🌱 Why you should build in climate #002
a choose-your-own-reason guide to build a career or company in climate
Picture an imaginary line that divides people into two groups. On one side are the ‘climate conscious’ - those who already care. On the other side are the ‘climate ambivalent’ - those that may not even think it’s a real issue. For the side that’s already onboard the “solving climate change is paramount” ship, this post should further strengthen your conviction. For everyone else who may not be convinced (yet), I’ll show that pursuing opportunities in climate will not only provide the sense of fulfillment that so many of us lack today, but will also be a lucrative wave to ride for decades.
For all the crypto tech bros, I’m here to tell you that there is just as money to be made in solving climate change. The main difference being that these problems are inherently physical and actually real. For those who despise coastal elites and love Fox News, you stand to capitalize on this climate opportunity the most. The Midwest, Sunbelt, and Great Plains have key roles to play in the energy transition among other climate transformations. With carbon credits for farmers, the cheapest power, a surging labor shortage, and other economics incentives, being pro-climate is going to be (if not already) synonymous with being pro-business, pro-jobs, and pro-capitalism.
By the end, it’ll be abundantly clear that even if you only cared about financial success or having a stable job, immersing yourself in the depths of climate will be a worthy pursuit. And perhaps you might even find some other things along the way like fulfillment, meaning, gratitude, and a network of people who care about the current (and future) livelihood of this planet and its inhabitants.
Traverse the following sections based on what you’re curious about. It’s meant to be followed in a choose-your-own-adventure style. If you’re skeptical about how much innovation there is in climate, start with Learning. If you’re feeling like a corporate zombie after years of working in a Bullshit Job, perhaps check out Mission. Feel free to mix and match. And if you have the time, take a read through it all :)
Six reasons to build in climate:
Money
Jobs
Growth
Learning
People
Mission
1) Money
If what you do is defined primarily by how much money you can make, you should dedicate your career to climate.
There’s a common misconception that there isn’t much money to be made by private businesses, startups, and individuals in solving the climate crisis. Today, we can reduce emissions and remove carbon with profitable, sustainable solutions. Compared to sectors like entertainment or consumer goods, the government does have an outsized responsibility to play in solving the problem, but relying on the public sector to effectively solve the problem fast enough is wishful thinking (as we’ve seen in health and education).
VCs have the cash
The timing is impeccable because it appears that both the private and public sectors recently realized that it’s about time to deploy capital towards climate solutions. Last September, there was $290B in general US-based VC funding waiting to be invested (”dry powder”) and in November, it was estimated that climate tech funds had $37B to be deployed. It’s exciting and validating that there are this many $Bs in the bank of climate investors, who at the end of the day, have a fiduciary duty to maximize returns for their limited partners. However, as great as it sounds on paper, the mere presence of capital earmarked is not going to directly solve the problem. We need many more people actively working on climate tech startups, especially founders!
The Inflation Reduction Act (IRA) supercharges everything
Compared to other startup spaces, climate has the advantage of countless other forms of non-VC financing including grants, corporate advances, project financing, carbon offsets, government loans, and, of course tax credits and rebates from laws like the Inflation Reduction Act. The $370B IRA bill passed in August 2022 is undisputedly the most significant climate bill that Congress has ever passed. Among many things, the IRA provides tax credits and rebates across every aspect including energy, transportation, and agriculture.
The 10x ratio of the $370B IRA bill compared to the $37B in climate venture capital shows just how much firepower the public sector can bring to the table compared to the private sector. However, there’s no need to pick and choose from one pot or the other; this comparison demonstrates two key points: policy can make a huge impact and there is a shit ton of climate money to be deployed.
The fortunate reality is that backing climate companies has already started to make financial sense, even without the extra juice that the IRA bill provides:
If free money falls out of the sky, we’ll take it, but everything we’ve done now makes sense because the unit economics are there to go ahead and compete head to toe with products that are predicated on petroleum. It was actually just a bonus that the IRA got passed, but we weren’t counting on it.
[Climate investing] is recession proof, even without the IRA. Everything we’re doing is providing a substitute good. That’s what almost feels unfair.
