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CleanTechies
#130 Financing Emerging Clean Technologies, The Incentive of Repeat Transactions, Hiring a Founding Team, & More w/ Kevin Kyer (Pyrpose.io)
Why you should listen:
- Learn how to hire a founding team
- Find out the secret to properly structured incentives to achieve repeat transactions when working in emerging markets
- Learn how to communicate your offering to non-climate-nerds
In this episode, Silas Mahner (@silasmahner) & Somil Aggarwal (@somil_agg) speak with Kevin Kyer, the Co-Founder, and CEO of Pyrpose - a direct lending platform that, using the crowdfunding laws, allows individuals to lend to companies creating clean solutions in order to deploy their technology, the user is also getting a return on their money. They specifically focus on emerging markets because of how high the cost of capital is and the unwillingness of large lending institutions to operate in those markets currently.
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Topics:
1:59 Intro
8:48 What is Pyrpose?
15:22 Marketplace Approach
18:04 Consumers and sellers
25:59 GTM
29:01 Raising on this model
32:26 Crypto and climate
35:49 Picking a founding team
42:41 Finding talent
45:46 Advice to Founders
49:16 Climate-specific PMF advice
52:23 Ideas
Links:
**Connect with Kevin: https://www.linkedin.com/in/kevinmkyer/
**pyrpose.io
**Check out our Sponsor, NextWave Partners:
**Follow CleanTechies on LinkedIn:
**Twitter: @silasmahner / @somil_agg
Other episodes you might enjoy:
**Similar Topic: How Microfinance Helps Unbanked & The Climate Vulnerable w/ Celyn & Kristen (ShareChange)
**Something Different: CleanTechies, the Podcast #25 - Edi Demaj (KODE Labs)
Thank you for listening!
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Welcome back to the Clean Techies podcast, where we interview climate tech founders in VCs to discuss all things building and investing to solve the biggest challenge of our generation climate change. Today, somail and I had the chance to speak with Kevin Kyer, who is the co-founder and CEO of Purpose. I originally thought it was pronounced pyrpose, but it's pyrpose P-Y-R-P-O-S-E. They are building a direct lending platform that, using the crowdfunding laws, allows individuals to make a return by lending directly to companies creating clean solutions in the emerging markets. They focus on emerging markets because of how high the cost of capital is and the unwillingness of large lending institutions to operate in those markets currently.
Silas Mähner:Kevin has a really interesting background, working with the likes of Yahoo as an internet marketing specialist, so he offered a few insights on their roadmap of going directly to consumers. Initially, he had some great advice for setting up your founding team, how to identify product market fit, including applying the climate lens, and he shared a few thoughts on the way climate and blockchain people are starting to work together. Lots of really great stuff here and also super fascinating business model. Enjoy the episode All right. Welcome to the show, kevin. How's it going?
Kevin Kyer:Pretty good man, good to see you.
Silas Mähner:Yeah, absolutely Good to be on the call, really excited to record this one. So I guess let's just get started by giving us a quick intro to yourself and kind of what you're doing today.
Kevin Kyer:Yeah, so my name is Kevin Kyer. I'm the co-founder and CEO of Purpose. Purpose is a climate finance platform that's designed to be for the everyday person who's concerned about the planet but hasn't yet been in a position to invest in the future of the planet.
Silas Mähner:Very good. So we'll get into what that means a little bit more later, but can you explain kind of how you ended up doing this, like what's your backstory, how did you get here? Because I think it's a pretty interesting one.
Kevin Kyer:Yeah, so I didn't have like this, you know, like grand vision that I started out in high school with some sort of plan or, like you know, riding code in a high school or something like that. It really was a bit of sort of like a journey, and I see that a lot with climate founders we don't come from a climate space because those jobs weren't available 10, you know, 15, 20 years ago. So our origination really probably the very first time that we even thought or even thought about doing something like this, was when I got involved with a company that was doing renewable energy in off-grid communities and I helped them to get their initial seed capital and I saw how their product and their solution was. You know, it wasn't just reducing carbon emissions, it was like changing people's livelihoods. And that was a little over 10 years ago and, funny enough, that's when I was working at Yahoo, where I was, you know, optimizing algorithms and monetizing pixels, and I just couldn't figure out where was the money in this? You know, how does somebody do good on the planet and then make a return and then fast forward about 10 odd years and a couple of startups after that were again, I'm just, you know, optimizing pixels and algorithms for varying different causes.
Kevin Kyer:And I started getting into the impact sector here at Geneva and in Geneva it's huge on the SDGs like the businesses know about it, the kids in the school know about it. And as I was working with this impact accelerator and then eventually started running the impact accelerator, I started to see that blend of profit and purpose. And then you know there's a longer version we could potentially get into later if it's of interest. But like how it eventually came to creating purpose was really it was the network. You know it was a bunch of us that had similar sort of different ideas coming from different angles and trying to figure out why are we doing enough funding and climate? Who's doing the funding today? What are the problems with all of that? And then, is there a technology or solution that solves for that?
Ana Konstantinova:Impact brands represent the choice to live our lives in alignment with planetary action and our values, to preserve our amazing home for generations to come, be it through solar panels, how you travel, where you're sourcing your materials, the choices we make matter, and I know you know that if you're listening to this podcast. My name is Anna Konstantinova and I'm on a mission to make impact brands our next paradigm. I believe that marketing can be used for us rather than against us, and I want to help you build the best brand possible so we can all pour our strength into solving the biggest issue of our time. Whether you're a founder or an investor representing portfolio companies, let's work together to make sure your brand is seen, heard and remembered the way it deserves to be. And as a thank you to the Clean Techies community, I'm offering 20% off my newest launch Branding Sessions with code Clean Techies.
