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Cleaning services invoice example for corporations

this episode is presented by brex the financial stack Founders can Bank on learn more at brex.com TechCrunch 24 hello and welcome to found today we're bringing you a fun bonus conversation from backstage at this year's Tech runch disrupt Tech crunch's climate expert Tim desant talked with ar Malik the co-founder and CTO of Glacier Allison Wolf the co-founder and CEO of vibr Planet both of which are companies you may be familiar with from past found episodes in addition to hook K Su the co-founder of venex and general partner at Sky River Ventures on stage the panel discussed how a startup can balance doent good with delivering the financial returns they need to keep their investors happy and keep their own lights on they continue that conversation backstage for this bonus episode to watch the full onstage panel check out the link in our bio otherwise we hope you enjoy and have a happy [Music] holidays re one of the things we mentioned or we discussed was this idea of big Tech climate sustainability how much do they mean it how much of it is greenwashing and the thing that I really wanted to dive into more is what's the point at which kind of the curtain is opened and we can see whether they're real about it or whether it's screen washing you know when I was working at one of these big tech companies it became very apparent to me that there are plenty of people in fact most people like these companies do care about these problems but the way these companies are buil in any company is built is it's about making money it's about growing your business feeding your shareholders Etc and so while you might have good intentions ultimately like the business needs to survive and needs to thrive and that always takes priority now that doesn't mean as a big company you can't do good things I can definitely point to many examples of my time in big Tech where those good things were happening and I was actually part of a lot of those movements but at the end of the day right if things gets tight if revenue is a you know squeeze you're going to see the secondary initiatives get dropped and the primary ones are going to stay in the primary initiative at a company is always to make money it's really at this point if we want to create the change we want it's about aligning that money making with the impact you want to make how do you peel back the currens I mean you're not going to see it you just need to know that the folks who work at these places they're folks like me right I used to be at this and I still cared a ton about these problems but it wasn't my day job it wasn't my primary focus and so there are people there but the incentives may be are aign for them to make the impact that I think we all hope to see yeah and Allison you spent time working with a lot of these companies like what was your perspective there like how do we unpack this and is there kind of a particular moment where companies change and they start dropping these initiatives or is it just kind of a slow bleeding like we see with kind of these constant layoffs so AR is right to some extent I think until we change shareholder expectations and until we have more regulation like what we're seeing with the new SEC rules where it's compensatory to manage for climate risk and the csrd in Europe which is going until on 2025 I mean I think we do need legal Frameworks that change what companies value and what they are managing for but in the meantime what we've seen over the last couple of decades is where cost savings meet green and so a lot of what I was involved in in Silicon Valley over years was sort of creating a space race for who could have the most efficient data center sort of playing to the male ego sorry guys to you know create a competitiveness around that and then helped Facebook launch the open compute Foundation where those Concepts actually lived and were shared openly so that other people could replicate similarly did the same thing with renewable energy and especially as renewable energy did become cheaper than fossil fuels renewable energy made a lot of sense and so bu coalitions again and sort of a competitive Space Race in renewable energy buying where we would go into coal based States like Kentucky and Texas and say we're going to bring this many jobs this much philanthropy we're going to build some data centers and we're going to add some wind and solar to the grid and that played a big role in The Tipping Point on fossil fuels becoming more expensive than renewable energy so that's what we can do now I think we're companies have held back is on policy change I was really fortunate to work at both Google and Facebook with Bill W who is a known leader in the sustainability space and he left Facebook because out of a little bit of frustration where you can only go so far with what you can do internally on things like data center efficiency and renewable energy buying where companies really need to think about stepping up as policy change and that takes a lot of guts yeah H Jin you mentioned something like that similarly when we were on stage about the AI race and this kind of thirst for power how much of that do you think is going to drive the next wave of change in energy markets in the startups that come out of this I mean already we've seen investments from Microsoft Google Amazon in fusion and fision and other things like that but obviously we have