Climate Solved Episode 1: The Origin Story

Climate Solved Episode 1: The Origin Story
Lily Backer
Climate Solved Episode 3

Climate change may seem like an insurmountable challenge. But while politics and passions paint a bleak picture of inaction, Carbon Lighthouses recognize climate change as just another problem — and problems are meant to be solved. Many of the tools for profit-driven carbon elimination already exist, what matters is finding the combination of willpower, business sense, and financial structure that make it possible. Climate Solved is a podcast celebrating the ideas and collaborations that make use of market forces to take climate action. Each week, Co-founder and CEO Brenden Millstein sits down with a new guest to discuss the solutions that will stop climate change in our lifetime. Created for entrepreneurs and leaders in commercial real estate & hospitality investment, asset management, solar, and energy services, Volume 1 will introduce you to key members of the Carbon Lighthouse team and how they’re uniting commercial interests with a mission to stop climate change.

On the inaugural episode of Climate Solved, Carbon Lighthouse CEO Brenden Millstein sits down with co-founder Raphael Rosen to discuss their friendship, the climate challenge, and the path that brought them to Carbon Lighthouse. From a kindergarten class in Berkeley to the Harvard physics department and beyond, the business partners reminisce about the card games and kindnesses that drew them together early on and their shared passion for eliminating carbon emissions that would connect them years later.

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TRANSCRIPT

Brenden: Two high school kids walk into a game of Kent.

Hi, my name is Brenden Millstein. I’m a physicist, former jazz saxophonist, and co-founder of Carbon Lighthouse. This is Climate Solved, a podcast that celebrates the ideas and actions that will stop climate change within our lifetime.

Today, you’re going to meet Raphael Rosen. Rapheal is my co-founder, and the president of Carbon Lighthouse. He holds bachelor’s and master’s degrees in physics from Harvard and Cambridge University. He’s also the only person who ever reliably beat me at minute math throughout elementary school.

Raphael and I started Carbon Lighthouse together in 2010. It seemed only fitting that we would start our podcast series with an origin story. As you’ll hear, Raphael and I have traveled a fun and ridiculous road together. He’s my closest friend, concerning-ly intelligent, and the most earnest, thoughtful, and genuine person I know. It’s always inspiring to sit down with him and talk about solving climate change. I hope you enjoy the conversation.

Was there a particular moment where you got excited to partner with me in some way? I remember mine was early actually, it was in high school when I first got very excited about the idea of partnering with you in some way.

Raphael: The story that actually comes to mind is one time, in high school, we were becoming much closer, and I was hanging out with you at someone’s house in El Cerrito. I was sitting off to the side being the unhappy teenager that I was, and you waved me over to come sit closer with a group of people I didn’t know. That warmth of inviting me in to go spend time with those people that I didn’t know, and you just being there to be that link, made me certainly want to spend a lot more time with you in general as a friend, because somebody who was so welcoming just made me really happy.

Brenden: That’s great. I have no memory of that, but the story makes me happy.

I’m curious if you remember this story. So, the first time I can think of where I was like, “Man, that Raphael, we gotta find a way to do things together”, was also in high school. We were at Adam Scheffler’s house, with Dan Donahoe, as well, and the four of us were playing a card game called Kent.

Raphael: I do remember this.

Brenden: Yeah. The goal of Kent is that you play in teams of two, so as soon as your partner has four of the same kind in their hand, so four aces, or four threes, or whatever, you have to say Kent. It’s tricky because you can’t talk, and if the other team says Kent when you’re team has Kent, they actually get the point. So, you need to figure out ways to communicate, just between the two of you, without talking.

It’s this kind of chaotic game where communication is key. Raphael and I just crushed it. It was like we were psychically connected, and our ability to communicate with each other through this chaos of cards was extremely high. I remember at the end of that night, I came away thinking, “Wow. Raphael and I are just really on the same page. That was very effective. I wanna figure out how to work with him somehow.” Then, 10 years later we got the opportunity.