Ana Konstantinova:One word We'll take 60 or 90 minutes to solve one specific problem, whether it be a naming issue, strategy, development, business growth or beyond. Let's put our minds together and move forward with renewed energy. Can't wait to hear what you're working on. Find me at anacodeco. That's a? N? A, k? O dot c? O. Talk soon.
Kevin Kyer:And is anybody doing a good job at that today? So that was kind of like the the starting point, but I'm now rambled for a bit, so maybe, maybe we should dig into it.
Somil Aggarwal:No, I, I don't think the the rambling is super helpful because actually one thing had brought up an interesting point. So you talked about your background and your foundation in Switzerland, and so the start of communities in different areas, we know, differs widely. So, based on the innovation ecosystem you were in, especially as an accelerator, what do you think are the biggest problems people are focusing on? Just as a sort of a background to set the scene, were you entering a space that people were asking questions about but didn't really know a lot about? Was it a heavily hot topic? What kind of space was the? You know, carbon finance, carbon footprinting at the time?
Kevin Kyer:Carbon climate related. So this is going back five years ago. Definitely was starting to be a topic, right. I would say things kind of I feel like truly kicked off sort of 10-ish years ago. And then here in Geneva, like people know when you say SDGs what they mean and like some of them are like super memorized when it comes to the companies there's that side but then from a capital perspective five years ago and this is part of the challenge and why we're doing what we're- doing is that I felt that it was just too niche.
Kevin Kyer:Like, impact investing is relatively niche, even if you see, you know, a trillion a year flowing into it out of the 100 trillion globally. But then climate was like this other sub-niche of it, and so I think there just wasn't enough understanding of what are the problems, how do we solve for these problems? I came across a lot of companies that were treating climate as a donation, right, so you care about the climate. So here I'm going to siphon off a portion of my income, and that can be through my daily habits or that can be through my bank, or that can be when I'm making a purchase. I round up and I felt like that's just little pennies dropping in, and, of course, if you get, you know, hundreds of millions of people doing it, that's great, but there's just not enough scale. So it was getting started, but the knowledge gap was rather large, rather large for sure.
Silas Mähner:Hey, there. Are you building a climate tech business and looking for very specialized talent? Consider reaching out to our sponsors, next Wave Partners. Next Wave are experts in talent acquisition, recruitment and retention across the climate tech, renewables and ESG spaces globally. So if your team is growing or you're looking to make a career change yourself, feel free to reach out to Next Wave at Next-WavePartnerscom or reach out to one of their consultants directly via their LinkedIn page. Okay, interesting. Yeah, that is really fascinating to hear the timing and the way people looked at it at the time. I am curious to go further into now what you're doing. Can you kind of really walk us through what exactly is Purpose doing? And, by the way, I've also disclaimed I thought it was Pyre Pose until you said it. So what is Purpose doing, and walk us through the exact mechanics of how it works?
Kevin Kyer:Yeah, I'm glad that it made you think about how to say it. That was intentional. There's this whole thing about our spelling and the Y and our logo and the logos of Mobius, and there's this whole marketing story, but again, we'll say that for some other day. Okay, so add its most simplistic form and then we can dive down in each one of these rabbit holes. Add its most simplistic form. If you're a climate conscious consumer which there are lots of them across Europe like I feel very, very fortunate. 93% of Europeans see the climate as a serious issue. I'm from the States I don't know if either of you have ever seen anything 93% of the population of the US ever saying yeah, we agree with that, right? So I'm like super fortunate. I live in Switzerland.
Kevin Kyer:So let's start off with your climate conscious consumer. You have disposable income. You are already doing things. So you're aware, right? You're not like is this thing real? Do I really believe I need to be doing something? So you're already doing things, and then what we're giving you access and the ability to do is to invest where your passion is, which is the climate.
Kevin Kyer:So then let's talk about what does that mean in terms of investing. So we looked at the realm of investing you could do so. You could go into the secondary market. The secondary market is bonds and shares, right, and you're not actually investing in that company. You're paying another investor for their shares. So we're like, well, that's not direct, so that's good. You know there's shareholder activism, there's people doing things of that nature, but what we really wanted to do is make sure that the capital had a direct connection. Your individual capital had a direct connection to reducing future carbon emissions. No off-use skating in the middle, no middleman doing something this, that and the other and you're trying to figure out did I really do something good for the planet?
Kevin Kyer:So then it came down to what is the structure, and the structure is lending working capital to small, medium-sized enterprises. Those small, medium-sized enterprises use that capital to grow their impact. Right, so they're selling renewable energy products that could be in a home, that could be at a school, that could be at a building or it could be electrifying a scooter that was using fossil fuels before. Right, so they borrow the capital. You, as a user on our platform, are part of participating in that lending to that company. The company then sells their products. They sell them. They don't donate them. They sell them, so the profit motive is there. Then, as that profit motive comes back and there's interest on the money that's been borrowed, purpose participates in the interest, as does the individual consumer.