- Chris Sacca, Lowercarbon
Climate tech unicorns (startups with $1B+ valuations) like Solugen, Arcadia, and Aurora Solar are proof points of the financial opportunities in climate tech. Dollars aside, there are also already over 50 gigacorns (startups capable of lowering or sequestering CO2 emissions by 1GT/year while being commercially viable) like Watershed, Apeel Sciences, and Turntide Technologies.
2) Jobs
If what you want is a stable and secure job, you should work in climate because it’s recession proof and will only continue to grow.
We’re in the midst of a recession and the effects of inflation and subsequently rising interest rates are impacting the job market, particularly in tech. Over 150,000 tech workers lost their jobs in 2022. While it seems like almost every company is in a hiring freeze or going through layoffs, climate tech companies continue to march forward. This is evident by the thousands of active climate jobs that can be found through Work on Climate, Climate Draft, and Climatebase. Unlike the retail, advertising, restaurant, and travel industries which are hit hardest during a recession, the unfortunate reality is that climate change problems persist (and worsen) regardless of man-made concepts like GDP.
A common concern is that getting a job in climate requires a background in hard sciences. You may be surprised to learn that regardless of your previous role or skillset, on the other side there is a climate-related job waiting for you. All climate companies (primary focus on reducing emissions or removing carbon) need engineers to build the product, marketers to market it, and salespeople to sell it. A quick glance at Climate Draft’s job board shows roles in finance, customer service, data science, design, IT, legal, operations, HR, and more. Inversely, ALL companies are realizing the need to embed climate into their product, operations, and culture which manifests in examples like the Sustainability Tech team at Uber or the Climate Strategy Director role at Lego. Whether you’re an engineer, marketer, salesperson or have a direct climate skillset in hard sciences/sustainability/environmental policy, you have a climate job to be done.
There are multiple trends playing out simultaneously. Hundreds of thousands have been laid off and need to find new jobs. In contrast, climate investors are still investing and climate companies are still hiring even through the current economic downturn. All against the backdrop of a worsening climate situation and a deep desire within all of us to do meaningful, fulfilling work.
addendum - If you’re wondering if it’s even possible to transition into climate from something entirely different, I’ll cover this separately. For now, check out some folks who are paving the way, each in their own way:
Peter Reinhardt: CEO of Segment → CEO of Charm Industrial
Calvin French-Owen: CTO of Segment → Exploring heat pumps
Lauren Singer: Zero-waste activist → Founder of Package Free
Tsung Xu: User Researcher at Uber → Writing + podcasting via Materially Better
Shashank Samala: Cofounder of Tempo Automation → CEO of Heirloom
Yin Lu: Leadership at Khan Academy → Partner at My Climate Journey
3) Growth
If you’re optimizing for the long-term, you should build your career in climate because there’s only going to be more growth.
So far we’ve uncovered that there are billions of capital waiting to be deployed in climate solutions and plenty of jobs even during this recession. If other climate technologies experience anything close to the growth that solar has had, we’ll continue to see steep learning curves and rapid cost reductions. And as history has taught us with electricity, the telephone, and the internet there will be new, unimaginable problems to be solved and this (electric-powered) train isn’t slowing down any time soon.
When people use the term ‘technology’, it’s interpreted based on what is considered innovative today. Right now, that looks like AI, blockchain and CRISPR. However, there was once a time when having the ability to cook on a stovetop without lighting a wood fire or seeing at night with an electric light instead of candle was thought to be a form of technology. The dictionary definition is “the application of scientific knowledge for practical purposes, especially in industry”. I can’t think of a more suitable example of technology than everything that’s playing out in climate today. From solar to EVs to MRV (measurement, reporting, verification) to DAC (direct air capture) and more, technology is at the forefront of climate today.