After Raphael and I left Harvard, we both went our separate ways for a little while, working at different companies to learn about climate change, and different solutions to the problem. Along the way, Raphael learned a bit about building engineering, as you’ll hear.

Raphael: One of my first times in the building was my first day at Safari Energy in New York. It was, I think, literally my second day, and we drove up to Wesleyan University, and they were doing a solar project. We were trying to figure out whether the roof could structurally support the solar we wanted to put on there. It was me and another person who also knew nothing about roofs, or anything structural, walking around the facility, and crawling into that attic.

Brenden: Sounds like the right team.

Raphael: Yeah, exactly. Super experienced.

We went into that attic, and thankfully the facility’s person was there, who actually knew something about buildings, and we just started taking pictures of stuff. He had a tape measure, and was starting to measure the distance between the studs. He was talking 16 inches on center, and all these things, that now are obvious to me, but I literally had no idea what he was saying. We asked a bunch of questions and figured it out. Nine months after that we actually put solar on that roof.

Brenden: What made you excited to start Carbon Lighthouse with me? I remember starting a very concerted lobbying campaign to get you to co-found with me, but I’m curious why you switched over. I don’t know why I’ve never asked you this before. I’m so curious.

Raphael: I think, obviously we talked about starting a business way back in college, maybe even earlier, but certainly in college we were always dreaming up various energy related, or even other business ideas. That thought was always front and center in my mind, having worked really late nights with you under lots of pressure to get stuff done, and have an amazing time doing it. That was a good indicator that building any business would be really fun together.

Brenden: When did you first become aware of climate change, and how did you get into that as a problem to be solved?

Raphael: I would say, certainly for me as a kid growing up in Berkeley, it’s a very environmentally minded place, going with family trips to Yosemite, and the importance of conservation and John Muir, the famous conservationist was a hero of mine since I was a little kid.

I remember wanting to be John Muir, and my parents kindly indulging me and calling me, Raphe Muir, or something related to Muir when I would lead the way on trails that were disappearing out into the wilderness. That sense of nature is something to be conserved and something to be protected.

Brenden: Looking around the world, in 2009, at how can we stop climate change, solar was five times as expensive, and wind was twice as expensive as it is now, and batteries were catching on fire. What appealed to me so much about energy efficiency, which is obviously how we started the business together, was that it was already profitable now.

We could take it straight to building owners, and educational institutions, and hotel owners, and everyone in buildings, and make them money right now without any government intervention, without any policy changes, without any subsidies and taxes, and use that to make them money, and make it easy. I felt like I had to start this business. As soon as I felt like that, then I thought, “Okay. Now I have to recruit Raphael to start it with me.” That was a little bit of a different genesis for me.

Want to talk a little bit about the business model, and what we’ve done, and how it works?

Raphael: Sure. The initial view was really, how do we make buildings carbon neutral profitably? That is obviously what drives you and I, is getting carbon emissions to zero as quickly as possible, as profitably as possible. That’s the only way to have meaningful impact. What we’ve evolved to, too, as you and I have talked about a bunch is when the first people we went to go talk to, the only people who would talk to two guys with a couple laptops, were pretty environmentally minded folks.

Environmentally minded folks who owned buildings, have already put in the latest and greatest, most efficient equipment, and they’re already doing any kind of utility program that’s out there. So, we were faced with the situation of, “We want to do energy efficiency, we know there’s tons of opportunity, a lot of that opportunity has already been harvested in these particular buildings. So, if we’re gonna do anything, let’s just start measuring stuff, and hope for the best.”

We just started putting out sensors, and what that evolved into, as far as the business model, is a system of collecting tons of information from buildings, and figuring out exactly the most efficient ways to run them, in terms of thermodynamics and trade offs between fans, and pumps, and other things, and providing that as an ongoing service that can guarantee new revenue to building owners through improved operations of all their existing equipment.

