Inspired with Alexa von Tobel
00:13:40 · Taylor Francis
[00:13:40] S0: Yeah. So if you're a Fortune 50 company, you've got a complex set of operations, products, suppliers, transportation, customers. And as you said, there's a two thirds chance. You've set a commitment saying we want to reduce those emissions over time, in line with what the science tells us is required to solve the climate problem. So how do you go about doing that? First thing you've to do is figure out where are your emissions coming from. Indeed, space has this protocol to think that through. There's three categories. The One emissions from facilities you own. So your cars, your planes, if you operate a power plant, or a chemical plant, or a paper mill, gases that are being released directly into the atmosphere from your assets. Scope two is the emissions from the electricity consumption. It may be happening somewhere else. It may be happening at the power plant on the electricity grid, but it's from the electricity. You're turning the lights on. You're running your factory. And then scope three is everything else in your supply chain. So if you're making cars, it's the steel and the plastic and the leather that go into a car. If you're making software, it's the energy that runs the data center that trains the AI model that you're building your business around. If you're a food business, it's what's happening on the field. Is there deforestation or is there fertilizer? What's happening with your customers when they actually plug your device, your appliance, the wall? So those are the three categories. And our philosophy is you wanna measure quickly so you can figure out where your leverage is.
00:15:23 · Alexa von Tobel, Taylor Francis
[00:15:23] S2: Yep. [00:15:23] S0: And then focus all of your attention there. And that's different for every company, but ultimately our thesis is you wanna get as quickly as possible to thinking about what is the intervention in the world concretely, practically, tactically that you wanna have happen? If you're in the food business, it's probably less deforestation in your supply chain. If you're manufacturing consumer electronics, it's probably clean power at the manufacturer of your suppliers who are making semiconductors. It's generally not that complicated. So we try to make it easier for companies to figure out, okay, this is the thing that matters, and let's focus our effort there. [00:16:02] S2: Let's talk a little bit about where Watershed comes in and makes reporting, measuring easier. Give us a tangible example of kind of what that looks like. And and to just repeat it back, you've got scope one, two, and three, which effectively is all the ways that any company that is existing is impacting our lived environment and climate. Yep. Where does Watershed come in? [00:16:25] S0: Yeah. So think of Watershed as enterprise software and AI for sustainability data. [00:16:32] S2: Got it.
00:16:33 · Taylor Francis
[00:16:33] S0: So if you're a company, you've got Workday for bringing sense to your HR domain. You've got Salesforce for bringing sense to your go to market domain. You've got Watershed for bringing sense to your sustainability data. And we start by basically plugging into the systems of record of a company and ingesting data that may not be in any system of record. PDFs of utility bills and bills of materials that are not well standardized. Those come into Watershed. We built this data engine that is informed by the latest science about where do emissions come from? What is the emissions of a pound of beef from Brazil? How is that different than the emissions from a different product or input? And then we give companies this kind of BI dashboard for their sustainability data. Once you've got that, companies wanna do a couple things with it. The CFO raises their hand and says, We're going to use this to disclose and report. Five years ago, companies were reporting voluntarily. Today, Australia, Singapore, New Zealand, UK, EU, California, New York, Mexico, Brazil, dozens and dozens of countries and jurisdictions have this as a regulated disclosure alongside financial results, privacy, security, that sort of thing. So the CFO says, I love that this data is well governed. It's auditable. It's in a system of record, there's no fat fingered mistakes, it's gonna pass audit. It's gonna be the basis of how we communicate with investors and customers about this data. The procurement team says, We're gonna use this to buy greener materials for our products. The product design team says, We're gonna use this to make sure that when we're designing the next version of our shoe, we're thinking about where does the carbon come from and how can this be a low carbon product. And so it becomes this tool for decision making as companies realize generally that there's a lot they can do that actually improves the business and reduces carbon at the same time.
00:18:34 · Alexa von Tobel, Taylor Francis
[00:18:34] S2: That's incredible. So it's not just reporting and measuring, it's actually helping companies take action and begin to play offense Yes. And understanding their proactive decisions that that can impact the environment. Taylor, I wanna talk a little bit about your go to market. By the way, I love the name Watershed. Can I just say that? It's like even [00:18:55] S0: Picking a name is so hard. Anyone who's picked a name, it's so hard. [00:19:00] S2: It's so hard. I joke all day long that it's like this company and that company and this company, and they all have one tweak, and I'm like, they're all the same name. Watershed is just a... It's... And it's it's Watershed. Like, it's Oh, [00:19:12] S0: thank you. [00:19:13] S2: It's goddamn good, Taylor. Nice job. Can [00:19:16] S0: I give the the quick story behind that, Alexa? [00:19:18] S2: Yes, please.
00:19:19 · Taylor Francis
[00:19:19] S0: We found it so hard to pick a name. So after we picked this idea, we made a sales deck that was, hey, here's what it is we do, and we went on the road, and we talked to 50 customers in the next month. And we got all the way to being a couple days before signing a contract with our first customer. And we were like, we don't have a name. The sales deck didn't have a logo on the first slide. It had the customer's logo on the first slide. And so we killed ourselves for two weeks trying to pick a name. And The thing we liked about Watershed is, again, back to the outdoors, there's actually two ecological meanings of a Watershed. One is the connected ecosystem of rivers and trees and meadows that all flow out the same river. And that, to us, resonated with the idea that companies are connected in ecosystems of what they produce on carbon, and we were gonna try to enable a cascade of decarbonization. But then the British definition of a watershed is the ridgeline, where if a water drop falls on one side, it goes out to one river valley, and if it falls on the other, it goes out to another. And that's where you get this phrase of the watershed moment, because that is the turning point of, am I gonna be in California or New York by the time I make it to the ocean? Feel, and for all the bad news on climate, for all the bad news on climate policy, it does feel like in the last ten years, we have flipped to the other side of the mountain where the world is gonna decarbonize, and it's just a question of how long it's gonna take. So anyway, time a few outdoorsy threads together around that.
00:20:59 · Alexa von Tobel
[00:20:59] S2: You perfectly teed up my next question, which is at this point, you have major companies, FedEx, Walmart, Airbnb, Spotify, many global banks, and you're not just helping them individually. But to your point of the Watershed, you're actually helping entire ecosystems because there's a network effects to what you're doing. Say more. Help me understand that.