“The future is already here. It’s just not evenly distributed yet.” - William Gibson
A specific technology or product has high growth potential if and only if it has successfully exited the R&D stage by proving economic viability and can be deployed in a scalable manner. Given its decades-long history, solar is a good case study candidate among other cleantech technologies for what the next couple decades could look like. Let’s take a look 👇
Over the last few years, the price of electricity from monopolistic utilities has only steadily increased…
…while the cost of solar has dropped significantly and already crossed the affordability threshold. The end result: solar is cost-competitive with fossil-fuel generated electricity:
As a result, in the US, the breakeven point for residential solar is 5-10 years. This only continues to shorten as utility rates increase and solar costs decrease. With just 3% penetration in the US residential market, there is still so much growth remaining.
What’s particularly fascinating is that even the experts can’t seem to predict how quickly technology is transforming the world. The leading authority IEA (International Energy Agency) has consistently, year after year, underestimated how fast solar photovoltaics (PV) would get installed.
After understanding these trends, you might find solar promising, but are still wondering how this is relevant to you. Isn’t this just a matter of manufacturing more panels and then climbing onto people’s roofs to install them? Well, it turns out it’s not as simple as that. These are just some startups building software specifically for solar companies (which I’ll cover in an upcoming piece)
But this section isn’t a sales pitch for homeowners to get solar modules installed on their rooftop. Solar is just one example of a climate-relevant technology that is undergoing rapid growth. There are massive tailwinds behind climate solutions and it’s still so early. Solar is just one technology among batteries, EVs, heat pumps, synthetic biology, etc. Furthermore, there are other climate solutions that are dependent on what I call ‘layer one’ technologies because they require high amounts of energy such as vertical farming, direct air capture, and green hydrogen . Given the end goal is decarbonization, these ‘layer two’ climate solutions are dependent on cheap, zero-carbon energy sources. Some of these technologies will experience similar growth trajectories as solar has. In future posts, I’ll address each of these with its own deep dive.
4) Learning
If you want to optimize your life around learning, you should build in climate because new ways of thinking are required to build solutions for problems we’ve never solved before.
I must study politics and war that my sons may have liberty to study mathematics and philosophy. My sons ought to study mathematics and philosophy, geography, natural history, naval architecture, navigation, commerce and agriculture in order to give their children a right to study painting, poetry, music, architecture, statuary, tapestry, and porcelain.
- John Adams
I interpret this as Adams pursuing pragmatic pathways for the flourishing of future generations. However, through the lens of today’s climate crisis, I don’t think we need to silo these paths from each other or make noble sacrifices for our future offspring. I’d posit that we need to approach this massive problem with the reach of politics, the seriousness of war, the truthfulness of the sciences, and the creative finesse of the arts.
Solving climate change is one of those ever-evolving challenges that is both attainable, but also incredibly difficult. With no prior playbook to follow on how to decarbonize and new technologies being developed at this very moment, we’re building the airplane as fly, laying the tracks as the train lurches forward, or whatever other silicon valley buzzword phrase you want to use, which makes for a much more interesting game.
Viewing Climate as the ultimate game
The best kind of games strike the right balance between difficulty and skill. It’s why the most fun basketball games are when everyone is around the same skill level, rather than playing against four feet tall children or a squad of NBA players. In Climate Tech: The Greatest Game, Ari Lapinsch dives into the goals, rules, and interactions of climate. Today, we’re inundated with an abundance of information which distracts us from what are truly great games. With a set of challenging, but not impossible rules to obey, an inspiring set of players to play with, and literally the largest board game 🌎, climate is the ultimate game.
New technologies → New learnings
In Silicon Valley, it’s well understood that engineers gravitate towards building large, impactful projects rather than tiny tickets, bug fixes, or being on-call. On job postings, it’s common practice to list the tech stack that’s used because software engineers care about using the latest and greatest technologies. I don’t blame them! We all have the desire to be challenged and tinker with new technologies. No one wants to be bored.
