CleanTechies Podcast

#150 AI Fund Operations, Canada x Climate VC, "Growth-as-a-Service", & More w/ Nick Findler & Chad Rickaby (ClimateDoor)

January 24, 2024 Season 1 Episode 150
CleanTechies Podcast
#150 AI Fund Operations, Canada x Climate VC, "Growth-as-a-Service", & More w/ Nick Findler & Chad Rickaby (ClimateDoor)
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Show Notes Transcript

Climate Tech founders needs lots of different financing options and styles of support – ClimateDoor is an example of a niche’d styles of venture support that I hope we see more of in ClimateTech VC.

ClimateDoor is a style of venture builder called “Growth-as-a-Service”, functioning similarly to a late stage accelerator.

We dive into the nuances of their model, the Canadian VC ecosystem, what its like founding a company with your childhood best friend and more.

Enjoy the episode! 🌱🌎
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Topics:
**00:00 Introduction and Background
**07:14 Overview of Climate Door
**13:27 The story of Polar Beer Taps
**16:10 Advantages of "Growth-as-a-Service"
**23:24 Canadian Venture Ecosystem
**26:20 Blending Capital Sources in Climate Tech
**29:30 Navigating Fundraising and Building Investor Relationships
**35:01 Streamlining Operations with AI
**39:51 Hiring Advice for Early Stage Companies
**42:57 Fundraising Advice for Bridge Stage Companies
**49:03 Challenges in Finding Value Spots in Climate

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Links:
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Nick Findler | Chad Rickaby | ClimateDoor
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**@Silas & @Somil_Agg on X 

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Somil Aggarwal (00:02)
Alright, welcome to the show Nick and Chad, how are you guys?

Nick Findler (00:06)
Doing great. Thanks for having us.

Chad Rickaby (00:07)
Awesome. Yeah, thanks for having us on.

Somil Aggarwal (00:11)
This is our very first dual interview. I don't think any listeners have ever heard this from us before, so it'll be fun. I'm excited if there are some technical difficulties for the audience, honestly part of the experience. And honestly no better recording to have to end the year. This is our last recording of the 2023 year. So, super excited to have you guys on. Been a long time coming.

Nick Findler (00:36)
Yeah, it's great to be here. Thanks for having us on. I'm really excited to dive into things and big fans of the show. And yeah, just honored to be one of the new episodes or I guess the last one of 2023.

Somil Aggarwal (00:48)
Appreciate it. Where are we finding you guys today?

Nick Findler (00:53)
Both of us are in Vancouver, Canada at the moment, which is actually my first, feels like my first full day back home in months. So I'm back in my condo downtown. I think Chad, are you down here as well?

Chad Rickaby (01:06)
Yeah, I'm downtown in our office just down the street here. So, yeah, rainy Vancouver.

Somil Aggarwal (01:13)
I remember I was actually mentioning to a friend after we spoke once chat about Vancouver and sort of the tech scene and the center of it all. And they were surprised to hear, they are Canadian themselves. They were from, I think Mississauga, Toronto area. And I told them about the climate tech scene in Vancouver and everything you were telling me about. And they were surprised too. And I was like, you're interested in climate tech. I feel like you should know this. But ever since then, I've remembered that significance quite well.

Chad Rickaby (01:39)
Yeah, there's a unique scene here. It's still quite small, but it's growing quickly and we have some unique factors in the province that make it an exciting place to scale climate tech companies for sure.

Somil Aggarwal (01:50)
Yeah, well before we get into the good stuff, please Nick and Chad, introduce yourselves for the audience. Who are you and what do you do?

Nick Findler (01:58)
Yeah, so I'll go first. My name's Nick Finler. I'm one of the co-founders here at Climate Door. My pathway to this business has been very entrepreneurial in nature. I was the kid selling garbage bags and doing pressure washing and picking up golf balls and selling them and really spent.

A lot of my formative years learning everything I could about business, fast forward into my early 20s, went to the University of Victoria here, studied commerce and entrepreneurship and really started getting into the venture capital and business building scene in my early 20s. Took a number of companies public, financed a number of early stage businesses, both myself and sort of my...

core network around me and found sort of near the end of that journey in my mid-20s that the climate tech was really the area where I saw the biggest opportunity for impact, the biggest opportunity for financial returns, and really the biggest opportunity to build a long-lasting brand that was focused in a really pivotal area. And so that's when I teamed up with Chad. And Chad, maybe I'll let you take it from there.

Give a little in-try on yourself.

Chad Rickaby (03:14)
Yeah, awesome. Yeah, so I'm Chad Rickby. I'm the other co-founder and CEO here at Climate Door. And my journey's much different despite growing up with Nick. While Nick's journey came through all things business, mine was all things government. So while Nick was selling garbage bags, I was probably reading the news or something like that. And that path led me into a master's in public policy and global affairs at the University of British Columbia here in Vancouver.

