The Entrepreneurs for Impact Podcast: Transcripts
#132:
Over $55M+ for No-Cost Reforestation on Post-Wildfire Burned Acreage — Grant Canary, CEO of Mast Reforestation
PODCAST INTRODUCTION
Grant Canary:
We solve the problem for a landowner or a land manager, they're impacted by wildfire. Wildfire has been increasing significantly in size and severity. What do they do? Where does the seed come from? Where do you grow it into a seedling in the greenhouse, this little baby tree? How do you get it out to site and then how do you pay for it all? So, that's something that we are able to remove that pain point so that we can really restore at scale. And that's the mission of the company, make reforestation scalable.
PODCAST INTERVIEW
Chris Wedding:
Welcome to the Entrepreneurs for Impact podcast. My name is Chris Wedding. As a former environmental private equity investor, four times founder, climate tech CEO, coach and professor, I launched this podcast to share the entrepreneurial journey, practical tips and hard-earned wisdom from CEOs and investors tackling climate change. And if you like what you hear, please leave us a review on your favorite podcast player. This is the number one way that listeners can learn more about the climate CEOs and investors I interview. All right, let's get started.
My guest today is Grant Canary, Founder and CEO of Mast Reforestation. In addition, Grant is also a former, well, maggot farmer that is starting a business to grow industrial grade insect protein, using food waste to then grow fish as in farms. Why his prior unofficial roles as a chess and poker player, as well as improv enthusiast are relevant to his CEO work today.
In this episode, we talked about the nuances of carbon removal in the carbon credit world, as in like, don't throw the baby out with the bathwater. What their new project financing allows them to do. How they bought a 130-year-old seed company as a Series A funded company. Why forest often cannot regrow on their own after a wildfire. Why they set up 100-year endowments to fund ongoing reporting on forest health and carbon sequestration. The role of buffer pools to ensure carbon credit integrity. The importance of poly versus monoculture in their replanting of these forests.
02:50
How he took advantage of grad school arbitrage by studying in Bogota, Columbia. You got to listen to hear what that's all about. Why it's so important to create a compelling future versus doom and gloom in order to mainstream climate efforts. His favorite startup books, and a whole lot more. Hope you enjoy it and please give Grant and Mast Reforestation a shout-out on LinkedIn, Slack, or Twitter by sharing this podcast with your people. Thanks.
Grant Canary, CEO and Founder of Mast Reforestation, welcome to the podcast.
Grant Canary:
Hello, hello. I'm excited to have some fun.
Chris Wedding:
I will start by saying you are, let me rephrase that, you were once upon a time, a chess player in the Oregonian forest of the Aquatopia that is in Northwest, then poker, then improv, then what the heck? How about a maggot farmer in Bogota among other places in your 10-year journeys overseas in sustainability and now back to your roots, providing most of new seedlings for reforesting California. It’s some interesting path to get here, huh?
Grant Canary:
So much to open up there. They're all accurate and yeah, thank you for that. Yes. Maggot farmer is definitely one of my esteemed titles. It's not necessarily on my LinkedIn, but something I'm proud of.
Chris Wedding:
There you go. So, I think you're also the only known guest with some improv training. So, the bar is now really high for you to perform for the listeners, just no pressure, but there it is.
Grant Canary:
Well, the secret to improv is, it’s funny when you screw up and it's how to be funny while screwing up, so hopefully we'll see some of that or we'll be able to entertain folks well enough.
Chris Wedding:
I like how you just lowered expectations there in the process, right?
Grant Canary:
Amazing at lowering expectations. Yes.
04:50
Chris Wedding:
There you go. A great skill. Let's go straight to it, so Mast Reforestation. What's the pitch, man?
Grant Canary:
We are vertically integrated and we solve the problem for a landowner or a land manager, they're impacted by wildfire. Wildfire has been increasing significantly in size and severity. What do they do? And that vertical integration is where we play. Where does the seed come from? Where do you grow it into a seedling in the greenhouse, this little baby tree? How do you get out to site? And then how do you pay for it all? And that's where we utilize carbon removal credits under the climate action reserve methodology. With that, we have some project financing that we've secured that takes away one of the big pain points for land managers.
You've got 3,000 acres, that's several million bucks to do all of that. Where's that money going to come from? Most folks don't have it and so that's something that we are able to remove that pain point so that we can really restore at scale and that's the mission of the company, make reforestation scalable. We focus only on post fire.