Brenden: You mentioned part of our process where we go to buildings, we deploy sensors, and as I think you described, we measure everything, which is definitely how I feel to. To quantify that, we get about a thousand times the data of a typical firm, which is easy to say, but to make that a little tangible, the difference of a thousand to one, is take your current height, and now pretend you are the height of a fruit fly. That’s about a thousand to one, assuming you’re just a little bit under six feet tall. A fruit fly …Your life would be different if you were the height of a fruit fly. You could climb up walls, because the tiniest little indentation would be like a giant ladder for you.

We certainly measure everything, and then we use that data to make all the existing equipment operate a little bit better. It seems like this is a win-win here, we’re building owners, and educational institutions, and the tenants, or occupants inside them save money, and we make money in the process of doing it. Do you wanna talk about some of our early success/struggles?

Raphael: One of my favorite stories is, one of our first buildings was an office building in Sacramento. It was converted from a former hotel and turned into an office building. I remember we were doing the deployment of sensors in the morning, and we knew we had a 12:30 lunch with the property manager and asset manager of that building.

We were dressed in our field clothes, we had all of our sensors, we then went into … we were on the roof, we then went into some really dusty mechanical room in the bowels of that building, and just got … there was a fan in there blowing, too, so we were literally covered in dust after doing this deployment. We were obviously sweaty from carrying the gear around, and then at 12 we had to stop what we were doing.

We ran into one of the tenant bathrooms, which had these gilded gold handles on the faucets. We were in our clothes, stripping down out of our field clothes, spraying water on ourselves. They didn’t have paper towels, so we were trying to dry under the air dryer, and then putting on a shirt, and tie, and slacks, and then going out and having a nice lunch with the property manager and asset owner, trying to look cleaned up, and then successfully selling that building.

That was one of the first sites we did, and I think we saved them something like 30 grand a year, in that building, from all the upgrades we put in place there.

Brenden: That $30,000 dollars we saved them, too, is worth, as I recall, quite a bit of carbon dioxide. So, I think it was about 100 tons worth of CO2 savings. For an eight floor building, putting 100 tons of CO2 in there, could probably fill that building 30 times over. We’ve eliminated the emissions of six power plants, and we have about 50,000 left to go. So, there’s room for improvement still.

Can you talk about some of the reasons you’re so optimistic? I share this with you, but I’m curious to hear what yours are. Why do you think this is such a solvable problem?

Raphael: I think because the technology required to solve it already exists, what matters is the will power, and putting the right business together, and making sure the financial structuring can be done, because there are, for many technologies, up front costs. So, making it a business that is just easy, and puts money in people’s pockets is very easy to talk about, but as you and I have discovered every day, is much harder to actually do, but it absolutely can be done. Thankfully there are hundreds of companies all over the world trying to get exactly that done.

Brenden: I think one of the things that makes me most excited is that I think the growth of the firm has been very good so far. We double revenue and impact roughly every 14 months, or so, or every 15 months since launch. So, a little bit faster than Muir’s Law.

We’re at a point in the company now, after eight years of doing this, where things are working pretty well. I’m so excited because there is still so much room for improvement. I feel like we’re in this unique window where we can continue to keep doubling every year. There’s nothing stopping that.

The improvement might be faster than that, and yet also, everything is already working. The capacity to keep doubling for enough time to actually stop climate change is right there for us. We just “have to do it”. I’m excited to go do that.

Raphael: Yeah. I think what I’m most excited about at this point, honestly, is how hard it is to keep up with demand, which is one of those dream problems to have, is that finally what we’re saying is resonating with clients. We’re finally speaking intelligibly. They can see the value, and they can understand how we’re gonna deliver it, and people are getting that you can do what’s good for the planet, and make money in the process, which is something I’ve known for 15 years, but day by day, the grind of changing people’s minds. To see that accelerating, is so gratifying, and cool.

Brenden: Yeah. It makes me excited, too. All right. Well, Raphael, thank you so much for being my first guest, and similar to being my first excellent Kent partner. I’m very excited to see the continued growth, and stoppage of climate change.

Raphael: Likewise, my friend.

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