Kevin Kyer:But the part that's different there's a handful of lending platforms out there today. The part that's different for us is that we track everything through blockchain and it's not like blockchain solves the world and suddenly, because you have this consensus mechanism, now everybody believes what you're doing is real right. But a big part of it, too, is just that engagement. So if you were to go out and buy a share of a company today, are you going to have direct connection to that CEO? Are you going to be able to have an AMA with them? Are you going to be able to ask them questions and get videos and pictures throughout the month that sees what they're doing? And maybe if you follow them on Instagram and you get lucky and they respond to one of your notes, but the idea being that you have a human to human connection, not only with the individuals, the trailblazers doing the hard work on the ground, but then the communities and the people that are getting these solutions. So then we get to the community aspect of it. And for us, again, we analyzed all the different solutions that could be out there and our entry point is to go into and we are emerging markets.
Kevin Kyer:So emerging markets are often the markets that get hit the most by climate change and they're also the markets that, when you transition somebody from traditional fossil fuels for energy, for light, then when you move them up to clean and renewable sources of energy, not only are you doing something for the planet, you're changing their livelihoods.
Kevin Kyer:So you're improving their health because there's no fumes from the kerosene. You're saving them money because they're not buying kerosene. You're often helping young children get better grades because you can imagine if you had to study by a burning stick or a candle or kerosene versus if you had a solar lamp sitting at your desk. We all know which one's easier. So for us it's the greatest need, the greatest, almost called like a carbon plus. Hey, I removed X amount of metrotons future carbon, but I've also done this to improve people's livelihoods. So, in summary, you as the individual have the ability to have a direct investment into climate SMEs. You get a return as that money is being used. You directly see through videos, chats, amas and, of course, an impact report provided by a third party, not by us. That shows, okay, your capital is aligned to your values and you are now making a real, tangible difference towards the planet and, of course, the livelihood aspect as well.
Silas Mähner:So one thing I'm curious about is, with this, is this all automated? Or are people going to need to like kind of like angels list, almost like look at the opportunities and then make investments, or is it just something that they put in and it will be taking care for them?
Kevin Kyer:So there's. So I've worked on on marketplaces most of my career. The way that we're approaching it and I don't know if it's right, but it's, it's based off of the experience I've had is you provide fewer options at the beginning and then, as you progress, then you provide that capability and that, that, that filtering concept, right. So in the beginning it's sort of a package deal. But then let's say, silas, we opened up a solution in New York City and you're like, you know what developing markets are great, but I really like to see something closer to me in my community or wherever you're based. That is something that we want to be able to do and you should be able to invest in your own community energy transition.
Kevin Kyer:But for us it's an evolution, right or wrong. We're starting off with a package of emerging markets and then we could go vertical on that. We could go more risk, less risk. Or maybe somebody has an affinity to schools and they don't care about energy transition in buildings, so they could select schools, right. Or maybe there's a gender lens that people want to put on it and they're like, look, I only care about female founders, or whatever it may be. So it's at the beginning, packaged, simple and then, as time progresses, allowing that sort of customization based off of what your objectives are.
Silas Mähner:Yeah, no, I mean, I think that's actually quite interesting. The reason I was asking is because I would find it difficult to get people to be continually engaged if they have to go, you know, make the selection themselves, versus just, you know, kind of letting the money go to work once they put the money in on a recurring basis or a one time basis, yeah, so anyway, I appreciate that.
Kevin Kyer:Yeah, that's the idea. I mean we'll see. I mean we're. You know, we just got out of our private beta literally a week ago, so the timing of this, this conversation, is awesome. Well, I didn't. I didn't work that out on plan and you know we're seeing people coming in and we're starting to get the feedback on hey, this worked, this didn't work. I don't understand this. You know you had a bug here, you had a bug there. I mean it's, it's a beta. Those things are going to happen.
Somil Aggarwal:And so you mentioned having experience working with marketplaces in the past, part of marketplaces incentivizing both the buy and the buyer and the supplier side. Given that you're operating in a space like carbon and then tailoring to SMBs or SMBs, is there anything you've learned from this experience that you weren't expecting going into it, about the characteristics of the buyer or the seller in this, in this dynamic?
Kevin Kyer:A lot actually, and that's the beauty of being in a, in a beta right you get the chance to kind of screw up a bit. So the biggest surprise to the buyers, the consumer in our situation, right, the biggest surprise on the consumer side is the. We went into this thinking like this is just like a next gen platform, so like millennials, gen Z and beyond, and when we started advertising we didn't, we didn't put those filters, we just like turned it on into markets Europe where you know, as I said, it's pretty socially understood and we've skewed greatly older than I would have ever anticipated. Some of our most active people are late fifties, that's not to say millennials and Gen Zs aren't engaged and aren't on the platform. But I thought as we started going up that sort of you know age brackets, it would just start dropping down, and that has not been the case at all. So that was a huge surprise. It's actually very enlightening because then you're like okay, wow, now the you know total addressable market just became something much bigger than we thought it was Then on the demand, on the supply side, so the companies themselves.
Kevin Kyer:So, having been on a board that does solutions just like this, you're constantly challenged with operations and raising capital no different than me as a startup and the biggest surprise on the side of them was it wasn't just an incentive to have capital coming through that is accessible, lower than if they were doing it in their local markets, because when you're borrowing and a lot of arranging markets like the interest rates are crazy. So capital was a big party incentive. But the other idea was the community of people around the world that they now have access to so they can, further down the line, tap into that community as part of a marketing push, as part of a group of individuals that are aligned to what they're doing. And you know I've spent my career in the internet and that's all the internet ever does.