Chris Wedding:
Perfect. I think it's interesting for listeners to note that you started off by listing a differentiation, which is vertical integration, and then you listed who you serve before getting into your exact solution, let's say. Like who do you help and then solution. Then you closed with another differentiator. We only provide seedlings for post-fire habitats.
Grant Canary:
Yeah, I'll caveat that. There's a lot to crack open as far as who we serve. We serve small family forests, we serve timber companies, we serve tribal nations, we serve public lands, state, federal, local, county, and we serve nonprofits and conservation groups like the Nature Conservancy. So, that's what the land managers means.
Then Mast itself is the parent company to Silverseed, which is 130 years old, and we acquired it in 2021, and manages the majority of seed for the Western 11 states. And also the parent company to Cal Forest, which as you mentioned, grows the majority of trees for California. So, that's Sierra Pacific, that's Forest Service, that's CAL FIRE, et cetera. We're happy to be two really big pieces of the supply chain there. Then Mast does the carbon project development itself, utilizing that.
07:18
Chris Wedding:
Perfect. As you mentioned after my introduction, lots of threads to pull on there. So, if LinkedIn is correct, and we know it's always correct, it looks like you've been at Mast for almost eight years. Is that right?
Grant Canary:
Yeah. We got started in 2016 with some angel investors, City of Beaverton combining with some angel investors, that got us far enough to get into Techstars Seattle and then we started building up from there.
Chris Wedding:
Well, the reason I wanted to clarify that it was eight years is that you just referenced one of your, I guess you would call it subsidiaries perhaps is 130 years old, not eight, not 108. It's unusual, I think, for a company that is of your age and I think your maybe Series A was a 2021 perhaps. So, a company of your age with your Series A just a couple of years ago, buying a company that old, what details can you share about that process?
Grant Canary:
Yeah. Well, and this is one of my side missions too, is to get people up on the reforestation and how we're approaching it. Silverseed is this gem of the Northwest forest industry. It has this amazing seed bank that we've been able to expand 3X since the acquisition. In reforestation, nothing happens without seed and because I'm a masochist, I read the comment sections in a lot of places. One of the most common questions that we get is like, is it local? Is it native? Yes, and in fact, it's way more hyper local than people would assume.
The Silverseed was originally Manning Seed Company. It created these seed zones and the forest service adopted those in the 20s and updated them in the 70s. These seed zones, if you move seed significant distances, the survival rate will drop pretty significantly if not see outright failure. And so, there's this game of battleship that occurs. I'm referencing the Hasbro game, I think it's Hasbro. We'll say it's Hasbro.
Chris Wedding:
Probably with you. Yeah.
Grant Canary:
Where if there's a fire, the first question is like, well, do we have seed for that seed zone? And that seed zone is about the size of a county, but what it's denoting is the ecological factors. So, is it close to the coast and there's a lot of salt in the air, the water, the land? Is it high elevation because it's around the mountain ranges? Is East, West, North, South facing? North and South matters because think like, if you've got access to a deck or anything like that, if you're in the shade versus in the sun, the North space is going to get a lot less sun if you're in the Northern hemisphere. So, those are some of the factors that when you're on a mountain range and you're North of Shasta or Hood or Rainier, you're going to be seeing some of these factors come into play and the genetics of the seed have evolved with the site.
10:07
Most people would intuitively know like, great, don't take Doug fir seed from Northern Washington and expect it to grow really well in Northern California, even though Doug fir is native to both of those places. So, Silverseed has this massive inventory. It has that seed zone coverage so that when communities are impacted by fire, we can supply that seed and then what we've been doing is we've been building out the technological aspects of, how do we organize those seed collections better?
There's a great piece that came out on Wednesday in TechCrunch, it's a long form, it's got some video of what that software looks like, but it enables us to win at that game of battleship by saying, “Okay, we don't have seeds for those seed zones, how do we send more collectors to those seed zones and incentivize them to do so?” So, that's one of the big pieces there and one of the really important pieces around Silverseed and where the seed comes from.
Chris Wedding:
Okay, so that’s super interesting and it clarifies how difficult it is to replant where you talk about seeds, specialized, localized at the county level.
Grant Canary:
They're about the size of counties, but they're different. They're not counties. I just want to distinguish, I want to give people a visual for it, but you would imagine that everything near the coast has got its own seed zone. Then it goes inland and there's a valley, that's a different seed zone because of the elevation and it's got a different moisture profile, et cetera.
Chris Wedding:
Yeah. The microclimate for sure. Not literally the county boundaries, but I think the question that listeners are still wanting to know is, how did the tail wag the tiger, well, wag the dog, if you will? Like however politely you want to address that, how does a new startup acquire a much older company, well, to vertically integrate or do other things that are important for its go-to-market?