And through my sort of early to mid 20s, I was working sort of in and around the government, helping them sort of support or at least try to support the innovation ecosystem through different programs and policies. And so became quite familiar with the different ways that happens and sort of where that type of support can come for different businesses and similar to Nick's.

sort of journey, you know, really finding through both my studies in sustainable development, but also through the work with the government that really the intersection of that government support and private capital is really the most acute at, you know, sort of in the climate tech space. And so that led us to team up and start Climate Door.

Somil Aggarwal (04:30)
Besides the opportunity itself, was the innovation you were supporting at all related to climate or sustainability innovations?

Chad Rickaby (04:40)
Yeah, so the innovation policy that we were working with at the government level was at all levels of government and they were most interested in supporting the sort of climate and clean tech innovation and in particular it's important in Canada because we have a quite carbon or high carbon intensity sort of economy here so there's a lot of interest in places like BC, Alberta to really think about.

how climate tech can provide opportunities for innovation and entrepreneurship while also solving some of our complex challenges and giving us a hope at meeting some of our targets. So yeah, most of the innovation policy I was working on was supporting growth in the sort of climate tech ecosystem.

Nick Findler (05:27)
Yeah, and similar to Chad, you know, my last few years before starting Climate Door, I really found myself, you know, I'm a pretty hands-on VC and found myself really digging into climate-focused businesses. So the sort of last two businesses that are now, you know, very involved in Climate Door were, one, a solar franchising business called Startup Solar, which we supported and still are supporting to this day.

on a really interesting mosquito disease technology that was definitely having an environmental aspect to it and it didn't use pesticides and had a really...

um, you know, novel way of solving malaria and dengue. And, and so that was really sort of, you know, getting my hands dirty with those two businesses and getting involved and then sort of having conversations with Chad about all the work that he was doing from the government side. I said, you know, it makes a lot of sense for us to sort of team up sort of my capital markets and understanding how to finance businesses and Chad's understanding of how to really navigate the government landscape. And together we sort of take this sort of blended finance.

approach to supporting early stage businesses and how to de-risk them and how to make investors' dollar stretch even further with the help of and the subsidy of government getting involved.

Somil Aggarwal (06:48)
And being shy with friends doesn't hurt, I'm sure. Very cool. Well, you know, I think you did a perfect segue into the kinds of ways that you approach investing and that's no doubt related to Climador. Why don't we jump into it? Can you explain what is Climador for the audience? I know we have curated a lot of really cool things to talk about, but just an overall high level overview of what is Climador.

Nick Findler (07:14)
Yeah, so, so climate door is really a venture growth builder. And so we partner with growth stage climate related ventures. And so when I say growth stage, I'd say, you know, we're

We sometimes get involved in incubating ideas, but often we're right after the incubation phase. They found some kind of product market fit. Normally it's very early. They're looking for capital. They're looking for tools to grow. They're looking for often a sort of business team to come in and help them scale that side while they focus on the actual technology or solution. And so that's what we do. We call it growth as a service.

really all things business, all things capital, customers, and tools to help them grow. And so that's, that's really what, what climate door is in, in that shell.

Somil Aggarwal (08:09)
Got it. And so, you know, I would love to double tap on that. I know when I first came across this, I had a lot of questions about it. What is growth as a service? You know, for the audience, there's five different offerings that are part of it and or six, actually. And so those are business development, capital raising, government funding, I implementation, which I think is really cool, growth marketing and ESG consulting. This is all from sort of the information that you put out there. Could you just talk through if I'm a company?

host incubation, found some product market fit, how am I working with a growth as a service model?

Chad Rickaby (08:45)
Yeah, I can add to that and really building on Nick's description there. I think the real sort of unique offering there is that it's six different things that are all very applicable to the growth stage of these companies, that are applicable to companies that wouldn't be able to have that, have one person for each of that. So they're at a growth stage. They're not going to be able to have a business development person, a capital raising person, a government relations person.

all of these things are important and they all fit together. And so really the sort of where Nick and I came together is really understanding that these things fit together and that they need to happen in parallel and that governments wanna see matching capital from investors and investors wanna see revenue from potential clients. And so the business development side is key and a lot of these technical founders don't have time for that or the skills for that. And so thinking about

where we can use AI implementation and different growth marketing tools to build that trust with investors or to tell the story to government. All of these things are really key. And as a technical founder in a sort of C to Series A sort of stage where you might have maybe a co-founder or two, you probably are trying to do all of these things at once, also whilst iterating on your technology. And so that's really the sort of inception of the idea that really through

you know, hundreds and hundreds of calls that Nick and I had with early stage innovative businesses. We really came to the conclusion that these things fit together nicely. They each piece requires each other and that most early stage businesses can't do this on their own. So so that's really the crux of the growth as a service model.

