Week in Review

Stories discussed this week.

• Leading the sustainability transformation
• Funding climate tech and entrepreneurs of color should go hand in hand
• How sustainability professionals can uplift the black community
• How on-demand delivery apps could encourage low-carbon food

Features

A new angel fund dedicated to decarbonization (18:50)

Ramez Naam, futurist and board member for Seattle-based angel investor network E8, chats about the new Decarbon-8 fund and why seeking racially diverse founders will be a priority. “Because if we are going to help some people build companies in this, and they’re going to profit, as the entrepreneurs should, we’d like some of that to go back into those people, in those communities,” he says. 

Funding biodiversity (31:14)

William Ginn, author of the new book “Valuing Nature,” talks with Associate Editor Deonna Anderson about ways the private sector can address biodiversity.

Voices of the clean energy equity movement (48:25)

GreenBiz Senior Analyst Sarah Golden shares highlights of conversations with Bartees Cox, director of marketing and communications at Groundswell, an organization that brings community solar to low-income customers; Alexis Cureton, former electric vehicle fellow at GRID Alternatives, which works to bring clean energy jobs and access to low-income communities; and Taj Eldridge, senior director of investment at Los Angeles Cleantech Incubator.

*Music in this episode by Blue Dot Sessions, AdmiralBob 77, Stefan Kartenburg and Lee Rosevere: “Throughput,” “Our Fingers Cold” and “Hundred Mile — Atmospheric” (Blue Dot); “Two Guitars” (AdmiralBob 77); “The Vendetta,” “Guitale’s Happy Place” and “Arc de Triomphe” (Kartenburg); “Curiosity” and “I’m Going for a Coffee” (Rosevere)

*This episode was sponsored by UPS.

Virtual conversations

Mark your calendar for these upcoming GreenBiz webcasts. Can’t join live? All of these events also will be available on demand.

The future of risk assessment. Ideas for building a supply chain resilient to both short-term disruptions such as the pandemic and long-term risks such as climate change. Register here for the session at 1 p.m. EDT June 16.

Supply chains and circularity. Join us at 1 p.m. EDT June 23 for a discussion of how companies such as Interface are getting suppliers to buy into circular models for manufacturing, distribution and beyond. 

Fleet of clean fleet. Real-life lessons for trucking’s future. Sign up for the conversation at 1 p.m. EDT July 2.

Resources galore

State of the Profession. Our sixth report examining the evolving role of corporate sustainability leaders. Download it here.

The State of Green Business 2020. Our 13th annual analysis of key metrics and trends published here.

Do we have a newsletter for you! We produce six weekly newsletters: GreenBuzz by Executive Editor Joel Makower (Monday); Transport Weekly by Senior Writer and Analyst Katie Fehrenbacher (Tuesday); VERGE Weekly by Executive Director Shana Rappaport and Editorial Director Heather Clancy (Wednesday); Energy Weekly by Senior Energy Analyst Sarah Golden (Thursday); Food Weekly by Carbon and Food Analyst Jim Giles (Thursday); and Circular Weekly by Director and Senior Analyst Lauren Phipps (Friday). You must subscribe to each newsletter in order to receive it. Please visit this page to choose which you want to receive.

The GreenBiz Intelligence Panel is the survey body we poll regularly throughout the year on key trends and developments in sustainability. To become part of the panel, click here. Enrolling is free and should take two minutes.

Stay connected

To make sure you don’t miss the newest episodes of GreenBiz 350, subscribe on iTunes. Have a question or suggestion for a future segment? E-mail us at [email protected].

Not-so-news flash: The venture capital community has an abysmal track record when it comes to funding entrepreneurs of color. 

Here’s the backstory in numbers. According to the nonprofit investor network BLCK VC, just 1 percent of venture-funded startup founders are black (that data comes from the Harvard Business School). Just as shocking, although maybe not surprising given the tech industry’s troubled past on diversity writ large, 80 percent of VC firms don’t have a single black investor on their staff. 

Over the past week, big-name firms SoftBank and Andreessen Horowitz took baby steps toward addressing this, but far more needs to be done — especially when it comes to finding and funding climate tech. The specifics:

• SoftBank has created a separate $100 million fund specifically dedicated to people of color: Cool, but that amount is minuscule alongside the $100 billion in the SoftBank Vision Fund. 
• The new Andreessen Horowitz effort is a donor-advised fund launched with $2.2 million (and growing) from the firm’s partners with a focus on early-stage entrepreneurs “who did not have access to the fast track in life but who have great potential.” 

