Startup employees often go on to found interesting ventures, basing their new work on the experience gained from their time building a company from scratch. But not all of those experiences are positive, and sometimes, a less-than-satisfactory exit can do more to fuel a founder’s fervor than anything else.
In the case of Forward Earth’s co-founders Cari Davidson (CTO), Giuseppe Gentile (CPO) and Micha Schildmann (CEO), one could say that’s almost what happened. The trio were previously C-level executives and early employees at carbon accounting startup Planetly, but they weren’t very satisfied with their exit when that company was acquired by risk-management platform OneTrust in late 2021.
OneTrust had said the acquisition was part of a “heavy investment” into ESG, but less than a year later, Planetly was shut down and its staff laid off.
The three co-founders were less than impressed by that outcome — so they got together to have another go. This time, they took an AI-centric approached, aiming to solve as similar problem to Planetly, but more for the ‘long tail’ of companies than the larger ones. The startup has now raised €4.5 million in a seed funding round that was led by London-based Mosaic Ventures. Speedinvest and European impact VC, Revent, also participated in the round.
Chandar Lal, a principal at Mosaic Ventures, told TechCrunch his firm had been looking for a company that took an AI-first, automated approach. “We found these guys who obviously had a chip in their shoulder after an exit that they weren’t quite happy with when they built the first version in this market, Planetly. They sold that to OneTrust for about $100 million or so, but didn’t see much of the upside, economically, from that. And so they basically said, ‘Look, let’s start again, fresh, blank sheet of paper. Now that LLMs exist, how would you go about solving this problem?’”
The startup is entering a crowded space — competitors like Climatiq and Greenly, for example, already help companies calculate their carbon footprint and emissions, too. But the founders’ experience in the space will no doubt stand them in good stead, and Forward Earth is hoping that its AI-driven approach will enable it to cater to the long-tail of the supply chain, which others find hard to reach.
Forward Earth says its AI platform can calculate complex CO2 footprints for its clients based on their data. The startup also focuses on the supply chain, letting companies get a look at the carbon footprint of their suppliers as well as those who supply them.
Schildmann told TechCrunch all this normally requires a big team from a consulting firm to achieve and is hard to scale for mid-market companies. “Most solutions focus mainly on large companies,” he said. “That means they basically have a very complex, investigative solution that is very costly to implement. But you need to have the data from the suppliers to actually get real transparency and comparability.”
Without that data, Schildmann says, companies end up making too many assumptions, which is where Forward Earth’s AI and data generation capabilities come in. “We decided to make it super easy for all of these mid-market companies to generate the data and leverage AI, so it’s very automated (…) We integrate our software into the existing software companies that already do supply chain management, compliance management, procurement management.”
Schildmann even calls this a “Trojan Horse” go-to-market strategy, where the software is distributed via other supply chain platforms already in the market. The platform can also help companies with reporting requirements mandated by regulations like the EU’s Carbon Border Adjustment Mechanism (CBAM). The company currently operates in Europe and the U.S., and is planning to expand to Asia.
“We think this one’s a totally new take on this market,” Lal said. “In order to use Watershed [a competitor], you need to be of the scale and have the budget that you can basically hire one of those people to come into your organization and do some calculations, just as it would be if you were hiring a consulting firm. And so that’s really the kind of cost inefficiency that means the mid-markets are not getting served here. So that’s hopefully what this AI approach opens up.”