In all of history, we’ve never had to try to reduce emissions or remove carbon. In fact, the lack of these objectives is precisely why we’re in this mess now. The advent of these challenges means that we’re having to solve new problems with new solutions. Novel technologies like using synthetically engineering enzymes to make chemicals (Solugen) or the combination of lidar and AI to accelerate the deployment of solar (Aurora Solar) were invented without a pre-existing case study to follow. We’re off to a good start, but there is still much to be solved. Like how are we going to speed up interconnection by 100x? (it is slow AF right now)
For the tinkerer who’s been wondering what’s next after the recent mobile wave or the engineer working on ads trying to improve click rate by .001%, it might be worth checking out what’s going on in climate. You might just stumble upon a technology worth building with.
Other Tailwinds
Global warming and rapidly rising sea levels incentivize us to address these problems sooner rather than later. The recurring forest fires, droughts, and floods have resulted in thousands of deaths and the economic destruction of billions of dollars. We’re now being forced to urgently invest in climate resilience and adaptation just to avoid further catastrophes. Governments are implementing specific climate adaptation policy and the private sector is active as well, like Convective Capital, a venture capital firm solely focused on stopping wildfires.
As a society, the sentiment is shifting as well. Consumers are weaving sustainability into their everyday habits and purchasing decisions which in turn demands corporations to change. Whether Starbucks getting rid of straws to remain a relevant brand or Google, Microsoft, and Netflix making net-zero commitments to recruit new employees, companies are taking note of individuals demanding collectively.
What will technology “unlock”?
For every game-changing company that’s been created in recent years, VCs love to reflect and explain why it worked and what technology made it happen or “unlocked” it. For Youtube, it was Adobe Flash that enabled videos to be hosted online. For Uber, it was the rise of GPS in every smartphone, making it possible to match drivers and riders together. For Figma, it was WebGL which greatly improved the rendering of graphics in the browser. It’s easy to look back on success stories and pick out the reason why it worked, but like Steve Jobs said “You can't connect the dots looking forward; you can only connect them looking backwards.”
Trying to answer the quintessential “Why Now?” question for climate by solely focusing on new technologies overlooks the biggest reason to accelerate our efforts - the catastrophic consequences of doing nothing. While it is possible to point to actual new “unlocks” such as cheaper, renewable energy resulting in vertical farming, direct air capture, graphene, and green hydrogen, looking at solely new technologies overlooks major tailwinds such as policy and consumer sentiment that will make the next decade critical for climate.
We’re writing the script as we go
The combination of audacious goals, new technologies, and (sadly) existential urgency makes Climate a compelling arena to operate. Climate problems are new, unchartered territory that will require us to chart the map as we go. It’ll require us to bring together the academia, startup, and public sector worlds to design, engineer, and launch new products in ways we haven’t seen in decades. The sheer amount of unknowns and possible ways to tackle the problem mean that anyone who’s curious and willing to put in the work has the learning opportunity of a lifetime.
5) People
If you’re looking to work with ambitious, conscientious people, then you should build in climate because at the end of the day, it’s the people who make it all worth it.
Over the course of our life, in addition to our partner, family, and friends, we end up spending a ton of time with our coworkers. Given how short life is, it’s worth considering the type of people we want to work with and examining whether our current situation matches up to those expectations.
When work is more than “just a job”
Some people view a job as just a job. Clock in, clock out. They’re able to compartmentalize the work part of their identity from the rest of themselves and view their job as a means to an end, in this case, a paycheck. Others aren’t hardwired that way. They need to feel like what they’re working on is actually a net positive for society. In an effort to avoid cognitive dissonance between their beliefs and actions, people seek out work that aligns with their values and worldview, some of who end up landing on climate.
Being a part of something bigger than themselves
One aspect of climate is working on something larger than themself. From the fifty or so climate conversations over the past few months, everyone I’ve met has cited the importance of solving the climate crisis in how they got into this space. Perhaps it’s the decline of religion that’s contributing to this increased yearning for finding meaning that’s led to this rise in expecting work to be a major source of fulfillment. This is anecdotally apparent in parents who recently had their first child. As a young single dude, I can only speculate that there’s something about staring into a fellow human that you co-created that makes you think “Oh shit, I need to make sure the world remains livable so you can survive.”