Nick Findler (10:33)
Yeah, maybe just maybe to add on to that briefly, and I think Chad did a good job summarizing it, you know, companies, as Chad said, just can't afford to hire one person in each one of those seats. And so we offer sort of a fractional approach. But but really with, you know, as you mentioned, and I'm sure we'll get into the AI stuff at some point in the conversation, you know, I think one of the

the most beautiful components of AI is that it really allows you to stretch your capital efficiency. And so, that's our goal when we come into a company is how do we make this investable? How do we make this financeable other than just Chad and I and our team financing it? How do we make a company have better unit economics than maybe an investor's alternative? And so I think that's one of the biggest challenges, especially in the growth stage,

space is that you know the they're just not de-risked enough and the potential ROI for an investors is often not strong enough and I believe that a lot of early stage businesses lean on the fact that they're good for the planet or They're good for humanity and that investors are gonna write checks because of that and that is just not the case

and investors are looking for returns. They want to feel good about their investments, but they're looking for returns at the end of the day. And so our job is really to come in and help advance these businesses as capital efficiently as possible.

Chad Rickaby (12:05)
Yeah, and I think to add to that, the one other piece that's quite, I think quite unique to the climate tech space is a lot of what we just said probably would apply to early stage businesses in other spaces as well. But I think the other thing that's challenging to Nick's point on de-risking, it's very time consuming, especially in climate tech spaces because of the sort of mixed element of it with different types of partners and really sort of creative capital stacks where you're mixing government and you're mixing

potential philanthropy or industry partnerships. In Canada, indigenous communities are a big part of that. And so for a founder to try to think about how all these things fit together so that they can de-risk it and then perhaps take it to traditional VCs, that's a lot of work and it requires you to have your finger on the pulse of a lot of very different things. And so that's another sort of important element of this is that we're able to help them think creatively so that.

as Nick said, when the sort of traditional investors that want to see that ROI understand how all these different partners fit together and the sort of de-risking journey that got them there.

Somil Aggarwal (13:13)
I think it'd be great to hear this in a story. So what is one of the early signs that growth as a service that your model was working? Do you have any early stories about you saw this in action and you're like wait I think we have something here.

Nick Findler (13:27)
Yeah, maybe I'll take that one. I think a really good illustration and it also illustrates the types of businesses that we like to work with and is a company called Polar Beer Taps. And you probably hear the word beer and climate and you're like, what, how are these two things related? And so we teamed up, I guess it was about seven or eight months ago now with a, with an awesome actual local team that's created a brand new

proprietary machine that delivers cold beverages and is really solves a lot of problems outside of the restaurant so festivals, weddings, catering events and what we saw early on was the energy efficiency

of this creation that they'd made. So they, you know, essentially what at the end of the day, for every keg of beer or wine that's poured through this machine, there is the CO2 equivalent savings of a car driving down the road five kilometers. And so it was a small team that built this proprietary machine. It was clear to us after doing a lot of market research and pretending to throw our own.

festival and sort of testing out what the other competitors were out there doing. It was clear to us that there was a clear environmental impact to this machine, but what the team lacked was, you know, they didn't have the resources to figure out how to capital raise, how to start meeting customers, you know, how to get their first government funding, you know, how to actually calculate what their ESG sort of emissions and the savings so that when we went to investors, we could be very clear about like,

dramatic, you know, GHG savings from...

you know, using a solution like this. And so our team really sort of bolted on to their core management team and became large shareholders and now, you know, work extremely actively with that business every day. So I think that's a, you know, we helped them build their website. Like we really helped sort of all of the things outside of the, the technology and the, the running of the everyday business were involved in sort of all things growth and business. So maybe that gives a good example of, of how it all comes together.

Somil Aggarwal (15:44)
What do you think was the real value add for an early stage company that's different in your position versus like what a traditional VC offers? Because obviously you've outlined how some VCs aren't ready to understand the kinds of offerings and nuances and you help with that. But from a founder's point of view, when working with this company, was there anything in specific that they were like, wow, like this is really different about you guys, this is really unique?

Nick Findler (16:10)
I think we're good. We're we're what VCs used to be. And so

You know, VCs now I think are, and I don't want to speak broadly across the whole gambit, but you know, VCs nowadays are really just capital and capital with a lot of strings. And so we're sort of a blend between we'll finance you, we'll put our own money in, we'll bring in sort of a core network of investors alongside, but we're really, you know, a hands-on growth team. And so, you know,

we talk to some of our clients and they've hired lots of consultants in the past that are supposed to do these things, but you know, they're just looking to collect their $10,000 check every month. And then you don't hear from them for three weeks and like your website is supposed to get done and like you're supposed to have a pitch deck. And so, you know, it really puts us in a different position because you know, we are owners of the businesses and you know, we care like,

we're so happy to go above and beyond what sort of the traditional consultant would be brought in to do these sort of growth services for them. Because at the end of the day, that's the only way that Chad and I and the rest of our team make money is that the business has true success. And so I think that's really what makes us unique is that our incentive alignment is extremely clear and it's extremely aligned to the founders that like our success is their success.

success is our success and we really just become one team. And so I think that's what really makes us unique is that, you know, you can call us on Saturday at 3 p.m. and if something needs to get done, like we're the first ones to pick up the phone and get going, like we're not, we don't work nine to five, we don't work Monday to Friday, like we really care about impact and care about working with great people and we wanna be the resources and the extra horsepower that they need.

