Inspired with Alexa von Tobel
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.
00:21:23 · Taylor Francis
[00:21:23] S0: Yes. Yes. Exactly. So, the carbon in the economy is very connected across supply chains. What's a good example? If you are producing electronic devices, we work with one of the biggest computer manufacturers in the world, your emissions are generally coming from the things you're buying from your suppliers. And it's coming from fabs, and semiconductors, and plastic, and aluminum. And In order to decarbonize, you actually need to work with your supply chain. And that collaboration is not easy, but it's also where all the magic happens. And so, that is our theory of change. Our theory of change is that if this demand signal can come from companies, from regulators, from consumers, it can show up at each stage of a supply chain, in a company making a very concrete decision to switch to clean power, produce a lower carbon material, be more efficient, move a good with an EV truck rather than an internal combustion engine truck. And in order for that to happen, there actually needs to be a means of value exchange between those companies. And that's where keeping score on what's the carbon of each trade off, what's the carbon of each product and decision, enables companies to collaborate on that. So we feel like we're the supporting player. We're behind the scenes. We're just trying to enable these massive companies, massive suppliers with huge impact. But that type of collaboration is the thing that we think can change the world.
00:23:09 · Alexa von Tobel, Taylor Francis
[00:23:09] S2: I love that. And we're gonna talk a little bit about where you think the world is heading in a second. But one thing I just quickly wanted to say, so Watershed Series A was notable in that you were two of the more influential investors of the last few decades. Sequoia's Michael Moritz and Kleiner Perkins' John Doerr co led the round. Before that, in your career, you interned with Sheryl Sandberg. You've had some exceptional people around you, and as you, you know, said you got to work with the Stripe founders. I would love just to get a sense of having been able to be and learn from some really iconic people. What if... What do you feel like you've absorbed from having that be your boardroom? [00:24:00] S0: Yeah. We've been so lucky on investors. I think two things, maybe three things. One is hard work, man. Know? Amen. Really, I don't know that there's a lot of well, it's nice to see people at the very top of their game and realize there's no shortcut. Feel like Mike Moritz and John Doerr, two of the best investors in history, fastest people to respond to an email, most prepped people at a board meeting. They just put in the work, and they put in the hours, and they put in the time. [00:24:39] S2: By the way, Taylor, above that wall is a big joke. It's no shortcuts. [00:24:43] S0: No shortcuts. [00:24:44] S2: There's no shortcuts. And