Kevin Kyer:Right, like we can make up all this web one, two, three, five, whatever. We're just breaking down barriers and connecting people around the world, right, and so for them it was really exciting. And then the big aha moment for them and we thought this was like a total no-brainer. Of course we would do it this way. And the big aha moment for them was hey, this is regenerative. So this isn't.
Kevin Kyer:You know, do a deal like you would do, like, say, on Kickstarter. You know, crowdfund my company, I'm going to sell X amount of products and you're going to get a free one or a discounted one when we go live. This is put your money on there, and when you start paying it back and delivering on what you committed to, you can continue to go back again and again, and again, and it just becomes a cycle for you and then for me, as the consumer, it becomes a cycle for me as well. So I didn't just put my money out there six months. Okay, you can always get out, fine, but I get to be very connected. And so they we thought that was a no brainer like, of course, that's how we do it. And they were like, oh, wow, because they compared us to borrowing from from their local banks, in which the process starts over and you go through the due diligence. And so that those were. I guess those are the ones. I'm probably forgetting some there's, but those are the big ones.
Silas Mähner:Hey there, thanks for listening to this episode. If you made it this far, it's likely that you're enjoying the show, so wanted to ask your help. If you're enjoying it, please give us a review on Apple podcasts and share with somebody in the same industry who might find this interesting. And if you're interested in getting summaries of these episodes, go subscribe to our newsletter that comes out on LinkedIn and sub stack Links can be found in the description. Thanks for your help in growing the reach of this show.
Silas Mähner:Yeah, that is quite fascinating, especially if we talk about emerging markets, the idea of getting getting people to realize the that they want to come back to the platform and have like return business. Essentially because during my time, you know, when I went to Uganda to visit my wife's family, it was interesting to see a lot of people kind of very short-sighted, right in terms of how they treat tourists in particular, right, and I'm assuming that there's probably some similarities with business owners and just thinking about the long term and, you know, fulfilling these projects and like building that long term relationship and that trust. So that's quite interesting. And one thing I was going to ask the question, but I just maybe just clarify it instead of spending a lot of time on it, which is why is this important? Right? And just to make sure my understanding of this is accurate, it's important because, as you mentioned, emerging markets have very high cost of capital to get these things done correct.
Kevin Kyer:Absolutely. That's one big part of it, but I guess I break it down a little bit higher up than that, and that is sort of the systems issue, right? So if you're on a climate techie podcast, like you care about the climate, right so that part's good. But then we have to realize that even if there's more VCs, more governments, more individuals putting money into capital than there has been before, it's just flat out not enough, right? I don't know if it's McKinsey or a bunch of people have said that you know, there's this like super big gap in terms of the energy transition. I want to say it's four trillion. I'm probably wrong about that, but it sounds about right. So A it's not enough.
Kevin Kyer:Number two, we say that basically climate finance right now is done by the climate finance elite. So you've got enough money in your pockets either your VC, high net worth, individual, whatever that you get access to these companies. So there's the problem. And then the final one is the capital piece which you were speaking to. So I'm looking at it sort of like as a systems, like the system isn't set up so that the everyday climate conscious consumer can do that, and so then it's important, because if we break down I'm not going to use the word.
Kevin Kyer:If, as we break down these barriers, then we're able to bring more capital, get more people involved into this. And it's really. You know, access is very binary. You know, yes, I have access, but oh, it was a million dollars. Like, there's a lot of platforms that are democratizing climate finance, but when you really look into them, you still have pretty decent ticket sizes. We want it so that pretty much anybody that's got 100, a thousand a month to get into it and therefore, if we get more capital into these solutions, that's that. That to us, the capital is important, but it's also equally important how many people are participating, because that's also going to create an awareness about these solutions and just general energy transition.
Silas Mähner:Yeah, there's a super important aspect on the social side. Yeah, that makes sense. I want to. I want to pivot a little bit now.
Somil Aggarwal:Now we understand a lot of how the technology works and also where the real value at is on both sides. Could you talk a little bit about your roadmap? Now you're in your private beta, as you mentioned. So how are you envisioning this getting to market and then growing at scale, and what do you think are going to be those driving forces? Yeah, so a little over nine months ago.
Kevin Kyer:you know you always get that question what's, what's the scaling factor for you? And you know, investors ask it, partners ask it, and we started going and through my board, through my own network, we started talking to a lot of big brands. And these big brands are like oh, we got to. You know, we got to track Gen Zs, we got to track millennials, we got to do something for the climate, and so they would take your call. And we took a lot of those calls and then after a while it was like, holy, I won't swear, holy crap, we are spending way too much time with these brands that don't know what they want to do.
Kevin Kyer:So we like, okay, real back, real back. Great that this brand has, you know, 10 million loyal followers that engage on a, you know, quarterly basis. Great, that's a nice figure to have. But until you have that dedication and understanding of what can happen and how it works, it just doesn't work. It's just, it's just a total drain brain. So our go to market to answer your question specifically, is direct to consumers for about the next six to nine months, because from that aspect you have proven out how this all works.
Kevin Kyer:You've got a community, you've got loyal users, you have people that are willing to say, hey, yeah, I did that, I liked it. You get some trust, you build some momentum. However, that being said, you always need to think about or I should say I always need to think about what is a capital efficient customer acquisition plan and as much as an efficient as most social media really is. Narrowing down and finding your climate conscious consumer you're you're really better served going where the climate conscious consumer is already. So that can be a website that's only selling climate conscious products, right. It can be an advertisement in a section of a major publication that's completely focused on climate, because if you're reading about it, you probably care about it, right. So we view our go to market as get this whole climate conscious consumer community across Europe super engaged. We will do some partnerships before we do bigger ones, get them loving the product, talking about the product, and then we'll start exploring what are those multiple types of partnerships that that can help us to scale.