Chad Rickaby (18:01)
Yeah, and I think in addition to that, very well said. And I think the other thing that the incentive alignment does is allows us to approach it with a long-term mindset where we're really thinking about building a strong foundation for long-term growth, which is not possible under a standard consulting model where you're getting in there, seeing how quickly you can get your scope of work done and your paycheck and out. This partnership model really allows us to think long-term about...

what they really need, what's gonna build the foundation for their growth and especially in something like climate tech at an earlier stage, this can sometimes take a little while for it to start humming along. So that's another important piece of the model for sure.

Somil Aggarwal (18:49)
I definitely understand that. I think there's been a large sentiment around VC kind of shifting to being more financially incentivized rather than growth incentivized. So just kind of, again, making sure that their cap tables are set and kind of moving on. And it's allowed for a lot of CVCs like corporate VCs, venture studios, growth as a service, for an example, to kind of step in and provide that more hands-on mentorship, especially in climate where it's not SaaS.

where you have enough like recurring IPO founders to kind of repopulate the ecosystem, everyone kind of doesn't have the answer. And you've seen a lot of like unfortunate bankruptcies recently, Bird is one, Veev is another, right? And so you see this ecosystem that clearly hasn't been cracked yet. And I think a lot of founders are trying to understand that they need more help than just their, you know, check writer VC traditional, you know, financing model. So.

Yeah, I appreciate the detail there and the clarity on that.

Nick Findler (19:49)
I think that's a really strong point you made is that none of us on the call here have any experience in true decarbonization and so no one has ever done it. And so there's a lot of first time people to the space, there's a lot of people that are building new business models that have never been built before. And so we're...

you know, trying to add as much sort of horsepower and know-how and bringing together sort of a broad set of skills to help these businesses figure out that path.

Somil Aggarwal (20:25)
Definitely. And now that we've set the scene, I actually would love to kind of fill out the big picture. Starting with Chad, you have a background, like you mentioned, political science, government, policy, and even some of your experience in international markets. How does that inform, especially when you're advising these companies now that we know how hands-on you guys are, how does that inform your view of climate and climate tech today?

Chad Rickaby (20:50)
Yeah, it's an interesting question. The answer probably changes every day. But I think fundamentally, it allows us to come at it with quite a holistic view in that policy and political science and international relations really help us understand what is happening at a sort of meta level. And in climate tech in particular, again, it's not SAS where it's pretty clear what you need to do. Climate tech is very influenced by

global agreements at COP last week and, you know, IRA policy changes, all of these types of things are very important, particularly in climate tech, which is largely driven by policy and supported by government funding. So that's certainly a big part of it. You know, even thinking about government, not just at the sort of big meta level, but also

all levels of government, right? You know, even municipalities are often first clients for people, whether it's waste tech or water tech or, you know, reducing emissions of their fleets, you know, so thinking right down to municipal governments. We work a lot with Indigenous governments who in Canada in particular are really leading the charge towards net zero. And so, again, really thinking about all levels of government from international all the way down to local governments and.

And I think the international market experiences is interesting as well for early stage businesses, which generally don't think about that stuff as early as they probably could be. And so, you know, thinking about, you know, if you have a sort of vertical farming solution, Singapore is probably an interesting place. You might want to test the market, whereas if you have a, you know, geothermal technology, you're probably looking at a place like Kenya or, you know, Scandinavia. So, you know, really thinking about.

where these products might go in a few years down the road can really help them sort of apply some of that potential and then even seek investors from those markets. So we've had a lot of success helping people think through opportunities in Singapore and that's certainly a place where capital is moving. And so, really thinking through the world as your market and...

I think can be quite unique for early stage businesses, in particular in Canada where we don't have a great track record of thinking internationally, or at least beyond the United States. And so it's an interesting value add for sure.

Nick Findler (23:23)
Sounds

great.

Somil Aggarwal (23:24)
Definitely, yeah, definitely. And I also want to add on to that maybe the point that I really wanted to talk about, especially going into this, you talked about the Canadian venture ecosystem. I got to learn a lot about it through some of my technology investing, especially evaluating the market size of different FinTech solutions in Canada, how the banks interact there, how PropTech works there. Through that, I learned a lot of the intricacies behind.

Some of the differences between how growth happens in Canada and the Canadian ecosystem versus the US. Honestly, just top level, I would love if you could break that down and go into whatever areas you're passionate about. How does financing work in the Canadian ecosystem? And also, where does climatic fit into that?