Shared values
It’s a cliché at this point to answer “What’s your favorite part of working at ____?” with “Oh, it’s for sure the people.” In my experience of going through hundreds of interviews, I’ve asked this question many a time to the other tile on zoom. It’s a great answer since who you work with is truly such a major component of your sense of job satisfaction. However, the cynic in me finds it a bit skeptical that everyone loves working with each other at every single company, no matter whether they work on optimizing the click-through-rate of ads, IT change management, or some B2B CRM SaaS startup.
I find it hard to believe that every organization can be so kumbaya and sing songs around the metaphorical campfire together. I just think it’s really hard (or rare) to find someone who is truly fired up about things like DevOps automation or SOC 2 compliance. The number of logical leaps it takes to find resonance in certain work is mind-numbingly taxing. For climate, in my opinion, it’s easier to make it make sense. After all, we are only the stories that we tell ourselves.
6) Mission
If you want to live a meaningful life and seek out fulfilling work, consider building a career (or company!) in climate. You’ll be a part of one of the most, if not the most important missions of this era. Along the way, you might even make some Money, find a great Job, experience rocketship Growth, Learn a lot, and meet some amazing People.
If you made it this far, I’ll let you in on a secret. I intentionally sequenced the six reasons in ascending order of importance, which leaves Mission as the crux for why you should build in climate.
We’re currently suffering a meaning crisis, resulting in people feeling a void in their lives that they can’t pinpoint, yet they know is present. The popularity of personal growth books has skyrocketed as have decorative words like ikigai and “finding your passion”. In an attempt to tap into this dire need for meaningful work, every major corporation has reworked their mission statement to more-or-less “making the world a better place”:
Facebook: “To give people the power to build community and bring the world closer together”
Microsoft: “To empower every person and every organization on the planet to achieve more”
McKinsey: “To help create positive, enduring change in the world.”
Coca-Cola: “To refresh the world, To inspire moments of optimism and happiness, To create value and make a difference”
Walmart: “We aim to build a better world — helping people live better and renew the planet while building thriving, resilient communities.”
The omnipresence of the same fabrication dilutes the value of the mission statement entirely. We can’t trust the words on a company’s About Us page, so we must do the hard part ourselves and actually think about what purpose to commit to.
I tend to be more techno-optimist with an abundance mindset, but painting an accurate map of reality requires pointing out just how serious the problem is. It’s only through understanding the magnitude of the problem that we’re able to forge the sense of agency required to solve it.
In 2015, ~200 countries signed the Paris Agreement, agreeing to work together to limit global warming to 1.5°C above pre-industrial levels. Although the difference between 1.49 and 1.5 will be difficult to measure, scientists agree that things will get worse as the planet continues to heat up. Since 1880, the Earth has already warmed by 1.2°C and inflicted large-scale destruction. The last couple years have seen bushfires in Australia that destroyed 46M acres, record-breaking flooding in Pakistan that resulted in 10M children in need, and many more devastating events. And all of this is before we’re at the 1.5°C mark.
Unfortunately, experts already think we can’t hit our goal of limiting global warming to 1.5°C by 2050 and things get worse when we pass the mark. As global temperatures rise, droughts get worse and sea levels continue to rise. The vast amounts of ice in the Antarctic and Arctic regions begin to melt at a much faster rate which is incredibly dangerous considering there are 1,500 gigatons of carbon sequestered in permafrost. That’s more than double the amount of carbon in the atmosphere. Past 1.5°C, the risk of reaching multiple climate tipping points increases dramatically. If these events occur, the feedback loop will spiral out of control and the damage can never be undone.
Today, the signs of manmade global warming are already clear and experts predict that we’re off track from our goal. We know that things will get a lot worse if we don’t meet our climate goal. There’s a lot more that could be said about how bad things can get, but hopefully without going full doomer, there’s a sense of why this mission is now existential.
What now?
The next issue will cover how to generate and validate climate ideas. Subsequent pieces will focus on specific areas of climate relevance, like solar software or home electrification. Soon after, I’ll launch the Build in Climate knowledge hub which will be the go-to climate resource highlighting the most helpful domain experts, resources, and communities I’ve interacted with over the past few months.
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