Somil Aggarwal:So going through the consumer route, I think generally is considered to be one of the hardest ways to build a company, but also potentially, is one of the most important ways to build a company, one of the hardest ways to build a company, but also potentially is one of the largest ways to get a strong hold on the market where you can capitalize on that. So it's a bit of a chicken and the egg and I think that comes up in a lot of raising conversations and venture too. So in your experience, especially going to VCs with these model, what has been the feedback and also what has been your experience in raising for your company?
Kevin Kyer:Yep, well, that's a loaded question, all right, so what's my experience? I'll focus on that. My experience is we're at the intersection of fintech and climate. Right, so we're using some, you know, clever fintech technology on the background to make things more efficient, more effective, more transparent, and then we're doing stuff in climate. What's interesting is, the intersection of those two investor communities is pretty small.
Kevin Kyer:So if I'm speaking to an investor that's really climate focused, I got to bring them up to speed on the fintech and then, obviously, on the climate side, I got to bring them up to speed or no, the fintech side, I got to bring them up on the climate side. Occasionally, you come across organizations that are understanding how the two of those together are super, super powerful. And in the VC community, I think you guys know, if you're doing what you're doing right now, like things are pretty tight. Right, things are pretty tight. I was at the Crypto Valley Summit last week in ZUG, on stage talking about our solution, and I got an incredible bit of feedback from there and incoming calls and partnerships etc. So good news for us is, you know, climate's not a fad.
Kevin Kyer:You know, it's not like you know, in six months, seven's gonna be like oh, that climate thing. That was fun, wasn't it? It's going to continue to be a challenge. Fintech continues to mature and grow. Yes, it's been around for decades, but it's really starting to get into places where big corporations, individuals, are starting to go after it. We've been successful in raising our angel round a million dollars. We closed back last May. We had one institution participating in that, which is Crypto Valley Venture Capital here in Switzerland, and now we're raising our seed round or I should say pre-seed round at 500K and that's to get us to a full-scale launch. So, yes, the market's not ideal and some VCs are shopping around for deals, for sure, and you can sniff that out really, really quick, because suddenly you start hearing like terms before you've even gotten into any sort of DD and I'm like, okay, I can see what you're going after here, but we're not going to be a good partner to work with.
Somil Aggarwal:Yeah, no, I mean, I don't know if everyone has that experience. I think that it's definitely kudos to you and a lot of the cool technology that you're doing to be able to get people interested just based on the things that they're hearing. So that is very cool to hear. That's definitely not that common. There's one slight tangent that I want to go into, just off of what you said. We've had a guest on the show that has, at the similar intersection of what you would call, probably in air quotes, crypto X climate, and so, based on this niche of all of climate tech and this niche of also all of climate fintech and organizing and decentralizing data, what has been your experience at that intersection? Would you say there are a lot of specialists in this area, or are people starting to kind of see the benefits of crypto and climate and giving more attention to it? Where is that field coming from and how is it evolving?
Kevin Kyer:It is evolving. So, just as little as 16 months ago, if I went to a Web3 conference and brought up that our solution supports the climate, I would get a bunch of head scratching and like, what are you talking about? Like where's my 1,000% return? What are your tokenomics, All this sort of stuff. And then on the other side, when I go to climate events and I explain like hey, this is a fintech solution, they're more open now than just like 12 months ago. So there is an evolution.
Kevin Kyer:I agree with your assessment, though it probably still is pretty early days where the two of them come together. I had an investor just a week or two ago and he's told me okay, so I get what you're doing. You're basically the cleanup crew for Web3. And I like that sort of positioning. I'm not sure I'll use it on our advertising, but it really reminded me that Web3 has a lot of room for growth and a lot of opportunity.
Kevin Kyer:But it still needs to get through this maturity factor of utility over speculation, and I think there's been a lot of grifters and a lot of fraud and people that are giving it that. I can't trust it. If it just has the word NFT, crypto, stablecoin, it's bad, and I think you're gonna now see builders come out of this, especially in this market where they provide real world utility and capability, that anybody sees it and they go. Okay, I can understand that. I mean, I understand everything that's going on in the background, but I feel like this is a solution. I wanna get behind, and I think it's every builder I'm speaking to right now. It's like heads down building. Let's get through this in the next three, maybe six months and then pop out of that with a more efficient, more leaner organization that is ready for when the next sort of bull run starts.
Silas Mähner:Yeah, I do find that quite interesting. I think that the reason a lot of people had such a terrible reaction to a lot of this stuff and at the intersection from especially from climate people looking at blockchain technologies, is there were just so many. There were so many grifters, there's so many people in it. But I heard something recently that was like anybody who's still working on that space after this terrible market for crypto, slash, blockchain et cetera. They are like genuinely, they believe in the technology. They're not just here to make a buck because the the water has gone out right, there's no more. There's no more easy opportunities to make a quick buck. So I think that's pretty interesting.
Silas Mähner:One thing I really I'm very fascinated by obviously with my, my day job being in recruitment is is team right. So VCs we talked to a lot. They always say, especially on the early stage, team is a huge part of the founding, team is a huge part of whether or not we'll make an investment. So could you speak to your experience on you know kind of getting a team around yourself, your co-founders, and how'd you go about finding them and any advice there on on you know, developing a founding team?