Nick Findler (24:10)
Yeah, maybe I'll take that one. You know, the Canadian financing ecosystem, I think is very heavily tied to the US. And so we work with, you know, a number of US companies, we work with companies from Europe. And so really gives us a good understanding of sort of what's happening in all sort of facets of sort of global finance. And that's why we spent, Chad and I just got back from COP in Dubai and really wanted to get a sense of, you know, what was happening.

what different types of capital stacks were happening around the world, what was successful. And so, you know, here in Canada, you know, one of the, you know, the blessings and maybe a curse also for these early stage businesses, there is a lot of government support here.

And so we often find that companies are, can become too reliant on government and they get into this sort of hamster wheel of chasing the next grant or the next subsidy or the next rebate and don't spend enough time building their business. And so we actually, that's one of the things that when we get brought in, we try and take all of that thought away from the founder or the founding team that we can handle that all for them. And so, you know, often, you know, and there's a, a fairly vibrant angel scene here.

It's definitely nothing like the US. There's definitely, you know, a bit more sort of small, smaller thinking here than we see from some of the investors in the US. But, you know, that's why it's so powerful to take this sort of blended finance approach where

you know, we can approach investors and say, look, the, the Canadian government or the British Columbia government is willing to, you know, put up two or $3 million if investors match the rest. And then we can go to investors and say, look, you know, if you put a dollar in the company is going to get $2. And that's going to make your investment stretch much further.

it's going to make the company have to dilute you less. And so that sort of melding or blending of both the private and non-private capital worlds is, you know, extremely sort of important and probably unique part of the Canadian ecosystem.

Somil Aggarwal (26:20)
Do you think that blending has taught you certain things about climate that is an advantage in the way that you advise companies? The reason I ask that is because I think it's one of the major challenges of capital providers today, which is understanding how do you navigate the climate capital stack? A very cliche repeated term. And so what I have talked with a lot of guests here, there's some guests with experience in developmental finance, for example. And that's an area where you had already philanthropic dollars de-risking.

innovations for private investment, and that actually has a lot of parallels to climate investing. So I'm wondering if any of what you're talking about has prepared you for investing and supporting innovations in climate.

Nick Findler (27:04)
Well, you know, we're part of our everyday mission and activities inside the business in Climador, really figuring out...

what, because capital knows no borders, right? Like the business, that was one of the really interesting things from COP was that Canada has a great brand. Internationally, people see it as a very stable place with sort of predictable policy. And so, we're constantly looking for what are the best ways to finance businesses. And so you can look at, we're talking about the capital stack, I think one of the interesting.

new entrance to that capital stack is crowdfunding. And so we're starting to see crowdfunding be extremely prevalent, especially in the climate economy where the everyday person, the non-accredited investor, wants to feel good about their investments and they don't often get opportunities to invest in early stage businesses. So you see early stage climate businesses really taking advantage of that. You look at a great example of that is app Terra.

who's created an EV car concept. They've raised 85 million US all through crowdfunding. And so, constantly looking at what are the different pieces that can be put together to finance these businesses, especially at their early stage, while they're still trying to prove their unit economics. I don't know if that answers your question, but I think that the capital stack, at least for the time being until

you know, these businesses become more capital efficient and better ROI investment opportunities. They sort of need that broad stroke and sort of all the different pieces coming together to make it all happen. And a quote that I love is like, there's no silver bullet for financing these early stage businesses. It's really, you know, a million different golden BBs. And so figuring out how to pull all those together and finance these companies is integral.

Somil Aggarwal (29:07)
I think it's been great to hear what you guys do in action. I actually do want to actually double tap on that a little more. You talked about, I think you talked about your success rate, about how it proved it. How about some recent instances where you've navigated this kind of fundraising environment, been there for companies? Do you have favorite stories of yours that are top of mind?

Nick Findler (29:30)
Yeah, so we mentioned the polar beer tap story, which has been, yeah, an extremely blended approach we have, you know, on the capital table, we've got sort of early stage institutions, we've got friends and family, we've got early angels, we've had some government money now there's now the Canadian banks are putting debt together. And so it's really a blend of sort of all of those pieces all sort of de risking each other.

Another great story, I think a company I mentioned earlier started a solar and so that has been a blend of sort of private capital from angels, but we've actually found that the public markets have taken quite a bit of liking to the company, so we're, I don't think I can announce it yet, but there's, we're about to take the company public and have been preparing for the last six months, and so.

Yeah, we really try and have our finger on the pulse of all of the capital sources, especially in a time where financing and money is not moving as freely through the system as it was a few years ago. We need to make sure that we're tapping the shoulders of sort of all of the interested incumbents that are in the system.

Somil Aggarwal (30:46)
And how about you, Chad? What do you have a favorite different story of yours of a process you guys have gone through?

