24 Sep 2021
A Personal Carbon Reduction Plan
Today is a Global Climate Strike in cities and towns all over the world. In late 2019, was a crescendo of activity including the first Global Climate Strike and UN Climate Summit. It feels almost like time, and action, has been paused by the COVID-19 pandemic. Now in late 2021 marks a return to that pivotal time. With a summer of extreme weather events including the most wildfires ever globally, we are entering a cycle including COP26 in Glasgow. And, for those of us who are boomers, the fact that these climate strikes are led by our youth and children, should add poignancy to the state of the world we have bequeathed the next generation.
As a society and as thoughtful citizens, how can we respond? Thinking beyond surviving the worst pandemic the rich world has experienced in our lifetimes, this is the perfect time to set priorities and make life plans and we must include addressing the greatest existential crisis challenging humanity and the world we live in.
Everywhere the sense of urgency has increased. Scientific models show that the amount of carbon we can pump into the atmosphere must be limited if we are to keep to an increase of between 1.5°C to 2.0°C, which already will be a much changed earth. This remaining capacity to emit carbon, also known as our Carbon Budget, is shrinking rapidly. Hence, each year that passes, such as between 2019 and now, means that living within this carbon budget requires more drastic action and at a much faster pace.
I strongly encourage everyone to take their own personal actions. They are so important to signal to others that the Climate Crisis is serious and to help mobilize action.
Systems Change
Personal actions will never be sufficient. We also need local, regional, country-wide and global systems change to accompany our personal actions. This might be described as re-jigging our long held systems of regulation, taxation and even the incentives in our market economy. In effect, we may be re-writing the rules of capitalism itself. Examples of this include:
- Setting a sufficiently meaningful price on carbon to give monetary incentives that nudge business and personal decisions and purchases toward a carbon neutral world.
- Ensuring that this carbon price is revenue neutral and doesn’t fall unduly on the less wealthy portions of society.
- To ensure that carbon pricing is fair to local industry, a key measure needs to be adopted. Border Carbon Adjustments ensure that the product, say, manufactured in China with coal fired electricity and inefficiently shipped, has a much higher price because of all that carbon used.
- Completely removing existing fossil fuel subsidies which the IMF estimates to be an incredible US$4.7 Trillion globally or 6.3% of GDP. Even more surprising, they continue to grow. In Canada, our fossil fuel subsidies grew to CAD$18 billion in 2020. These subsidies are perverse, acting like a reverse carbon price, often nullifying the other actions taken.
- Related to fossil fuel subsidies, we need to pressure financial institutions to stop financing the fossil fuel industry. In Canada alone, our big 5 banks financed an incredible CAD$137 billion in 2020, a figure that grew 50% over 2019.
We must keep up the pressure on our elected officials of all political stripes. While we are doing this, here are my thoughts on personal actions we can take. Its a complex topic, but by breaking into down into more digestible chunks, a seemingly intractable problem moves closer to solution. Here are the major categories I use, and note that I will provide further commentary on each in following posts:
Residential
Being a northern nation with really cold winters, means that our homes consume a lot of energy which can be between 20- 25% of our personal carbon footprints. In most of Canada, it takes a lot of energy for home heating as well as cooling and domestic hot water. We also use loads of energy for cooking, laundry, home entertainment, lighting and more.
While we can, and should, reduce our energy and electrical load through active management of our device choices and lifestyle, the biggest gains come from making our homes inherently more efficient.
I am currently designing and building such a sustainable, carbon zero (or negative) home in part to show a direction for the coming years. I hope that this will lead to real insights to help future homes be more sustainable, even the average house.
Of course, most homes aren’t new but have been around for 20, 30, 50 or even over 100 years. Retrofits of those homes are an important part of the mix. Audits against the Energuide for Houses standard help determine both your home’s energy rating, but to help define a path forward. Combing this with systems change, through financing or even property tax abatement to encourage this trend, is clearly the way forward. Systems change that encourages individual action is key. Even the august Conference Board of Canada has published a policy recommendation Green Homes: Sustainable Finance for Residential Retrofits. We can only hope that the appropriate levels of government are spurred into action.
Transportation
Personal transportation may represent over 30% of our personal carbon footprint. Note that I am, somewhat arbitrarily assigning logistics and freight to produce and deliver goods to us into the personal Consumption category below. While we can work to reduce our footprints by living in compact cities with lots of walking and bicycling, this does not work for all. The largest component is the electrification of transportation represented by the acceleration of the move from legacy ICE (Internal Combustion Engine) vehicles to EVs (Electric Vehicles). We are also starting to see this trend in small trucks and eventually event transport trucks. Beyond cars, I make several suggestions:
- Public Transit – try to take public transit as much as possible to reduce congestion, whether streetcars (trams), buses, subways or commuter trains. Beyond the reduced footprint from shared vehicles (sort of like a giant carpool) most of these modes of transportation are electric or moving in that direction.
- Commercial Aviation – This is a key target of activists like Greta Thunberg who refuse to fly (see ‘flygskam‘) there is no question that flying is a growing source of personal carbon footprint. Consider reducing your use of flying, and for those trips you must take, you are strongly encouraged to purchase carbon offsets (see below).
- Taxis and Carsharing – Again, you are strongly encouraged to purchase Carbon Offsets for the kilometres you travel in taxis. Until the pandemic, Lyft (and not Uber) purchased carbon offsets automatically. Although that has been cut, they are committed to more EVs and even have ‘Green Mode’ in some cities which are electric vehicles. You wise choices do make a difference.