Grant Canary:
Yeah. Well, so we started off as DroneSeed, so some folks are going to know that name and what we realized was that we started off with, just like most people, a couple of ideas, two or three people and a drone and a PowerPoint. We assumed that there was this massive industry and it had seed supply all figured out, that's what our customers shared with us. And we realized that over time as we grew and became more and more important in the industry, that the seed supply was overwhelmed. What we've seen with the size and severity of wildfires happening and also what was the de facto solutions in the industry are not adequate for climate change. So, what do I mean by that? Let's talk about the size and severity.
12:52
This is from the National Interagency Fire Center. The 10-year average on what burned between 1982 and 1992 was about 2.5 million acres. You fast forward to today, what burned between 2022 and 2012 is about 7.5 million acres. So, that is a 5-million-acre increase, that's about the size of the state of New Jersey or in forestry industry terms, we'd approximate that to about five Weyerhaeuser’s worth of reforestation, which is deeply concerning because Weyerhaeuser is absolutely the behemoth in the industry. It's five times larger than any other competitors as far as land managed. It's bigger than many states.
You look at that and you're like, okay, great. So, the size is increasing significantly and what does that mean? It's like, where's all that seed going to come from? Oh, well in my high school bio I was taught, great, forest burns, forest regrows, no problems. We got this. Well, that used to be the case. Like 90% of the time, it would regrow if it was a low severity fire. I'm using very, very high-level numbers here. That's now dropped depending upon the species, the ecosystem to 40, 60% probability.
The reason for that is high severity fire will burn several inches down into the soil where all the seeds are stored and torch them. Whereas a low severity fire will go across like a creme brulee, if you will, and the seeds are fine and the forests will come back. And so, that is a double whammy of a problem. All of a sudden, the fire got way bigger and the de facto plan B of like, well, if I can't get the right species, I think that cedar is going to be a big market in 20 years on these trees. Nature will take care of it and maybe it'll give me some other species I'm less interested in, but it'll still be a commercial forest or still have ecological value. Well, that's no longer happening at nearly the same rate.
So, the industry has not really adapted to that and that's what we're doing. How do we scale out the software to be able to organize those collections so that we have the seed? Because both of those things are a big problem. Tom Porter, the state fire chief California was on 60 Minutes saying, “Look, a 10,000-acre fire used to be a career event for a hotshot wildfire fighter.” They'd see it once we'll say a 10-year career. Well, that means that the industry had 10 years to respond to a 10,000-acre fire and that means that they had all the time in the world to organize the seed collections, find some square footage in the greenhouse to grow it, get the folks out there on site to plant it, et cetera.
15:34
Now we're seeing, you see the August Complex fire, a million acres, we had a fire in Alaska, a million acres that didn't even make the press because it wasn't impacting a lot of people. It takes 250,000-ish acres to make the news. So, that's no longer where we are as an industry and so we need solutions to scale up and respond and that's what we're building. That requires better tools. It requires working with communities. It requires supporting those communities so they have resources.
Chris Wedding:
So, a lot of what you said is terrifying, but luckily you referenced creme brulee as an analogy for a fire. So, suddenly I feel like it's okay.
Grant Canary:
We found the one upbeat note.
Chris Wedding:
Exactly. Early on, you talked about carbon credits, I believe as a way to fund the reforestation. I think when folks go to your website, they will see that the reforestation can come at no cost to landowners, which is pretty mind blowing. It's like, wait, is that a typo? Who's there like copywriter? What's going on here? Tell us, how does that work? And I think as you tell us that I believe there’s going to be some really important nuance because some listeners have also seen headlines, which are not like screaming about the positives of nature-based offsets. What's the story, Grant?
Grant Canary:
Well, let me pick up from the DroneSeed side of things and get into the project finance, which we announced last week. On the DroneSeed side of things, we realized that, look, we are coming at this from one particular step in the process and we need to take on the whole process. So, we raised a really big Series A and it was like, we need to buy a seed company. Silverseed, the owner was retiring there and then we needed to expand the hell out of it, and that's really the first step in.
If we think about reforestation like an auto manufacturing plant, where is the line getting held up because one part of the process is super slow and the rest of the process hasn't even been gotten to yet and that's on seed. Following from there, you need a place to grow it. So, we acquired Cal Forest a year later, and that's where we announced at the end of Q4. Now we have a lot of square footage to grow in greenhouses. It's not enough. We sold out within the first couple of months of this year, as far as a lot of the space. Now we can still find more space. There's ways that we can operate and do that, but a lot of demand there and then now it's the last piece, which is, how do we provide all the capital to do the work, to collect the seed, to grow the seedlings, get them out to site? That's where the project finance comes in.