Chad Rickaby (30:54)
Yeah, I think that those are the two most recent financing successes. But I think there's been lots of other successful initiatives that financing might be the next step, but where we've built some really interesting partnerships and are really helping companies think through how their technology fits into different supply chains or how it can be combined with other climate tech.

One example of that actually is a program that we're running for the European Union, where we've been matching EU tech to Canadian buyers. And it's been very interesting because the European Union is quite a bit further ahead in the climate tech ecosystem than certainly Canada and on all of North America, I would argue. And so that's given us a really interesting chance to think about, you know, how these different funders fit together, how these different investors might be interested in.

different types of project financing versus actually investing in into companies, which is two very different things, of course. And so that has led us to building some interesting partnerships that I think are going to be looking for funding in the new year where, for example, a carbon capture technology out of Alberta that we're working with that is now partnered with a company out of the European Union that turns that carbon into clothing like fiber.

for clothing, so a net negative clothing company will come out of it. And that's a very cool example of where we've been able to use our understanding of the whole ecosystem, our availability of funding, where we're gonna pile in some capital to that to really make some interesting and impactful and hopefully profitable projects come out of this. So.

That's another story to add just a bit of a different color to the sort of financing world.

Somil Aggarwal (32:52)
The zero carbon clothing, that's really, really interesting. So is that, I actually just want to ask about that a little bit, is that process itself weaving in the carbon capture technology to the actual textile production, or is it somewhere elsewhere along the process?

Chad Rickaby (33:07)
Yeah, so at this point they would use the carbon and then make fiber that is then used in clothing production that they would probably outsource to a different part of the value chain just to keep the economics making sense in terms of where you can make clothing a little bit cheaper than Canada. But yeah, the actual inputs and material the clothing is made out of is from captured carbon.

which is interesting. And again, a really interesting example of us understanding that EU technology and then knowing the Canadian ecosystem that if you're interested in Canada, the best place to be doing that is Alberta, where they're leading, Alberta, Saskatchewan are leading probably the world in carbon capture, certainly in Canada. And so thinking about how they fit together, where there's government funding, where some of the...

as you said, corporate VC, especially from oil and gas in Alberta, would be interested in supporting that. Really putting all of those pieces together has been an interesting example of where the sort of growth as a service and really blended skills that the team brings can lead to some pretty interesting outcomes.

Somil Aggarwal (34:21)
Very cool. Yeah, I think that isn't a field that you'd see a lot of that kind of innovation in or expect it because I think there's a lot of upcycling, recycling, you know, reuse kind of conditioning in there. I actually, I will be, I'll look into this after the show. I didn't, that's really cool. Before we pivot to sort of the last sort of recaps and advice part of the show, you brought up AI. So I want to thank you for letting me talk about this buzzword because it's always fun.

But Nick, I think you'd mentioned that AI has involved in your operations and allowed you to streamline and make things more efficient. Can you just talk about what that's like and what specifically you're doing with AI?

Nick Findler (35:01)
...

Yeah, so about eight or nine months ago, I had been playing with chat GPT for about a year at that point. And I thought I'd signed myself up for a little weekend course on how to use AI in your business. And it really dramatically shifted my opinion and sort of perspective on how AI can be influential, both in our own business at Climate Door, but in all of our portfolio businesses. And, and really.

That journey led me down studying at MIT for a little bit and thousands of hours of YouTube videos. And so what that is culminated into is a team of what we call eco-pilots. And so they are...

AI built co-pilots or algorithms or through the use of chat GPT that help maximize our efficiency inside of our business. And so there's about 50 of them, of these little characters, they all have dames. We don't like to call them robots internally, but they're really, their assistance in sort of our everyday tasks. So anytime that I find myself doing a repeated task or something, you know, as simple as writing case.

or helping answer emails or building investor decks or analyzing data, we have specific AIs that have names.

that we use internally, then I've found that both the, I can speak for myself, the productivity level or, you know, my output is at least three to five times greater than it was previous to really understanding AI. And when I say really understanding AI, like understanding the first inning of it, and then also the sort of quality of output.

goes up significantly as well. So we started to see this as a, you know, you can take a marketing team of one or two people and make it feel like it's 10 people. And so this really lends itself to our growth as a service model where we're trying to help these companies be as capital efficient as they can be. And so that's sort of been our journey through AI thus far.

Somil Aggarwal (37:22)
What specific process do you think AI has been best able to streamline, replicate, substitute?

Nick Findler (37:31)
Analysis of data is a big one.

Um, so for instance, you know, when we're thinking about marketing and how to speak to our audience, we are con we're in this constant feedback loop of testing new things, seeing how it works, feeding that information back to the AI and having it come up with new ways and new approaches that we should be thinking about it. And so that's helpful from a capital raising standpoint, it's helpful from a government funding standpoint. So really that sort of, um,

We call it the climate loop. We've got a whole acronym, but like essentially it's you ask the AI for the questions you want that it needs you to answer to best help with the task that you're trying to solve. Um, you answer those questions back to it. It tells you what your, your sort of game plan should be. You go execute across that game plan, you feedback the results, and then you ask it more questions. And it's this con. So that, that feedback loop of analysis of data and sort of, uh,

project planning I think is incredibly vital.