Let’s cut to the chase. These are well-intentioned gestures, but they don’t even begin to address the bias that pervades the VC system, at least the one that exists in the United States.

“Black entrepreneurs don’t need a separate water fountain,” observed Monique Woodard, a two-time entrepreneur and former partner at 500 Startups who backs early-stage investors, during a BLCK VC webcast last week that was livestreamed to more than 3,000 people. (She wasn’t specifically addressing the two funds.) “You have to fix the systemic issues in your funds that keep black founders out and keep you from delivering better returns.”

What’s wrong with “the system”? Where do I begin? One black venture capitalist on the webcast, Drive Capital partner Van Jones, likened getting involved in the VC community to a track race in which you’ve been seeded in lane eight and handicapped with a weight vest and cement boots. “There is no reason we should be having the conversation today that we had in the 1960s,” he said during his remarks. 

Elise Smith, CEO of Praxis Labs, a startup that develops virtual reality software for diversity and inclusion training, tells of putting on “armor” to engage with the predominantly white ecosystem supporting entrepreneurs — where her experience has been questioned repeatedly and her mission described as niche or as a passing fad. 

Smith says one of the biggest issues faced by black founders: the inability of many investors to recognize problems faced by communities of color. “What happens when the problem you want to solve isn’t one that is faced by the people who make decisions about what is funded?”

Or, as Garry Cooper, co-founder and CEO of circular economy startup Rheaply. puts it: “I have to overachieve to achieve.” He adds: “You are running a race twice as hard as your white counterparts.”

He knows firsthand. Rheaply, which makes software that helps organizations share underused assets, raised $2.5 million in seed funding disclosed in March from a group led by Hyde Park Angels. Cooper started speaking with potential investors more than a year ago and was struck by how difficult it was for him even to score an introduction. While he has praise for his “committed” funding partners, Cooper is the only black founder represented in his lead investor’s portfolio. “It’s shameful that I know all the black VC founders in Chicago,” he said.  

Along with some of his allies, Cooper is sketching out what he describes as a “pledge” intended to help expose this issue more visibly. The idea is to encourage hot startups — regardless of the race or gender of the founders — not to seek funding from firms that don’t represent the black community on their team of investors or within their portfolio. Stay tuned for more details as they are finalized, but Cooper says the response to this idea so far has been gratifying.

As a climate tech startup founder, Cooper agreed with my personal conviction that any VC firm funding solutions to address climate-related technology solutions must pay particular attention to the issues of equity and inclusion. And yet, when I’ve asked well-known VCs about their strategy for this, none has offered specific strategies for recognizing the needs of people of color in the ideas they consider. I must admit: I never have asked any of them specifically about their strategies for funding entrepreneurs of color. But this is something I’m going to change. “The problems are so enormous, we need every brilliant committed mind thinking about this,” Cooper said. 

That sentiment is echoed by Ramez Naam, futurist and board member with the E8 angel investor network, which recently launched the Decarbon-8 fund dedicated to supporting climate tech. Naam said investors funding climate tech startups must recognize the intersection between the climate crisis and the crisis of racial justice. That’s why Decarbon-8 will be intentional about seeking entrepreneurs of color.

“We think that means it also makes sense to find entrepreneurs and teams who are minorities that are in the groups that are most impacted themselves. Because if we are going to help some people build companies in this, and they’re going to profit, as the entrepreneurs should, we’d like some of that to go back into those people, in those communities.” 

Truth.

This article first appeared in GreenBiz’s weekly newsletter, VERGE Weekly, running Wednesdays. Subscribe here. Follow me on Twitter: @greentechlady.

When you sit back with a good cup of coffee, you will be engulfed in the warmth, aroma, taste, acidity and body of the brew. Yet, swirling beneath the surface all of the major issues of the 21st century — climate change, globalization, immigration, women’s rights and wealth inequity — are being played out in remote coffee villages around the world. 

How companies behave in the coffee trade has a direct impact not only on the lives and livelihoods of 28 million coffee farming families but on the welfare of the planet itself. Coffee companies claiming to be “ethical” or “sustainable” that refuse to pay a living wage to the farmers are fueling this longstanding human and environmental crisis. 