near-term Solutions too so how do you think that's going to play out in kind of this Power Crunch around AI yeah I mean I think it's AI is definitely fueling the market in terms of alternative sources of energy and technology and it's having this second derivative impact in all Industries right you can imagine because of the need for AI there's a tremendous amount of energy storage that's needed there's also a tremendous amount of nextg semiconductor and memory that is needed to keep up with that pace that also requires nextg super high-speed fiber optics and other types of technologies that are needed so there are just so many kind of Ripple effects that are happening and because of that I think the world will change quite drastically over the coming years so when you think about people wanting to do good and changing the world we generally all I think want to do that but without a sustainable way of generating money and profit a lot of these companies are hamstr strong they can't really do it even though if they wanted to so having this other motive that has this ripple effect is I think the way these new technologies going be implemented and progress more from this conversation right after a quick break this episode is presented by brixs the financial stack Founders can Bank on brex knows cash is King for startups so they built a banking experience that takes every dollar further unlike traditional business banking Solutions Rex has no minimums and no transaction fees and you can get 20 times the standard FDIC protection even better you can earn industry-leading yields from your first dollar while still being able to access your funds anytime get the business account trusted by 1 in three us startups at brex.com TechCrunch 24 I wanted to also talk a little bit about your time at Samsung Ventures if we could because you were kind of in a somewhat internal role but with like a little bit of arms length but still thinking about the company's goals in mind so what was that interaction like since you did have a little bit of distance and some discretion but you were still ultimately within Samsung yeah and people behave differently right you have your own core philosophy of how you're going to do Investments and how you interact with startups and things like that my overall philosophy was that we need to help startup companies Survive and Thrive and by doing that they actually create nextg products and Technologies and IP which then helps the corporates such as Samsung to implement that and scale it up so that it is widely adoptable around the world but if the corporation itself Tres to say okay we want this for ourselves and provide exclusivity then it does kind of hamper the growth of that startup company and ultimately May kill the company then we're back to where we were from stage one right so I think having that vision of saying okay we're going to help this company but there has to be some incentive on the Samsung side to adopt that and so this a very fine balance that was the core Crux of what Samsung Ventures was trying to do is how can we help startup companies but also help our Mothership a little bit but make sure we don't kill the goose that laid golden egg right yeah I'll just jump because I think it's a really good point that there are opportunities for these large companies Samsungs the Googles the Amazon of the world they want to do something good for the planet and they just need the company to exist that they can actually jump on top of because they're not going to R&D that themselves so as a Founder like there's a really cool opportunity to know what the desired output is and then build towards it so that it's really easy to adopt and you you get a strong market rate like that do you think that gave you an edge or re when you were founding Glacier that you kind of knew what these big companies wanted what their motivations were definitely I think knowing how a large company operates makes it very clear what you need to do to get them to want a new new technology and having that Insight it's it's one of the reasons actually we partner with Amazon who is very much a big company and like people see them as like a big polluter as well they create a lot of stuff but the people inside like they do want to do well for the planets so knowing how they think knowing what they would spend on knowing what sort of Technology they would adopt was really helpful to designing our product our AI our offerings so that we can actually get that adoption because at the end of the day right like we're trying to not just you know become a large company ourselves but sway all these other large players and knowing how they think and work is definitely a benefit yeah at my fun as Sky Ventures one of the things we try to do is we try to understand the needs of the corporates like what are the challenges that they're facing and by knowing that and having regular discussions with various corporates we kind of understand what the market trends are like and then we try to work backwards and find startup companies that can fulfill the need of each of these corporates that accelerates the the partnership and the the poc's and the commercial launches is much quicker than just randomly investing in companies so our philosophy is a little bit different because of our experiences being at these companies and understanding the bureaucracy the timeline and where it's going to bog things down and preparing the startup companies to race for that right