Somil Aggarwal (38:38)
I think there's been an understated, or at least less mainstream benefit to generative AI technologies is the feedback loop. Even in writing and communication, when you're trying to write something convincing, write a memo to other investors, anything like that, feeding something like this into an LLM, chat GBT, whatever it is, and getting feedback on what, you know, what are the weak points, strong points, what are the message, I think is a huge gut check that wasn't, you know, really possible a couple of years ago. So I definitely resonate with that value add.

pretty greatly. Well great, you know I think we're coming to the last portion of the show. As two people who work, inspire, and innovate with a lot of early stage companies, I think we have a lot of questions about advice that you're seeing and I think it'd be really interesting to also get any nuances that you have within the Canadian ecosystem for any, you know, I don't know if our listening is that big in Canada, hopefully it will be bigger after this, but any nuances that you could give in that regard. So I want to start with talent.

So you talked about, and this is a tribute to Silas, who's the co-host, and he's big on talent. What is your general process recommending or advising your companies on hiring? What are you telling them and what are you looking out for?

Chad Rickaby (39:51)
Yeah, no, I think it's a very interesting question and I'd caveat it that we'd be advising our companies specifically on hiring sort of on the business side of things, so we wouldn't be advising on hiring the next engineer or technical person. And so, I think we sort of have a ranking of three things that we try to prioritize internally and then suggest our companies.

do the same thing. And so the first priority being sort of passion and drive and really making sure that they care is sort of really the first criteria. It's very, it's often easy to see right off the start, like do they give a crap? Do they care? And so that's the first one. The second one that we really prioritize and suggest our companies do the same is inclusion and diversity. And this is both in terms of lived experiences, but also

perspectives, the diverse perspectives in terms of professional backgrounds, academic backgrounds, all of these things are key to growing the sort of business side of a company. And then the third one, of course, is skills and knowledge and experience. But we put this one third largely because we believe that this can be taught and in some cases, you know, expanded on and customized to the needs of that business. And I think it's also

you know, important, you know, relating back to what Nick said, that nobody really knows what decarbonization or the path to net zero looks like. And so, you know, companies that are really passionate about that, making sure that there's that shared passion, that diversity of experiences, and then building the skills required to do that on the fly is something that we always recommend that can be a model. So, yeah.

Nick Findler (41:47)
Yeah, one thing I'll add to that and one thing that I think is that sort of plays off what Chad said is early evidence in a new hire that they can learn and implement. And to do that consistently that they're not just relying on their

bachelor degree or their master degree because there's so many nuances in growing a business especially one in the climate space that you're constantly throwing yourself into the deep end of Watching YouTube videos or learning or reading a book and like 10 people learn and implement Quickly so that they can develop that skill set as the landscape is changing I think is a really critical piece of hiring

Somil Aggarwal (42:32)
The next thing that I would love to ask about is fundraising. So this is obviously really cool for you guys because there's multiple types of getting capital in, but specifically at the stage that you work at, which is sort of the bridge between early stage and growth. What are general pieces of advice you have for other founders that might be in this situation, or even earlier stage founders who are looking ahead to how do I be mindful about how I'm gonna raise down the line?

Nick Findler (42:57)
Yep, I'll take that one. The biggest mistake that I see early stage businesses, not just in climate, but probably across the entire spectrum is that they wait until they need money to start building investor relationships. And that's just not how capital is deployed. And so...

I believe that capital raising is a 12 months out of the year job that starts when you start building a company and so building those relationships with investors and setting aside time to do that is extremely pivotal. And also keeping people updated. Create an email list where...

You know, once every two months you're writing an investor update of, you know, sort of what you've been able to accomplish, what are your challenges? Um, you know, one thing that I think builds a lot of trust with investors is not just sharing the good stuff, also sharing what your challenges are and where you're looking for help. And, and so I think creating that constant dialogue and relationship building and investing and going to meet people and touching palms and, and all those

extremely important and the You know the main advice I'd give to founders the whole I'm just gonna pitch slap 100,000 people on email and LinkedIn hoping that someone's gonna write a check into my company like is not Really the most prudent approach in my approach and you know in my experience anyways

Somil Aggarwal (44:33)
Definitely. And sort of the last thing that I would love to put to you is, we asked this question generally of, you know, people who are not currently building. So, you know, the VCs, service providers, things like that. If you had to quit your job right now and found a company in the climate space, what specific space would you build that company in? And honestly, a little tidbit here, would you do it together?

