When I’m brainstorming startup ideas, one of my criteria is that the company has the potential to abate 0.5 Gigatons (GT) of CO2 a year. This was inspired by Breakthrough Energy Ventures’ investment criteria, and it corresponds to around 1% of global emissions.1

I recently learned that 0.5 GT CO2 a year is similar to Exxon Mobil’s annual emissions. Exxon’s stock has taken a beating the past few years, but as of today, it still has a $240B market cap.

This is a sobering thought, and it has a number of implications.

If you want to build a company to tackle climate change, you need to scale tremendously to achieve meaningful impact. This sounds obvious but it’s crucial to understand. You need to build an Exxon-sized business to balance out Exxon’s climate impact.

This is a tremendously risky path, and does not fit the risk profile or desired lifestyle of most people. Given this, why not just join an Exxon-sized business and try to nudge the ship in the right direction? This would be a slow and frustrating path, but it’s compelling, and I think it’s the better choice for most people.

Failure is not an option

Another implication this has for starting a company is that failure is not an option.

Starting a company and failing has become increasingly less taboo and more accepted, especially by others who have spent time in the arena. But if you spend years building a company and fail, you’ve made no difference for climate change. The earth doesn’t care that you worked hard and gave it your all, but couldn’t quite get over the hump. In fact, your impact is probably negative because you’ve used up capital that could have been better allocated somewhere else.

In the words of Eminem, if you want to start a mission-driven company, “Success is my only motherf**kin’ option, failure’s not.”

This sounds harsh, but I actually find it quite motivating and liberating. It gives you permission to take your time, do your diligence, and choose very carefully what project you dedicate your life to before throwing in all your chips, because your success is also success for the climate.

Replacement value of time

Granted, I’ve only focused on first-order effects. There are second-order effects to failing to build a company, such as paving the way for future entrepreneurs, moving technology forward, or developing skills and experiences that make your next venture more likely to succeed.

But I’d argue failing to build a company is still a net negative from society’s standpoint because you’ve dedicated your time. If you’re the type of person to start a mission-driven company, you probably have considerable skills and drive that could make a positive impact working a day job. Ironically, the more talented and motivated you are, the higher your baseline, and the higher the bar you need to set for your own company.

Notes

  1. Prime Impact Fund is the only fund I’ve come across with an even higher bar for CO2 abatement: a whopping 1 GT annually. ↩