackRock’s CEO Larry Fink in his annual letter to chief executives earlier this year.  What’s more – the claim is backed by making sustainability the new standard for their investment strategy. Coming from BlackRock, the world’s largest asset manager, it might be enough to tip over how investors think about sustainability. And with that, how founders prioritize it, too.

I would bet that by the end of 2021 every startup founder will have to answer the question: “And what do you do to stop climate change?” Keep reading to find out what could be your answer.  

The challenge is that in the majority of tech companies with less than 500 employees, sustainability is that hot potato topic that no one knows how to handle. Some team members may have firm opinions. Some are science-based, some are assumption-based and some are plain ignorant. It’s an all-or-nothing kind of thinking, and with the limited resources startups usually have, it’s usually the latter one.

Is that the right way to approach climate change? I don’t think so. Inaction is the worst response. Meanwhile on the other side of the spectrum, taking action will increase your competitive advantage in the eyes of investors, employees, and customers.

If you do just one thing right and communicate it well, it’s enough.

Like for many other things in the startup world, the trick is to figure out the Minimal Viable Product— in this case, the sustainability MVP. You’re not Unilever- neither in terms of your business, nor your sustainability strategy. Don’t try to be.

What is the easiest and most impactful thing you can do? A simple customer survey can give you that answer. Choose one thing that suits your company values the most and include it in the project pipeline like you would for any other project.

What the MVP sustainability strategy could look like:

  • measure, reduce, and offset your carbon footprint;
  • spend one day per year doing something good for the environment (cleaning up a beach, planting trees, helping the local community);
  • commit to eliminating plastic from product packaging;

If you choose the route of offsetting your carbon emissions (which would be the most scientific and measurable approach), below are the TOP 3 companies I would trust.

The thing you need to realize is that becoming carbon neutral as a software company is not that expensive. The average carbon footprint per employee for a software company is approximately 6 MTCO2/year. And offsetting that would cost around 30-120 EUR/year. I have talked to each of these companies, followed their progress over time, and researched them for you.

Pick one and take action.

Plan A
If you’re a software company with one office space – Plan A will be the best solution for you. It’s easy. The team walks you through the whole process, you get suggestions for reducing your footprint and options to buy verified carbon offset projects. This company is led by the fierce Lubomila Jordanova, who’s currently one of the main thought-leaders on the topic of sustainability in Europe.

Compensate
Although still a rather new solution, I’ve been following their growth since I first heard about them at Slush 2019. The non-profit team is based in Helsinki and is committing 100% of their time and energy to reducing carbon dioxide in the atmosphere. They can help you calculate your footprint, offset unavoidable emissions by investing in carbon capture projects (the new & cool way to become carbon neutral, approved by Bill Gates), and can offer solutions for enabling your customers, too.

Pachama
Main offset provider for Shopify and all of its e-commerce stores. Backed by Paul Graham (Y Combinator founder) and Chris Sacca (Lowercase founder) to name a few. They use technology to do offsetting differently, maximizing the amount of money actually being delivered to their offset projects. They help you calculate your company’s carbon footprint and then offer various projects to invest in – you can choose based on your geographic or other preferences. In the end, you receive a certificate of carbon credit retirement you can use in your communication.

And once you have taken action, share your journey with your customers, your team, and investors. They will celebrate this step with you. And so will I.

Photo by Christian Mack on Unsplash

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