Chad Rickaby (45:00)
Yeah, I can take it first. Yeah, I definitely would not do it together. This has been a nightmare. No, I'm just kidding. Love it. No, it's honestly a dream to be able to build a company with your lifelong best friend, especially with one with such complementary skills and a different, you know, speaking to diversity of backgrounds. Like I said, I was reading the news. He was selling whatever he was selling that week. So very different lived experiences. And so

Nick Findler (45:01)
Yeah, take it.

Chad Rickaby (45:28)
In terms of the space, I mean, a bit of a cop out, I would find climate door, because I think scaling climate tech companies is key. But to give a real answer, I think that what excites me is sort of modular decentralized solutions to sort of off-grid, but still base load power. So thinking about things like SMRs or small modular reactors, electrolyzers, hydrogen electrolyzers, as two examples of those things.

I think that gives the opportunity for scale and that you're not just building mega plants, but you have something that is scalable, but at the same time solving really a huge challenge, especially in Canada, where you're bringing power to communities that until now have to rely on fossil fuels that are easy to transport, largely diesel, while also minimizing...

the risk of or the loss through grid transmission. So I think it solves a lot of challenges while also being something that's quite scalable and where you can get to an MVP a little bit quicker than perhaps a mega solution. So that's my answer. And yes, I would do it with Nick if he would join me.

Nick Findler (46:42)
Yeah.

Somil Aggarwal (46:43)
and they cover you.

Nick Findler (46:45)
Yeah, I mean, I, Chad and I do everything 50 and, and yeah, that's just the way it is. And I don't see that changing anytime soon. And yeah, we've been friends now for 25 years and, and hopefully we've got another 50 years of building companies together because I don't see us slowing down anytime soon. And so yeah, we definitely build it with, with Chad and the rest of our team at, at climate door. Um, you know, it's really just a blessing to get to work on.

Somil Aggarwal (47:08)
Hehehe

Nick Findler (47:15)
and hard problems with people that you care and love for is just one of the greatest journeys of life. So yeah, that answers that part. My answer on the company I would build is probably a little bit different. You know, I...

I believe that there is so much right disruption around us in traditional businesses that are heavy pollutants. And so what I would look at is, for instance, the beer machine is a great example where it's a solution that solves a very traditional problem that has a lot of energy efficiency savings. You're not using ice. You're not using cups.

you know, and finding different industries where they are polluting. We met another company this week, um, that is, um, solving for, um, windshield washer fluid and not having, um, plastic casing or containers that's carrying all of it. And so I think that this combination between taking a traditional industry, creating a solution that is much more environmentally impactful, but also better unit economics.

And so I think in my capitalistic viewpoint, that is the only way we see sweeping change across sort of industries that are not typically the most climate friendly. It needs to be novel, it needs to be a great solution, but it needs to have better unit economics. And so putting your brain into solving for those two things, I think, is where I would spend my time.

in this space.

Somil Aggarwal (49:04)
I think the real difficulty of finding those value spots where the unit economics work out in climate is becoming increasingly difficult. I'm talking to a lot of people that are talking about that in building decarbonization and trying to understand where do the unit economics sustainably make long-term sense there given the influx of policy. So I appreciate that point about scalability and sustainability of the business. Well, look, great guys. I think hopefully it was a good experience for you. I know this is our first sort of dual interview.

Super glad I was with you guys. I think you guys have a really great story. Not often I get to talk to childhood friends who made it all work out together. I live with my best friends, so I kind of resonate with some of that. But as we close out, I'd just love to ask, I know that there's something you guys would love to announce, so I'm super happy to have that, but anything you guys would like to shout out to the audience and where they can find you.

Nick Findler (49:55)
Yeah, so if anyone wants to find us, you can find us at climatedorah.com. We're also fairly active on LinkedIn and also, you know, I'm Nick Findler and this is Chad Rickaby. And if you reach out to us there, you'll definitely be able to talk to us. If you're an early stage climate business, and we work with companies globally, and you're looking for, you know, funding and you're looking to sort of grow your online presence and build sort of the business side of your company and de-risk and get ready for funding.

please reach out to us on our website. And we've actually, we've got a new newsletter that'll be launching in the next week or two, probably at the very start of the new year, that really focuses on this intersection of planet and profit. And so that's actually the name of the newsletter, it's called the Planet and Profit Newsletter. You can find it on climatador.com slash newsletter. You can...

reach out to us on LinkedIn and really we are dissecting the climate economy weekly and figuring out where are the actionable opportunities for our listeners to get involved in the industry, where can they find great business opportunities, where can they join great companies that are coming up. So yeah, that's climatador.com slash newsletter. Chad, anything on the sign off? Oh, he looks...

Chad Rickaby (51:19)
No, just thanks again for hosting us. This has been an excellent conversation and yeah, I really appreciate it. Hope you have a happy holidays.

Somil Aggarwal (51:28)
Thank you. All right, great having you guys on.

Nick Findler (51:30)
Thanks man.