Changes in rainfall patterns and temperature weaken coffee plants and reduce yields. Climate-enhanced fungi and bacteria decimate coffee plants, leaving families with little or no income for the next five years until new trees can be planted and mature. Larger farm owners must deforest land and plant more coffee to make up for the historically low prices they are receiving from the market. This deforestation inhibits carbon sequestration, which leads to higher temperatures. The cycle is self-fulfilling. 

As a result, coffee production will be greatly limited in medium and lower elevations by 2030 to 2050. When production is reduced, farmers may use more chemicals in the growing process, which harms the soil and water sources, further degrading the planet and human health.

Coffee, poverty and migration are also connected. The largest single group of migrants trying to cross the southern border are from Guatemala, and most of them are from the coffee lands of Huehuetenango province. They are unemployed and landless coffee farming families hoping for a better life. 

The price per pound paid to coffee farmers is based on the “New York C price,” a commodity system that operates much like a stock market. For several years, the C price for coffee has hovered around the farmer’s cost of production ($0.80-$1.10), which means no profit for the farmers. From a high in 2014, prices paid to farmers have plummeted by 70 percent and now dance around $1 per pound. Every pound a farmer sells, and every cup we drink, pushes a farmer deeper into poverty and despair. 

If coffee companies really want to fight the difficulties facing coffee farmers and the environment, they should just pay up.

Companies are not required to base their payments to farmers on the C price, and many of us do not. Organic and Bird Friendly certifications offer a price premium to the farmer. Fair Trade provides a “living wage floor” and many committed Fair Traders pay substantially higher prices. The few real Direct Traders offer real price premiums for limited amounts of high-quality coffee. Many companies hide behind labels, such as Rainforest Alliance or Utz Kapeh, or self-created programs such as “Ethical Sourcing,” which sound good but do not guarantee higher prices. 

Ironically, coffee company profits may be the highest in history. Companies such as Smuckers and Starbucks continue to raise their prices while their main cost of goods (buying coffee beans) has dropped considerably. According to the United Nations, the ratio between what the farmer was paid and what the companies sold their coffee for was 1:3 during the 1970s. Today, it is as high as 1:20, as many consumers are paying $20 a pound. 

In 2012, Starbucks reported its average price for green beans was $2.56 per pound. However, that is the price it paid to the broker, not to the farmer. After backing out shipping, insurance, importer and exporter and mill costs, that price would be closer to $2.20 paid per pound to the farmer. By 2014, Starbucks was only paying $1.72 to the broker (maybe $1.36 to the farmer). By paying the lower amount, Starbucks took $387 million out of the farmers’ pockets. As green prices keep falling, Starbucks has continued to pay coffee farmers less, while charging consumers more. 

So, who is winning this game? Not the farmers, not the public and not the environment. Instead of paying enough to support the farmers, large and small coffee companies contribute lesser amounts to nonprofits for clean water, health and environmental projects under the banner of “corporate sustainability.”

If coffee companies really want to fight the difficulties facing coffee farmers and the environment, they should just pay up. If Starbucks returned to its 2012 broker and farmer prices, it nearly would double family income on most small farms. To family farms in Nicaragua, Peru, Ethiopia and Indonesia, that $1,400 could pay for healthcare, children’s education, proper nutrition and technology to produce higher yields and reduce their need to clear land. Even a 25-cent increase in the price paid to farmers, which would get Starbucks closer to the prices paid by truly committed coffee companies, would bring $150 million back to the farms and its stock price would not even blink.

As an industry, we have lived long and well by treating farmers just like coffee. We see them as fungible commodities instead of true partners in the success of our businesses who are integral to effective adaptation to climate change and other issues of the day. The days of maximizing profits without seriously incorporating farmers’ concerns that bind us all together are over. It is time to pay up.

The COVID-19 crisis has affected most aspects of daily life, including how we get our food. Because the COVID-19 response has restricted restaurants to pick-up and delivery orders in many areas, business for on-demand food delivery apps such as DoorDash, Grubhub, Seamless and Uber Eats has increased dramatically. 

Uber Eats claims to have experienced a tenfold increase in new restaurant signups, and some local restaurants say the percentage of orders placed through third-party apps has risen from around 20 percent to roughly 75 percent. 