18:18
So, announced last week, $15 million, this is with carbon streaming. What this does is it enables us to scale up faster and that's the mission of the company, scale reforestation. So, reforestation, let's take our 3,000-acre project in Montana, it's going to cost, I'm not going to give an exact budget, we'll just say that it's 5 million to make the numbers easy. So, we allocate 5 million from that 15 towards that project. That project is going to take us probably about three years to execute in full, but we could talk about the why of that, but there's some assurances mechanisms on the carbon removal credits that we want to see there.
We do two more of those. Great, we've utilized that 15 million bucks. If we were funding this from venture capital, we've sold shares to finance that, then we're never getting those shares back. That's very expensive and we'd have to wait three years for the projects to provide the return on investment so that we could do the next projects. By having this project finance facility, we can allocate this 15 million to projects which we already have in our pipeline, do that over the next couple of months, and then go back out and find 50, 150 million in additional facility.
The capital's out there to do that. People want to see this work done. People drive to Tahoe, or their favorite ski slope or wherever, they see in their backyard that these forests aren't coming back at nearly the rate that they did in the past. And a lot of people, that's an emotional impact. They're like, “What's happening? Is that working? Where is this going?” You can pattern match it to coral, to glaciers, to other things that are just not coming back in the same way due to climate change. And so, this provides the capital to do that and this wouldn't be possible without carbon removal credits, the money wouldn't be there.
And so, I think this is a first of its kind facility, the project finance. We're an elemental accelerator company, meaning that we're in portfolio, they've invested and worked with us on projects. There's 150 other climate tech companies in that group and they have some awesome events that we go and the CEOs and founders all share notes. A lot of other companies are exploring this and need to go down this direction.
20:37
The reason is the old VC investor adage of, we don't invest in things with electrons, aka they invest in atoms, aka they only invest in software, well, that's not really going to work if we're trying to remove CO2 from the atmosphere. At some point, there's got to be physical work done on those modules. And so, on that basis, this is the cheapest source of capital to do that that's available today. And a lot of companies are headed down this direction for electrifying, for mineralization, carbon removal, for lime-based carbon removal, for direct air carbon capture.
I think like one of my side missions for folks is, we are a huge part of the supply chain for trees and for forests, but trees are not a silver bullet. We need all hands-on deck. And so, the capital's got to come from carbon removal credits and I've got more to say there as far as some of the nuance.
Chris Wedding:
That's a great start for sure. So, just parroting back some of that, you've got 15 million bucks in project finance. As that capital goes in, it gets a return on its investment by selling carbon removal credits, correct?
Grant Canary:
Yeah.
Chris Wedding:
Okay. So, who's a buyer of those credits? Are they certified or just a bilateral agreement? And what do price does look like?
Grant Canary:
There's a couple of standards registries out there. These are nonprofits. By and large this is Climate Action Reserve nonprofit, this is Verra, this is Gold Standard, they're doing the same thing as a US Green Building Council or any of those electronic certifiers. They're following the standards. Then we'll give you the big plaque or the seal on the side of the wall that says here, silver, gold, platinum and there's no tiering here, but it's like you followed it, now we'll issue the credits.
Under Climate Action Reserve, what we do is, there's a couple of assurance mechanisms for our buyers. Our buyers that we've shared publicly are Shopify, TIME CO2, Carbon Title, which is in real estate, a couple of others that are out there. What are the assurances? Number one, what's the additionality? These are burned forests. This is moderate to high severity burn. The seeds have been consumed in the soil. These are not coming back. Defined as less than 25% canopy cover. So, the additionality is quite clear. What's going to grow here? Most likely invasive species that are more likely to re-burn, that's not great.
23:06
The next piece is after the planting, we've got to wait a year for a third party to come out, verify trees are alive, right density, right species, because what we're making is a forecast of, what will the trees capture based on species, based off of geography, over the next 100 plus years? So, that's one of the big pieces there is like, we benefit in a big way that a lot of removal technologies are still getting their data sets, figuring things out.
We've done several hundred years of forestry and data collection, and then the trees themselves are a living library with their rings indicating how much they grow in an Arizona versus a Western Washington. So, we can make this forecast in the way that the timber industry's done with board feed per acre, but do it in tons of carbon per acre, based off of a mix of species, based off of where they're located. So, their third-party forester verifies it, sends it to Climate Action Reserve and says, “Yep, looks good.” This is a sampling mechanism. It's been used for hundreds of years in forestry.