- Carbon Offsets – There are many carbon footprint calculators you can use, for example to offset air travel or other transportation. As I shifted from ICE to EV vehicles, the amount I have to offset is reduced. A good place to start is Carbon Zero and I would recommend choosing local projects that you can better understand when you purchase offsets. And perhaps tell others via social media what you are doing to help educate more people. Another more grassroots approach is to support the urban forest, which is a great carbon sink. Check out Tree Trust which is available in an increasing number of Ontario communities.
Consumption
The old adage of ‘Reduce, Re-use, Recycle’, and in that order, remains true even now. We live in a society where consumption, beyond any real need, has taken hold. And, it is harder to buy quality products that last – witness of the incredibly ugly footprint caused by the trend to ‘Fast Fashion’.
Another aspect to consumption is excess packaging, much of which is made from plastics. Plastics pose enormous problems to our biosphere and in particular the oceans and so reducing or eliminating single use plastics is an urgent need. Further, most plastics are made from oil and hence are another form of fossil fuel consumption. I will soon write a ‘top 10’ list for ways to reduce your personal plastic and packaging footprint – which directly reduces your carbon footprint.
I hope that this provides a high level roadmap to both personal action, but also where public policy needs to go. Of course, it over simplifies a fiendishly complicated topic. At the same time, by dissecting de-carbonization I can only hope that it inspires action, at both a personal and government level.
3 Jan 2022
Adrenaline Fund Pumps a High Energy First Year into Early Stage Investing
2021 marks the first full investment year for Adrenaline Fund which uniquely applies a passive model, fuelled by our startup and angel ecosystem, to early stage investing. Adrenaline Fund was founded in 2020 in cooperation with 2 other sub-funds in the Archangel Network of Funds. Through the vagaries of. the COVID-19 pandemic, 2021. was our first full year of investing fuelled by a remarkable group of Limited Partners who are accredited investors interested in our Purpose.
PURPOSE
The entire team at Archangel Network of Funds, and the Adrenaline Fund, is driven by a core Purpose, developed over years of building and supporting early-stage companies. In a nutshell, we want to directly impact Canada’s economic prosperity into the future by:
In this post, I’ll further explore our unique model, an exceptional team, what we’ve done so far, and propose a future where this impact can grow many times larger than our results to date.
TEAM
The Adrenaline Fund team has unparallelled experience in building companies, mentoring startups and selecting and investing in the next generation of Canada’s tech leaders but at the early stages. In addition to myself, our team includes Benton Leong and Amber French, and is ably complemented by Venture Partner Danielle Graham and the large Archangel Network of Funds team, many of whom are pictured above. Years of strategic business leadership, coupled with some of the most sophisticated selection and investment savvy, are a big part of what makes Adrenaline unique.
MODEL AND WHY IT WORKS
As mentioned, we believe that the Adrenaline Fund model and thesis is unique, at least in Canada, by fusing the power of a passive approach (like an ETF in the public markets) to the early-stage Angel investment ecosystem.
First of all, the investment decision is designed to support the existing Angel ecosystem through a set of rules to govern the investment process. At a high level, the Rules, shared with LPs, stay largely the same but are tuned in response to changes in. the ecosystem. Thus, rather than active decisions, the focus is on tuning the rules and working to ensure that the angel and startup ecosystem remain of high value.
In case some of you think, like a colleague initially did, that such a “blind investment process” is a bit crazy and perhaps akin to wagering on slot machines, nothing could be further from the truth. The secret sauce of Adrenaline is the collective value-add of the ‘qualified lead investors’ who mentor and provide ongoing strategic oversight (e.g. as a board member or board observer).
In fact, research by Brian Smith, Professor of Entrepreneurship and Finance at Wilfrid Laurier University along with global tech investment trends studied by BDC Ventures, shows an almost 25 times multiplier of success for such angel-backed companies. In summary, in generating larger ‘Scale Up’ companies (with valuations reaching US$250M), Canada has a dismal 0.3% track record (or 1 in 300) compared to the 2.5% number for the us (or 1 in 40). Within the Angel ecosystem, specifically GTAN where the study was conducted, an amazing 8% of investee companies reached the $250M threshold. Unpacking the reasons for this incredible out-performance would include factors like: the GTAN selection process, the ongoing value-adds of experienced ‘deal leads’, the strength of the ecosystem support in the Toronto-Waterloo Tech Corridor where GTAN focuses, and syndication with other capable seed/angel stage investment funds.
The bottom line is that, while adding the energy of investment to an existing process that works, Adrenaline Fund is set up for success.
Further, he model is structured to be open and accessible to the greatest number of Accredited Investors by having the aggregate investment staged over 5 equal annual cash instalments (say $250,000 at $50,000 per year). Since the fund is structured to segregate ‘Vintage Years’, and each Vintage aims to invest in 8-10 companies per year, this ensures a diversified portfolio of 40-50 companies at an extremely affordable entry point. The Vintage structure allows new LPs to join once at the beginning of each year, thus growing the maximum amount of each Adrenaline investment and helping startups even more.
Most importantly, the fund attracts investments from individuals who had never been angel investors since it provides deal flow and deal structure for new investors. In other words, we are unlocking new capital to support Canadian innovation.
PORTFOLIO
The portfolio reflects the diversity of innovation in 2021, transcending the software and consumer focus of a decade ago, with more and more patentable intellectual property and deep tech. The 2021 vintage portfolio comprises:
We are excited to welcome the following companies as our first Adrenaline Fund vintage, reflecting the powerful value-adds of the Angel Ecosystem we support:
Amber, Benton and I are pleased with the successful validation of our passive, rules-based model for Adrenaline Fund and are excited for how this will grow in 2022 and beyond.
Feel free to reach out to any of us to learn more and get involved. We’d love to have you on board.