it's not that the corporates don't want to move faster there are these Milestones that they must hit or there's these reportings they have to do or there are these Optical you know metrics that they have to show to the executives and so we have to help them with that and not all Venture Capital funds understand this and not all people can help with that but that's where I think our fund is a little bit different in trying to say hey this company has met with you and they've now gone radio silent for months why is that a lot of starters Panic like they're stealing our IP they're doing all these things but it's said they have to go through this internal process and understanding that really helps the startup companies and also helps the corporates to be able to say okay we can't wait that long what is your next timeline and we try to help them out that way it's so important to find a champion at these companies because each company operates a little bit differently if you get someone on your side who knows how the company works it makes it so much easier to penetrate and get adoption and the cool thing is in the climate space like it's so easy to find a champion so many people want to do something big but they're stuck in the shackles of these large corporations and as soon as you meet with them they're so excited like oh my gosh you could actually change things I know how it works on the inside you bring the tech we'll form a little partnership and like good things will happen yeah I think one of the things that's kind of greased the we within a lot of these large corporations is AI and I think it was kind of like I don't want to say a cloud but definitely a subtext to our conversation which is again the enormous power demands and stuff like that as Founders do you feel kind of hamstrung by this rush to Ai and like what would ease your mind about it both from a sustainability perspective and an operational perspective so for us AI is core to our very business so the foundation of our software is a foundational model uh to map nature to the point where we can actually help with decisions around defensible space we can see roofing material and things like that to help communities mitigate fire but then we can also help with permit level decisions and the things that block permits like species like spotted Al we can figure out using AI where spotted alls might be living in vegetation right so it's core to our whole company and it's also how we are able to scale Across the Western United States and now globally not an off to the side thing in terms of do I feel badly about the energy use my My Hope Is that and our team is pioneering ways to use gpus and CPUs really efficiently and choosing when we use each to do our work on the foundational model for us the trade-off of avoided emissions that are reversing all the progress we're making on climate change the use of AI and the energy there is worth the tradeoff when you're doing really core climate Tech work it's unfortunate but we have to do it cuz it's the only way we'll keep a lot of nature intact one thing I'd like to say is that and it's been said that a one AI query takes about 100x more energy than a a Google Search right and a lot of startup CS I think feel pressured to become an AI company and in the early days of AI I think a lot of the investors were enamored by Ai and so were investing a tremendous amount of money but a lot of the Venture investors are now getting Savvy understand that and so by just being a a company with an AI rapper is no longer really of interest to investors and so those companies ultimately I don't think will get a whole lot of funding it's the AI companies that truly have a foundational Model A Unique architecture something that is very unique to them that investors are interested and so chasing after AI right now I think is a little bit overrated and maybe the trains are left the station here a bit Yeah speaking of funding climate Tech is off its peak as you mentioned H Jin around 18 billion a few years ago it is trending up we're up a little bit from last year but it's still around 4 billion or so how hard is it out there as an investor looking for LPS what's the appetite well the funny thing is you know when I was raising money for Sky River and we were a deep Tech Focus fund I had so many LPs ask me are you a climate fund are you a clean tech fund and while we do investments in those areas we decided not to say that because we think there's more to Global impact in doing good than just doing climate investing in health care investing in perhaps education in automation all these things do good it was tempting but we decided not to do that and investors a lot of investors have tremendous interest in investing in in climate companies and so on the challenge is not so much the fundraise as we saw there's still an upward Trend right now versus last year but it's the exits the exits has been really challenging for climate companies if you look at the valuation of climate companies over the last several years versus just the average valuation of tech companies the climate companies do have a higher valuation but when it comes to actual exits they tend to have a lower valuation and so the return for the investors who invested in climate in the past several years has not been as fruitful as companies who investing in other types of tech or AI or consumer or SAS and so I think that's a big Challenge and how do investors reason that out as they speak to new