Kevin Kyer:So I think every founder's got to. They've got to just look very internally and understand where their own gaps are and then say, okay, I can't do all of this. Even if I think I'm amazing at five of the seven elements I need, you still can't do all of it. And then after that you figure out what those gaps are, where you complimentary, et cetera. The approach that we took and it's not the most I don't know normal approach, one might say For me and my co-founder, oleg, like he comes from FinTech, he's your, you know, typical CTO. Wrote codes since he was in high school, he's very familiar with everything FinTech right, and I have this climate background been on the board marketplaces, digital stuff, was at Yahoo for a while, so we're super complimentary. But then, as you're thinking, the next three months, the next six months, the next 12 months, you got to hire people that fill in a gap.
Kevin Kyer:But I think, if not as important, if maybe more important, is the motivation of the individual that wants to work for you. So if you're a startup and you hire somebody who's like the very best, let's say, creative person on the planet and you just love their work you've referenced them, you've seen their work but they're not willing to crack down a new design for you on Saturday afternoon when you've just spent the entire morning working. That's not the right person in your business. And you get through this in the interview process. You see like, okay, I don't want to burn you out, I don't want to be burned out, but are you in a position where, when things get rough because they will get rough you can rely on these people to pick up the organization, solve for problems? And so when we interview we're really quick to try and unravel that. Like we'll get into all the technical aspects of their background and their capabilities.
Kevin Kyer:But one of the things is are you passionate about our topic? If you are, show us examples of where you've gone the extra mile and then we put stuff in front of them to really test them. I mean it's not like a case study, but we get pretty far down the line to see how resourceful individuals are. Because if you don't hire resourceful people in a startup, all you're doing is guiding them on what to do all the time, and nobody has the time to do that. You know you need to take that product person and say, look, you own this soup to nuts. As a CEO, I will always be involved in every aspect of the product. I have to be, but you need to be able to move when I'm not present, make decisions when I'm not present, always with the mindset of what's the aim of the organization and who is my user and how do I solve for that. So a bit of a long-winded answer to say hire, with a lot of passion.
Somil Aggarwal:Yeah, the way you put it, I think, is really insightful. We sometimes hear founders kind of say, oh, I just need to find someone who knows something I don't. But it can be a lot deeper than that, especially at the founding stage.
Kevin Kyer:For sure and it's funny, your instincts. I mean, I have hired and unfortunately fired a number of people throughout my career. It's always interesting in that first conversation, that interview, you see little signals of things and I'm feeling like my spidey sense is decent, because we had someone nine months ago and I got done with the interview and I did not think it was a good fit. I trusted the technical aspect but I did not think it was a good fit. Personal lasted 90 days, right. So okay, we all make mistakes. It's hard to figure out if it's the right person. You really need to go into it. But there needs to be that cultural alignment and not only somebody that you can rely on to do good work, but you can call them up and talk about anything with them where you can go grab a beer or wine or coffee or whatever it is you drink, right. There really needs to be that because these are your business partners going through some really difficult stuff at times.
Somil Aggarwal:I know the old adage goes the beer test and I think that's used mostly for the founder investor side, but seems like it applies to the founder founder side too.
Kevin Kyer:Not always right. Like, sometimes people are more introverted, and that's totally acceptable in my organization as well, like we've got a few people that just don't have a lot to say. But man, they do a very good work and that's also okay. I think it's just finding the right spots so that they feel comfortable, empowered to do the right work and you don't feel like, oh man, if I'm not watching that, is it gonna go the way I think it should go? And maybe it doesn't need to go the way I think it should go, but that just needs to be good, right.
Silas Mähner:Yeah, this is super interesting. I mean I'd really like to hear somebody else saying this, but it's very important when you're talking about even if it's early stage employees or later on understanding what is their motive and will they be willing to kind of do the work that we need to do, right? I have it in our team that we have people who they just like to show up and get things done, and I kind of tend to be that way. I'm here to get things done while I'm at work. I wouldn't mind hanging out with everybody after work, but it's like I gotta come home and record the podcast right. So you gotta have the understanding of what are the boundaries gonna be, and I think it's sometimes, or very often, overlooked in the early interview process of explaining what that's going to be. But yeah, that's great, I appreciate that yeah yeah, it's a balance.
Kevin Kyer:It's a balance.
Somil Aggarwal:One thing I'm gonna put you on the spot here. You said five of the seven points, so it sounded like there might be a seven point checklist. Is that an actual? Is that hand-wavers an actual sort of metric you use for the things you're trying to cover in your team? Yeah, it was a hand-wash, that's it.
Somil Aggarwal:Okay, was hoping we'd get lucky there. But so the second follow-up to that is you know, finding people is half, if not more, the battle. Right especially, the type of person you're talking about is not only a subject matter expert, but is also someone who is good at what they do, enough to the point that they can be a decision-maker, enough that they can be a thought leader and someone who takes initiative. Like you said, if you ever have to take a step back, they should be able to take a step forward. So how do you find these people?
Kevin Kyer:Why don't I speak straight from what we've done? We have primarily sourced through our network primarily and that comes with, you know, quite a bit of vetting that someone within the company knows somebody and worked with them for a long time and can really give a long duration of experience. Hey, we were together for six years at this organization. This person was excellent at blah blah blah. These are the things I think that they needed to, you know, develop. So we've done that. But then we've also placed just flat-out basic ads and when we've done that, we've also been hugely successful on the volume coming in and in fact I would even argue in an annoying way.
