Carbon Analytics was founded by a group of expats from the US, Canada and Australia while doing their Masters degrees at the University of Oxford. Michael Thornton, their CEO, held the Skoll scholarship for social entrepreneurship, and originally came up with the idea during a “business model hackathon” with former co-founder James Tilbury who was studying environmental policy and had a background in carbon accounting. Greg FitzGerald, another MBA, rounded out the founding team with his technical background in information management and analytics. Colin MacLaughlin, a chartered accountant and fellow MBA colleague, joined the team as a late co-founder bringing in-depth knowledge of how to work with a company’s accounting data, the secret sauce in our approach to environmental impact measurement.
1. What were you and your cofounders up to before Carbon Analytics? How did you come together to start a business?
We were all studying for our masters at Oxford before Carbon Analytics. Michael,
Colin and I were doing our MBA’s, and our former co-founder James, who has since moved back to Australia was studying Environmental Policy. Michael and James came up with the original idea at a business model hack-a-thon event, centred around coming up with a novel business model for tackling climate change.
2. Tell us about Carbon Analytics and how you’re helping businesses go green
The majority of people now acknowledge that global warming is a problem, and want to be able to do what they can to be part of the solution. As a business owner, the basic first step is understanding what your impacts are. Unfortunately, this has typically been a very convoluted, expensive and time-consuming process. We wanted to fix this so that any company with the motivation could quickly and easily discover their impacts, and take the steps to improve. The result is our Carbon Analytics web platform that can tell any business what their environmental impacts are based on how they spend. Whether it’s a utility bill, shipping costs, or the services of a consultant, every purchase is linked to CO2 emissions. We pull on public data to benchmark each purchase, sum it up for companies in a highly visual way, and provide a path for improvements such as switching to green energy or purchasing carbon offsets.
3. As a socially responsible company, what would you advise a startup in terms of them defining the impact of their company and getting others to believe in it?
What we have found is that people will believe and buy your impact when your personality and drive shine through. We focused on carbon emissions because it’s what we know, and we could tell the story about why we were passionate about it. It means there is no conflict between our personal values and are company values and I think people pick up on that. Becoming a certified B Corporation has also gone a long way towards giving us third party credibility.
4. Entrepreneurship can be a very lonely journey. What are your thoughts on starting a business with a co-founder as opposed to building a business as a solo founder?
I would absolutely recommend starting a business with a co-founder. You get access to a wider variety of strengths and networks, and it helps you to lose your horse blinders and question your assumptions. Some founders worry about maintaining their vision, or worry about conflict, but when harnessed correctly that conflict drives creativity and ultimately leads to a better solution. Having the extra horsepower and having friends who are also living on ramen is a big help as well.
5. How do you build a team when you’re low on capital as an early startup?
This is really tricky. The biggest thing is probably catching people at a natural transition point. Maybe she just moved to the city. Maybe he just quit his job. Maybe she is finishing school. These people are more willing to experiment and take risks, and see what happens by trying out the start-up life for a few months. In terms of compensation, this is where equity is your friend. You might not be able to offer a salary, but if they believe in your idea, your team will work with you to make their own share more valuable over time.
6. How do you tackle the big competitors as a new startup?
You have to make yourself look bigger than you are. We put up a very professional website, worked our network as hard as we could for referrals to decision makers, and always referred generically to “our company.” It only takes one contract until you’re a bonafide company, and can shed the scary perception of having new solution that no one has ever tried before. Testimonials and client references go a really long way in this regard. In the early days, being able to affiliate ourselves with competitions and start-up communities/programmes also helped to add a vote of confidence.
7. You’ve been through two accelerator programmes and have landed some incredible clients. For someone starting out, what should be their initial steps?
As a Canadian I like hockey analogies – if you don’t take shots on net, you won’t get any goals. We applied to an overwhelming number of competitions and programmes at the start – many of which rejected us – and had conversations with as many potential customers as we could to discover where we could add some value. It’s a bit of a clumsy process, but you get better at telling the story of your company over time, and having a more polished offering that is attractive to both entrepreneurial support programmes as well as prospective clients. You really have to just put yourself out there, be okay with being turned away, be receptive to any feedback and criticism that comes your way, then wash, rinse and repeat.
8. What do you wish you knew when you started your journey that you know today?
I wished I had a better sense for how to interpret different kinds of feedback. When a grant provider likes your solution that is a lot different than when a prospective customer likes your solution, which is also different to when an investor likes your solution. Knowing how to pull the signal from the noise has been a learned skill, and is worth proactively honing.
9. Any last words of advice for young and aspiring entrepreneurs?
There has never been more support for entrepreneurs. Beyond the wealth of knowledge and hard-learned lessons that are available online, we’ve benefited immensely from mentorship, funding and access to start-up communities. I’d encourage any aspiring entrepreneurs to take advantage of these resources, and to have comfort in the fact that it’s not such a lonely journey as it used to be! In the words of Richard Branson “Screw it, just do it.”