The next piece is, and this is really what's one of the big things that is a differentiator to use the language at the top of the call here, there's a hundred plus years of funded monitoring. So, what happens with our project setup costs is that, there is a nationally accredited land trust and they get as part of the project costs, an endowment, just like a university, a Stanford, Yale. That is invested in the market that provides a percentage return 8, 10% a year. That funds an annual site report and a site visit every five years for the next hundred plus years.
That easement on the property is something that people have been doing for a really long time. In some cases, it's for tax benefits, depending on where it's locally at. In some cases, people really just don't want to see that land developed. It's been in the family for generations. There's a couple of generations and a couple couples in the family, and they want to make sure it's not going to get sold off, it's not going to get developed. And so, they'll put these things on independent of carbon credits themselves and that's something that's for our buyers is a really big aspect of things. Because these are US based projects and there's no lack of clarity about land ownership. It's very dialed in in that way, very low risk of encroachment. So, the land trust is monitoring for that hundred plus years. That's a big deal.
25:28
The last piece is every project contributes before the credits are issued, a percentage of the credits to an insurance buffer pool. I'll call it an insurance, but it's operated by Climate Action Reserve. It's functioning just like auto or health insurance and if there is a reversal, which is a technical term for a fire or something in the future, our buyers, Shopify, others, know that the credits they’re coming from our project or they're coming from the buffer pool, that pool that all the projects have contributed into. Again, this is just exactly how insurance in auto and health works.
Now, we believe that there will be fire on the site. It's part of the natural ecology. We believe our trees will live and it's not just a belief, it's very much backed up by the fact that we do a couple of things differently. We target much lower density. So, one of the big risks for public lands, for timber companies and others is really, really high stocking density because we haven't allowed fires to burn for a hundred plus years in any significant way. So, now we've got just this tinderbox out there in the forest and that’s not part of it. That's not how naturally these sites evolve with the ecology. So, by being at a much lower density, we have a much lower risk.
The other is, we utilize a polyculture, not a monoculture. I like to point to ponderosa pine. The bark is actually evolved to burn for a period of time and the tree will still live and it's kind of like a crushed bumper on a car. It slows down fire, which can lead to extinguishing, can lead to running out of fuel, et cetera, and that's one of the ways in which a polyculture is more fire resistant.
The last piece is, we collect that seed from as close to the fire site in those seed zones as possible. That is something that gives us, just a financial portfolio, you want to have the diversity to manage risk, we have the most diverse genetics out there for a site that those seeds have evolved for that seed zone. So that diversity gives us the best ability for survival. It's the opposite of genetically modified organisms where it's all great, things grow really fast and tall and provide a lot of two by fours, but then that one insect figures out the hack to get in there and boom, it's just across the whole landscape and that's a big problem. So, by doing those three things very differently, we're really creating true forests, true habitats and those landowners, those land managers, when they're working with National Credit Land Trust, they can do all the things.
27:59
They can hunt fish, they can put a hundred yurts out there, they can have hiking trails and dirt bike racing, but they've got to have a minimum quantity of trees that really fulfills that carbon forecast. And so, that's one of the big pieces that we do differently. So yeah.
Chris Wedding:
Well, that was a great tutorial on forest-based carbon offsets. Thank you, I learned a lot.
Grant Canary:
So, my editors are going to come in and save me here and be like, “We're going to tighten that up. We're going to tighten this up.” I mentioned we'd screw some things up.
Chris Wedding:
No, not at all. I think just to highlight four things you said as important, setting up an endowment that will allow these land trusts to measure and monitor for a hundred years, that sounds pretty creative. The buffer pool, if you can say, what percentage of the, let's say carbon credits or whatnot are put into this buffer pool out of the total possible? Is that sayable, knowable?
Grant Canary:
There's a percentage. I think it's going to vary a touch by project, so I wouldn't give a direct percentage, but Climate Action Reserve, that information is going to be available on their climate forward methodology. So, direct folks to take a look there and I can put it in the show notes after it.
Chris Wedding:
I think in so many words, what you did say was, “Forest going to burn baby, but guess what? We thought about that already.” Right? That's what a buffer pool is for. So, when you see the headlines, it's like, well, if the system was set up properly, that was already thought of. It was subtracted, if you will, before those credits were sold. Lower density of trees, therefore lower risk of severe fire and then polyculture versus monoculture. That's awesome.