Kevin Kyer:So your inbox just starts flooding with these people because the way we write our description of our business it's very passionate. You know. It's like do you care about the climate? Do you wanna do something about it? Do you have the skills to make blah, blah, blah, blah, blah, blah, blah, blah, and you will naturally get very passionate people that are like wow, you know, I just got done with my master's degree and I do care about that. Or I've been working at this, you know, luxury goods business for a while and man, I don't give a crap about luxury goods, but I do care about the planet, and so you get these really heartfelt emails and reach outs on LinkedIn and other places, but I can't handle the volume of that right. Thankfully, we're not hiring tons of people at the very moment, and the next several months we're gonna need to figure out how to solve for that.
Silas Mähner:Yeah, you can always hire a recruiter. We'll take care of for you. Link.
Kevin Kyer:I've heard there's a few good ones around.
Silas Mähner:No, but I really appreciate that. I think it's actually quite interesting that the point you mentioned just to touch on that, on the writing the job description. A lot of people just like kind of use this canned way of writing job descriptions and it's so stupid, it doesn't really make a lot of sense. But you can make it readable and make it so that they're filtering themselves out, because most people just have the requirements on there and they look and the people are like I'm kind of like that and then they send in their application. Then you have people who are just completely the wrong fit for it. But you can, through a really nice copywriting, get people to take themselves out of the process before submitting.
Kevin Kyer:Yeah, the other side of that silence that I find is funny is when you have a passionate job description and then you get like a chat GPT type response. I'm like, oh my God, like I can't believe you took the time to hit the send button. You have filtered yourself out right away.
Silas Mähner:Man, there's so many people like that. It's unfortunate, but we've got to get more NPCs out of this situation. But we do really want, before we run out of time, to go over your advice for founders. So can you talk about whether that's product finding, product market fit, fundraising, go to market. We already talked about talent, so like what are your most kind of top pieces of advice to founders in the climate space?
Kevin Kyer:Let's talk about product market fit, because without that, the rest doesn't matter. I suppose if we got time, we can go into fundraising too. Product to market fit is the obvious thing. Everybody you know PMF you've got an acronym for it. Now, right, I've been doing that for a long, long time and I still am always learning.
Kevin Kyer:The biggest thing I think I would advise any founder is no matter how basic your idea is and maybe you haven't thought through all the different details the fastest way to get yourself closer to product market fit and I think this is a no brainer and it's obvious, but I'm not sure I'm sharing anything new. But my experience is get something in front of human beings Human beings that maybe you know, maybe you don't know. You know, don't ask your mom and dad, because they're always gonna tell you it's great. But you know, go to those people that are critical thinkers. Maybe they know you, maybe they don't know you. And the sooner you start getting through that, the sooner you understand better what's your customer base, what are their needs, where do they go, what do they like? You start learning who your competition is. I mean, even now you know a year long, beyond a year long, with this business. I come across competitors every week, but then I realize they're not, because I realize what they're doing is totally different, but in the eyes of the customer we are.
Kevin Kyer:So it's a process that I always say if you're asking yourself, then you don't have it right. Do we know our customers? Do we have product to market fit? And so my biggest advice is get it out there, get it quick, get data sit in front of people. Like in our company we do what's called silent interviews. We have somebody holding the phone. It's a friend, it's a random person that's just willing to spend, you know, 10 minutes with you and we say can you use our product, but I'm not gonna tell you anything, but please speak out loud. That sort of insight gets shared across engineering marketing product everybody, and in doing so you start to really narrow down because you cannot be everything to everyone. You know you're not Coca-Cola. You must be very clear about who your customer base is, and the fastest way to get there is an early prototype. And then you iterate, you iterate, you iterate. So again, I don't think there's anything novel in my product to market feedback. I think positive folks would accept that.
Silas Mähner:Are there any particular things that you think about from a climate perspective, like when you're looking at product market fit, because I know you know, generally speaking, if you remove the climate lens, it's just okay. Do people wanna buy your product? But given that it's a climate focus, are there other lenses? You also kind of put on top of this and say, well, maybe people wanna buy it, but is it actually going to be impactful? Any other things that you would suggest there as well?
Kevin Kyer:Oh, specific to climate. Yes, you must recognize that the climate conscious consumer is weary right now and I say that with a global lens, and depending on how much of a climate nerd you are, you might even be more weary that the solution and the platform that you come on to is not doing what you think it's gonna do. So this is actually something that we're constantly working through. So the advice to the founder would be you need to ensure that you're providing trust without being a climate nerd. So I'll be super specific on that. We went through this because that's exactly what happened to us. So we were like super climate nerdy a year ago and we were showing like these bubbles of CO2 footprints and explaining that's the size of your carbon footprint. Nobody had any clue what we were talking about. Like we thought it was so obvious.
Kevin Kyer:But we were climate nerds, right, like we were like no, no, no see, at this temperature, that's what it would be. You know it's bigger than the Eiffel Tower, but it's smaller than this. People still didn't get it. So I think you've got to put things into terminology that someone who cares about the planet but isn't an expert can understand. And then the second part being is give them everything that they need to feel the trust of your solution, and there's varying levels of trust that people will look for. You know it could be social validation, it could be brand affiliation.