LPS I think is the challenge because the exit side yeah rean Alis you have similar approaches I would say to climate right you are climate tech companies but you're addressing it in a way that's not maybe explicitly going after carbon like a direct air capture company or something like that so how has it been out there fundraising as you're looking right because obviously as yuk Jin said valuations are down investors are maybe getting a little bit stingier as they're looking toward exits have you been experiencing similar sort of challenges in the fundraising Market well I think that for us we never expl ly relied on the fact that we were climate Tech to fundraise we relied on the fact that we're a good business we relied on the fact that we make money we have good margins all the things that actually matter to an investor from a financial perspective for me personally the climate angle is core to what we do but I want to present my business where the climate is kind of a cherry on top but you're really into it because of their returns because I think that's what actually attracts and so if you can position your business like that I think it makes fundraising a lot easier that being said fundraising is always difficult in some ways it's a a question of how you pitch definitely it's all about how you position making sure that you understand your investors is really key and I think you know h j said is like knowing what the investors want knowing what their LPS wants goes a long way to making sure that you and the investor resonate and they understand that you guys are both partnering on the same Mission and nobody's trying to De anyone else yeah Allison was it a little bit different for you coming from a world that's maybe a little bit more familiar to some investors being a SAS company well for us too both with our customers and with investors so we have some hardcore climate Tech investors and so for them the pitch is the long-term vision of being a nature-based climate Solutions company and that's what they're interested in and and the quantification of how much carbon we can avoid Emissions on and how much removal happens with ecosystems like forests but we are very positioned right now around Wildfire risk mitigation and with wildfires becoming you know really bad I mean last year's smoke from Canada going to the east coast this is going it sound really icky but it was probably the best thing that could have happened for our company because it really woke up not just Washington DC that even for the agencies that manage from DC the fire problem they needed to breathe some smoke too and have the orange sky like we see out here on the West Coast and similarly investors on the East Coast really needed to experience that to bring it home and so right now sort of like a ree we aren't really positioning as a climate tech company unless that is directly relevant to an investor we're playing hard to the collapse of insurance and the risk mitigation that has to be done before we lose trillions of assets one thing i' say to a lot of the companies in hard tech Capital intensive Technologies or climate Tech whatever is that a lot of them seek VCS to help them save their company and I tell them often times VCS aren't there to save your company a lot of times they're there to be honest toide the cailes of successful companies and put more fuel to the fire to help them really accelerate and so one of the things I tell VC's and I may be shooting myself in the foot here and I tell them don't come and look for funding from me if you don't need money from me in fact go and find alternative non-dilutive financing grants and all of that to really develop the technology as much as you can before you raise a funding from VCS stay in a research lab at a university stay in a national research facility whatever and just raise that NSF Grant raise whatever Grant you can and then when you're really ready to commercialize really able to like take this out to the market and accelerate quickly then go and find funding from VCS and they'll be far more likely to invest in you when they see that trajectory and growth that you've already built yeah and H Jen one last question here you mentioned that we're probably going to see IPO or exit window open up in 2025 what sorts of sectors and companies do you think are going to be entering that window first companies typically when they do go public they do have to show a line of sight to regular sources of revenue with profitability and so I do think a little bit challenging for climate companies I do see that being a little bit challenging but I think we'll probably open up the market more in the Enterprise SAS space would be my guess a lot of these AI companies might want to go public and maybe a few such as open Ai and others but I for the most it will be in the SAS play be my guess for the initial including within climate Tech see some more SAS I think so yeah thanks so much for being here everyone thank you appreciate thanks for having us thanks found is hosted by myself Tech crunch senior reporter Becca scut alongside senior reporter Dominic madori Davis found is produced by Maggie stamitz with editing by Kell our illustrator is Bryce Durban F's audience development in social media is managed by Morgan little Alyssa Stringer and Natalie chman Tech crunch's audio products are managed by Henry pikovit thanks for listening and we'll be back next week [Music]

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