Grant Canary:
Yeah, and here’s my side mission on carbon credits too. Let's take the John Oliver, let's take the Guardian pieces head on here. The John Oliver quote, like, at some level, you believe the carbon credits are BS and to that, I would say, “Well, hold on, hold on, that's a pretty broad brush.” Because if we look at ecosystem marketplace, there's 170 different project credit types from everything ranging from nature-based solutions like this to other technologies that are out there, et cetera, and they're coming from 100 plus countries. So, the idea that they're just all BS is a lot like saying that like, lending money at interest is just evil and we should never do it and it's BS.
30:25
There are ways to lend money that are super predatory. They're not awesome. They definitely don't enable people to do better things. They enrich just a certain minority of people and then there's other ways to lend money at interest where it allows people to buy a home, it allows people to grow crops in risky conditions with weather and others. And so, I think it's very similar here. There are definitely methodologies that are not moving the needle as much as we would like to see on mitigating the worst effects of climate change, but then there are all these other methodologies that are deeply needed to fund these technologies like ours, like nature-based that are very important.
The reason I'm very much like we need all hands-on deck is because I want to live in a bright future and that means we've got to take action, but money’s got to come from somewhere. If there's an opposition to carbon removal credits just across the board, then the bet that people are making is that it's all got to come from the government. It’s that it can't come from the private sector. I don't think that, at least in the United States, we have shown the political will to move fast enough.
The IRA is definitely a huge down payment on that, but that should have been done 10 years ago and we need to continue to move faster. So, harnessing private markets to do so, it's really critical and it should be both private and public. Not just a one or the other because clock is very much ticking and I'm deeply concerned about where we're headed.
Chris Wedding:
But Grant, nuance is not funny. I mean, John Oliver couldn't tell these nuanced stories and make a good joke, dude.
Grant Canary:
I mean, that's fair and it's way easier to just be like, “Oh, well then just kill that thing. It shouldn't exist.” Well, no. Whether it's nature-based, whether it's direct air carbon capture, whether it's mineralization, we've already emitted so much carbon in the atmosphere that absolutely we should be trying to not emit more. But if, magically, all humans were gone tomorrow, we're on another planet, we never existed, whatever, all the ecosystems would still go through climate change. I think most people listening to this already know that, but that means we've got to do removals and we've got to stop emitting and it's got to be both.
32:46
I love what Stacey over at Shopify has said, which is like, if you're focusing on better physical health, the optimal is to not focus just on diet or just on exercise. It's to do both and that is the fastest route to improving health. I think it's very much the same thing with emitting and capturing and removing. The removing can't happen without credits. The money's got to come from somewhere.
Chris Wedding:
Yeah, and I would just direct listeners to Google a term called committed warming, which is what you what you’re describing where the greenhouse gases emitted to date, I mean, I forget the exact number, but I think it means 1.2 degrees C is already quote unquote, baked in, pun intended. I mean, obviously there's error bars and such on that, but yeah, it's got to be mitigation and removal.
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Okay. So, we could talk about Mast Reforestation and carbon removal credits or maggot farming for much longer, but for time purposes, we're going to switch from the company to the person. Grant, tell us one or two beliefs that are very important to you that have influenced where you are right now. This can be about business or maybe not about business, but so influence where you are with building Mast Reforestation.
Grant Canary:
What at least I hold is that climate change is the problem that all others report to, and that can be a controversial statement because there are a lot of people working on a lot of really important problems. They're like, “Wait, what?” And where that comes from is very much a deep respect from people working on other problems. They don't get any additional time on the clock if our political, our economic, our social systems are failing due to climate change, which we can see as historical precedent with the Dust Bowl in the United States, with the great hunger in China. All it takes is in that instance, millions of people die due to malnutrition because of one, some choices on economy and two, some really bad drought. That was in China.
35:47
We could see in the Dust Bowl -- I think the pandemic definitely brings home the like, “Oh man, that whole thing about the influenza and things like that back in the day, isn't that cute? Isn't it so nice that we've gotten so much farther advanced in medical?” And then I think the pandemic is like, “Nope, still at risk.” That highlighted that in a really big way and the same thing is with climate, there is definitely a world in which we see mass migration from the Midwest or some other part of the United States to somewhere else. That’s where my North star is.
A high school English professor helped me find that and then later on in life, friends, colleagues helped me put that into that nice tight phrasing, which means a lot to me personally. Just climate change is the problem that all other problems report to you so that we can have more time on the clock to work on and mitigate and better all these other really important things that we can all agree on in medicine, in democracy, in so many other areas. But we just don’t get that time if people are worried about where's their family's food going to come from.