Kevin Kyer:You know some people love the fact that we do a lot of our stuff. So what you know, garbage in, garbage out. So I think you have to understand that customer base and then think about what is the right level of climate, whatever it is you're building, and especially if it's like super innovative and you know people don't know what biochar is or whatever you just make it really simple for them and then explain and easy to understand terminology and provide that level of trust, because in the end, that's what it is. You're looking for that user to see your platform. Trust you and trust what you're doing is going to make a real difference towards the climate and it's a tough balance, like it's our tough balance.
Somil Aggarwal:I know we're sort of coming up on the end of the show, so I want to ask probably the show favorite question, just to round it out this is a little bit different. But if you were forced to start a climate tech company today so one that's different from purpose and not anything that's basically purpose but renamed what is the company that you would do, just generally speaking to me, with the problem space you're most passionate about or intrigued by outside of your current company?
Kevin Kyer:This will sound totally cliche, but I wouldn't, because I really looked at so many different climate solutions. Like I knew after my accelerator experience, I knew after being on the board, I knew after sitting down with my board, my investors like this was the solution I could get behind and I liked it. We've evolved, like it hasn't always been exactly how it is now In climate. This is what I'd be doing. My biggest thing I would say I wish I would have done is I wish I would have done this five years ago. I really do, because I think that these things take some time to get the flywheel spinning and things going there. But I've always worked in companies where you're, like I said earlier, you're connecting people with something they didn't have before, and I've always loved those sort of solutions. So I'd need to rethink that maybe there's some other connection I haven't thought of within climate and that's probably what the evolution of our product will be is some other connection that we're not doing now that maybe works in certain parts of the world or works for a certain customer base.
Kevin Kyer:But I just like I don't have anything, for example, against carbon credits. But I would tell you I would not go into carbon credits. I'm definitely not playing that space right now. It's great there's lots of money there. It's great that the funding happened a year or year and a half ago. It clearly needs to be cleaned up. But it's not like I'm looking at the carbon credits market going. Oh damn it. We should be doing that.
Somil Aggarwal:We can tell you from experience you're definitely not alone in that. You're definitely not the only one saying that Is there. You know, I totally. If anything it sounds really really cool Like this is you had sort of that broad view of a lot of different tech, so you chose this one. Was there anything that you were any areas that you were bullish on when? Yeah, maybe I wouldn't build in it, but I think it's a growing area. I think it's an area that it's worth getting into.
Kevin Kyer:In climate.
Somil Aggarwal:Yes.
Kevin Kyer:Oh, look, if you've read Bill Gates book, which the frigging title is escaping my memory right now, you know one of the messages in there is the green premium and how so many of these things it's like any new technology has this extra price. You know, electric vehicles is a good example of that. I think that we don't know what that next energy transition solution is. You know, I listen to people talking about hydrogen. That's blue, that's green, that's dirty. I don't understand all of it, but I continue.
Kevin Kyer:I'm like super climate curious and sort of nerdy in that sense I go to these things and I learned about that, or like I didn't know what biochar was 12 months ago. So I think there's there's new stuff coming out there that needs that injection and needs innovation and lots of capital to make the possibilities there for all of us to suddenly go like, yeah, of course I drive a biochar car. You know like why would not? So I wish I knew what those things were and I'm like super optimistic that the right smart people and the right smart capital is gonna get into and make those things happen. And you know, maybe one day we're in a position at purpose where we can help to get capital into those newer sort of things that can make a massive difference. But it's gonna take some time to get there. But you know, like you know, energy transition is what's the problem, right, it's what? 73, 75% of the problem right now. So we've got to just buckle down on that or we're in trouble. Fair play. Well, I appreciate you sticking to your answer.
Silas Mähner:There, I believe the book is. I believe it's hard to avoid a climate disaster. I think is what the title is. But anyways, final thoughts. Anything, and it calls to action to the audience. For you to end things up here.
Kevin Kyer:Yeah, one would be. You know, go to purposewithayyio, give it a try. We are in beta. It needs, you know, users and feedback and you can always.
Kevin Kyer:I believe we have a little button where you can reach out to me if you're curious to know more about how we work and what we're doing. And then I would say everybody else that's in the climate space like, keep up the good fight. You know, I love when I reach out to climate founders and they take my call and vice versa. You know, I'd say a couple of times a week I learn about some other climate founder out there, what they're doing, and it's amazing how open the entire industry is. Like I met a guy a few weeks back called himself a space farmer and then I understood what he was doing and I'm like man, I am so inspired by you, right? So I think anybody that's doing climate tech it's gonna be a slog, but you're aligned to what we can all do. And what's gonna be super cool is when a lot of these climate founders grow up and we're all like working together and helping each other. You know there's probably some mergers and acquisitions down the line, right, I do think about that a lot.
Silas Mähner:I think that's quite interesting. First of all, a lot of people are very open, but also it's like the new Silicon Valley, like there's all the old people who were. They were there, they have the big names and everything, and you see people like Chris Sokka who've transitioned to climate now and obviously he's gonna be in both camps, but there's a lot of people who were not in the first camp and I think that the thing I'm optimistic about is that climate, because of its alignment with ESG, will be a much more inclusive space and not just like this Silicon Valley kind of.
Kevin Kyer:You know tech bro's club yeah, it takes all.
Silas Mähner:Where you have to be from, the space you have to grow up there, hopefully a little bit more distributed. Being somebody from the middle of nowhere in Wisconsin, that's something I think about. You know, hopefully we have a chance at this stuff. So, anyways, I really do like that. So I appreciate you coming on and it's been a pleasure.
Kevin Kyer:Hey, thanks for having me guys. Super cool, I enjoyed it as well. The Lawn Mower