Even before the COVID era, food order and delivery apps were growing rapidly, and the sector was on track to more than double in value by 2025 — from $82 billion in 2018 to $200 billion by 2025. Projections showed that by 2023 about one-quarter of smartphone users, or 14 million Americans, will use these apps. 

For the environmentally minded, the increased adoption of app-based food delivery services presents a unique opportunity to affect carbon emissions in the food supply chain.

One of the leading climate change solutions is the widespread adoption of a plant-rich diet, particularly in countries with a more “Western” diet. Adopting these habits has the potential to reduce carbon emissions by 66 gigatonnes CO2-equivalent, according to Project Drawdown. Compared to business as usual, choosing vegan options could reduce emissions by as much as 70 percent.

Third-party food delivery apps offer a valuable opportunity to connect consumers to the knowledge they need to adopt a climate-friendly diet. 

We believe that food delivery apps can implement some basic features to help consumers be more aware of the environmental impact of their food choices.

While systematic change in food production at all levels is necessary to achieve goals for carbon emission reductions, influencing consumer behavior to shift towards low-carbon food options has the power to simultaneously encourage food producers up the supply chain to reduce the carbon impact of their offerings, while also empowering consumers to reduce their own personal carbon footprints.

A recent study in Science magazine noted that “dietary change can deliver environmental benefits on a scale not achievable by producers.” However, a major roadblock is the lack of transparency surrounding the carbon impacts of food. 

Many consumers recognize that animal products have some negative impact on the planet, yet most don’t truly know the extent to which meat consumption can drastically increase carbon emissions. 

Indeed, according to a recent study by the Yale Center on Climate Change Communications, about half of surveyed Americans (51 percent) would be willing to eat a more plant-based, low-carbon diet if they had more information about how their food choices affected the environment.

Through a six-week climate innovation program at Yale, we envisioned two ways that on-demand food delivery apps could empower their users to make more climate-friendly food choices. We based our idea off a successful project at Yale demonstrating the effectiveness of environmental impact ratings on consumers — in this case, students at Yale’s dining halls.

Rate the Plate is an initiative designed by current Yale students through which dining halls display posters containing the calculated range estimates for the amount of carbon emissions from each available entree. After running both a small-scale pilot and then expanding to all Yale residential colleges, the organizers had students complete a survey to analyze the effectiveness of the posters and ratings. The results show that 62 percent of students had a positive response when asked if they reconsidered their food choices after seeing the ratings. 

Additionally, when asked if they would like to continue seeing the environmental impact posters in the dining halls, more than 86 percent of students said yes. 

The results of this project inspired us to consider other ways to empower consumers to make climate-friendly food choices.

We believe that food delivery apps can implement some basic features to help consumers be more aware of the environmental impact of their food choices. 

First, food order and delivery companies can create short monthly quizzes for users to test their knowledge about the carbon impacts of various food options. An interactive, visually appealing quiz can inform consumers about how their own food choices can affect the planet as a whole. Positive messaging alongside discounts or other incentives can encourage users to take the quizzes and act on the information they learn. 

For example, online consignment retailer ThredUp already runs an online quiz that consumers can take to determine their environmental impacts in the apparel sector.

Additionally, companies could implement carbon labeling within their order menu interface. There are various existing methods to estimate and label the carbon emissions associated with food dishes, but a simple number or range of carbon equivalents would allow consumers to compare meal options within the app. 

Using color coding or symbols such as trees to indicate high- and low-carbon footprint items also would be a non-obtrusive way to represent the information. The methodology could be explained in one of the quizzes released each month so consumers feel that they have both easy-to-read and accurate data. Order and delivery apps could include discounts for consumers opting into low-carbon food selections.

What’s in it for companies such as DoorDash and Snackpass? 

Companies would be able to analyze the data on these strategies to fulfill internal corporate sustainability metrics on reducing GHG emissions, and such information could be advertised to demonstrate the company’s drive and success in sustainability compared to competing apps. 

There is growing demand for sustainable business practices and purchasing options, especially among younger consumers. Being known as a climate-friendly option in the food-delivery ecosystem likely will be a selling point for many companies.

If food delivery apps implemented these various features, tracking the environmental impact would be relatively straightforward because it relies on digital technology and data collection. By looking at the number of people taking the carbon-impact quiz every month, companies could get a sense of the reach of these efforts among their customers. Eventually, they also could use the consumer order data to look for significant shifts in the carbon impacts of dishes people order. 