Chris Wedding:
And if you look back at these various roles you had, either in different sectors, whether it's US Green Building Council or food waste to insect larva to fish, overseas perspectives, et cetera, what's an example or two that you've taken from those prior experiences that have shaped again, how you're building your current company?
Grant Canary:
Well, I mean, let's take the maggot farming.
Chris Wedding:
I hope you would. I mean, yeah.
Grant Canary:
What was I doing there? I was taking food waste, feeding it to insects, turning it into industrial protein, not cricket bars or anything like that, but industrial protein for fish feed. I'm very much coming at it from a macroeconomic perspective, which is, I did a master's thesis at Universidad de La Sabana in Bogota. I did not want to incur all the debt in the United States that many people like my brother have incurred. I figured out a way to do that abroad, arbitrage, and still get a master's degree.
37:52
As a part of that, I advanced the knowledge on how to get a specific species to reproduce in captivity and then how to feed it food waste and built a pilot facility, taking food waste in Bogota and feeding it to the insects, getting them to reproduce in captivity. So, I closed the loop on how to get more insects and then harvesting them, cooking them, turning them into protein, and then synthesizing that all, putting it on the web. That's a couple of companies, the insect, AgriProtein, others hit up my blog way early days in the early 2000s. Love seeing that they're out there growing and getting stronger because we are overfishing the smallest species that turn into protein for salmon and other farmed fish.
And so, that's one of the big takeaways I had was, what's the economic drivers? Why does this make sense? If we're overfishing, I did an economics simulation to see what would the price of fish meal, this global commodity, small ground up fish, go up to if farm fish needs it to cultivate these other species? I analyzed and said, “Hey, I think this price could go way up,” and it did over the next five to six years following the model. Then I was like, “Great, well, what's the comparative good? Insects. How do I not replicate some of the problems of the past? How do we utilize a waste to create a product?” And that's where I was taking the food waste, feeding it to the insects.
We waste a lot of food, most people are probably aware, for good and bad reasons, for both sanitary reasons and just supply chain inefficiencies and refrigeration and a lot of other pieces. Great, feed them this waste product and get the protein back into the food supply faster. And so, following all of that, that's really how I built my first company. It was acquired and from that, we built a 6,000 square foot pilot and then a 60,000 square foot pilot. And so, that's really one of the progressions there of how I got my first crack at building out a company focused on a problem and then analyzing the hell out of it. Utilizing the macroeconomics and then figuring out what were the ways that I could get the supply chain to work for me.
And that's something similar that we see happening with Mast Reforestation is like, great, what are the drivers? Who are the players? How do we do some of that product management to get the supply chain to work for us?
40:21
Chris Wedding:
I'm not sure whether listeners more want to hear about grad school arbitrage by the Oregonian heading to Columbia or the nuances of growing and baking certain insects for fish feed. By the way, which insect was it?
Grant Canary:
Hermetia illucens is the Latin name and black soldier fly is the common name. You see a CSI episode these are the things that show up after 30 days on a corpse. They can eat some of the really nasty strains of E. coli and salmonella. They can be submerged in rubbing alcohol for a period of time and live. They are nigh indestructible and there's some other fascinating facts. I actually think that they're super cute. Most people are like, “That's disgusting,” but like you cultivate them long enough and you're like, “Oh, they're so cute in their little larva stage.” That’s the type of person I am. So yeah.
Chris Wedding:
Listeners can't quite see what I just saw, but I think you just turned into like a 12-year-old, maybe six-year-old boy with a stuffed animal, like, “Oh, these black soldier fly larvae.” They once took over our vermicomposting bin out back and my wife calls one day she said, “We have a problem with these aliens in our compost beds.” I was like, “Honey, first of all, cool picture you sent. Also, it's totally fine. It's totally fine.”
Grant Canary:
Yeah. They make great chicken feed. So, for people who are interested in the backyard and their composting bins have been taken over, that happens in the summer depending. You can get a little bin and they'll climb up a ramp and just drop themselves right down into a bucket, great chicken feed.
Chris Wedding:
Well, when you said chicken, I thought you were going to say they taste like chicken.
Grant Canary:
Oh no, they taste terrible. Don't eat them.
Chris Wedding:
He's tried them. He's tried them folks. Grant, maybe the final two things here, give us a recommendation, a book maybe, podcast, tool, et cetera, that you think listeners could find value in.
Grant Canary:
Mystery for the Future. One of my favorites. It's one of the few out there that is not a dystopian future. It is very much a bright future. The first third is dark. So, I encourage folks to get to the second two-thirds. Everything I've done has been in sustainability and I've definitely come from the place of like, the bombs have already landed, greatest generation. It's not like nuclear weapons. We're already incurring the impacts of climate change. This isn't something that we can solve or avert, it's mitigate.
43:02
So, I'm coming from a very dark place on this, but in communicating this to other people, what people need in my mind, or the thing that is most effective is communicating a future to fight for it, that people want. I don't think many people want to live in the walking dead or any of the other dystopian futures. It might seem fun for the first two weeks, but no, after that, it's not fun anymore. Think about all the things we enjoy and what we will miss most, that is the loss aversion is not nearly as much of a selling point as, oh, I want to take an awesome blimp ride. Instead of taking a flight, I would love to take a cruise ship across the Atlantic that's on a hydrofoil and watch dolphins while doing like Zoom meetings on the back deck or whatever. It’s not a business trip. Like it's not a Disney cruise, but you get across.
Those are some of the examples and I think that we have one of the co-founders of Tesla on our board, Marc Tarpenning, and they looked at it. He's got a great thing on YouTube, this is going to be my second recommendation, people should watch his YouTube analysis. You could check it out for Spiro. When they got started on Tesla, they analyzed all of the electrical vehicles out there and it was like, you had to like pay this penance to drive a Dormobile with three wheels, et cetera.
Now I drove a Prius until very recently, I’m not a car nut, but people shouldn't have to pay a price to drive an electric vehicle was their thought. They looked at all the fuel sources and they're like electric makes the most sense and they went for there. Then they figured out how to drop the drive train into a Lotus and make it super fun to drive, and that's the future that people thought for. They combine these two audiences. One being all the people are like, “I don't care how it drives. I just want the fuel source to not be awful, not be running on a global political system that prioritizes oil.”
Then there's this other side of the people who are like, “I don't care what it runs on. I want it to be amazing, fun. I'm a gear head. I want it to be the most amazing car with a ludicrous mode, yada, yada.” Or if you pick the trucks and the Rivians, it's got all these features, et cetera. Those two audiences combined, there's the Venn diagram to allow them to combine forces and move forward, it’s one of the most powerful things out there.
45:27
So, Ministry for the Future, that's the bright future. It's one of the few out there that paints that future. And so, we need the art, we need the bright future, the focus, and you can check out Marc Tarpenning for an example of what that looks like.
Chris Wedding:
Those are both super useful. I would just mention that Ministry for the Future is the most recommended book on the podcast. I'd also say that, yes, you're right, the first part is dark, but that's actually part of the benefit. I'm not a fiction reader. I'm not sure whether that's a feature or a bug, but I'm not a fiction reader, but painting that picture of what a shitty, we didn't do enough for climate change future looks like makes all this feel much more urgent, but you're right. It does end on a more positive light. No giveaways here.
Grant Canary:
Hey, one of my other side additions is recruiting as many people into climate, whether it's with us or elsewhere. So, if Ministry for the Future is one of the top, I would love to suggest to people embarking on a journey into climate, especially if they're coming at it from the startup space, we need you. Even if you're coming from oil and gas, we need you, especially for geothermal. I could suggest also Lean Startup was instrumental for me, Eric Ries, one of the combined Six Sigma with a startup and that resulted in what we now have as product managers.
You hit on it earlier, some of the three things that really helped me in my journey were chess, being able to think ahead and plan out moves. Poker, analyzing that you can think all you want, but there's still probability and you don't control everything, so you better be able to make bets and place bets, how you think about that, and improv. Improv has saved me so much time as a business executive in being able to run an organized meeting, make a cohesive pitch, have fun with the pitch, and allow it to communicate. The last thing I'll say is hard thing about hard things, it's a hard journey being a founder of whatever role you're in and that book does a great job of giving the road ahead and some things that may or may not help.
Chris Wedding:
Grant, man, the guest who just keeps on giving. Just when you thought he was done, dropping four or five more wisdom bombs. No, seriously, those are great. Couldn't agree more with all those. Hey, listen, we're all rooting for the success of Mast Reforestation. Keep fighting the good fight, man.
Grant Canary:
Hey, thank you and please come join us. Please keep listening and please recruit folks and then vote.
48:07
Chris Wedding:
Preach. There you go, man. Later.
Thanks for listening and if you want more intel on climate tech, better habits and deep work, then join the thousands of others who have subscribed to our Substack newsletter at entrepreneursforimpact.com or drop me a note on LinkedIn. All right. That's all, y'all. Take care.
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