What’s the role for restaurants? 

While the relationships between restaurants and food delivery apps sometimes can be contentious, restaurants could benefit from advertising themselves as a climate-friendly option. 

Restaurants would provide information about the ingredients lists of their dishes, allowing food delivery apps to calculate carbon impacts. As previously mentioned, discounts are offered to consumers who take the food carbon quizzes, which can help restaurants draw in new customers as well as highlight some of their vegan and vegetarian options.

Ideally, there would be a shift towards vegetable-based options and away from meat-heavy dishes after the carbon ratings and quizzes are implemented, which would demonstrate a positive impact on consumer decisions in terms of carbon emissions. This data from before and after the intervention also could be used to create a baseline to calculate how many kilograms of carbon dioxide emissions were avoided due to lower demand for meat-heavy dishes. 

As food-delivery apps continue to gain popularity over the next decade, integrating information about the climate impact of food options has the potential to address the large impact the food-supply chain has on carbon emissions. This information gives consumers power in their food choices and allows food-delivery apps to demonstrate climate-friendly values.

Week in Review

Commentary on this week’s news highlights begins at 13:00.

• This moment: An open letter to the GreenBiz community
• Al Gore: Climate action is “bound together” with racial equality and liberation
• How the Navajo got their day in the sun
• It takes a village to succeed in climate tech

Features

The quest for net-positive buildings (22:35)

The pressure for companies and cities to consider the climate crisis — and associated risks — in post-COVID 19 recovery strategies is increasing. How feasible are net-positive buildings, and how might our new economic landscape affect their development? We discuss the issue with Ryan Colker, vice president of innovation for the International Code Council; and Andrew Klein, a professional engineer who is a member of ICC and code consultant for the Building Owners and Managers Association International.

Growing a carbon market for urban forests (34:45)

The process of issuing carbon credits for reforestation projects in places such as rainforests as well established — not so much when it comes to trees growing in the shadow of skyscrapers. Mark McPherson, executive director of City Forest Credits, talks about the nonprofit’s mission to plant and preserve more trees to towns and cities, and how companies can get involved.

Extending the life of medical equipment (43:25)

The iFixit repair site just added the world’s largest medical equipment repair database, a free resource for hospitals having trouble fixing equipment quickly — a problem exacerbated by the COVID-19 pandemic. The site’s CEO and founder, Kyle Weens, joins us to chat about the project and why more product vendors should rethink their repair and service policies.

*Music in this episode by Lee Rosevere: “Southside,” “More On That Later,” “Night Caves,” “Curiosity” and “As I Was Saying”

*This episode was sponsored by UPS.

Virtual conversations

Mark your calendar for these upcoming GreenBiz webcasts. Can’t join live? All of these events also will be available on demand.

The future of risk assessment. Ideas for building a supply chain resilient to both short-term disruptions such as the pandemic and long-term risks such as climate change. Register here for the session at 1 p.m. EDT June 16.

Supply chains and circularity. Join us at 1 p.m. EDT June 23 for a discussion of how companies such as Interface are getting suppliers to buy into circular models for manufacturing, distribution and beyond. 

Resources galore

State of the Profession. Our sixth report examining the evolving role of corporate sustainability leaders. Download it here.

The State of Green Business 2020. Our 13th annual analysis of key metrics and trends published here.

Do we have a newsletter for you! We produce six weekly newsletters: GreenBuzz by Executive Editor Joel Makower (Monday); Transport Weekly by Senior Writer and Analyst Katie Fehrenbacher (Tuesday); VERGE Weekly by Executive Director Shana Rappaport and Editorial Director Heather Clancy (Wednesday); Energy Weekly by Senior Energy Analyst Sarah Golden (Thursday); Food Weekly by Carbon and Food Analyst Jim Giles (Thursday); and Circular Weekly by Director and Senior Analyst Lauren Phipps (Friday). You must subscribe to each newsletter in order to receive it. Please visit this page to choose which you want to receive.

The GreenBiz Intelligence Panel is the survey body we poll regularly throughout the year on key trends and developments in sustainability. To become part of the panel, click here. Enrolling is free and should take two minutes.

Stay connected

To make sure you don’t miss the newest episodes of GreenBiz 350, subscribe on iTunes. Have a question or suggestion for a future segment? E-mail us at [email protected].