Offstream: streamlining carbon compliance for clean tech project developers
Despite a growing amount of funding (to the tune of $2T annually) flowing into new decarbonization projects, it is incredibly challenging for project developers to complete the paperwork needed to access that funding.
Today, carbon project developers navigate a complex web of credits, regulations, and market standards. This information comes from local, state, and federal governments, NGOs, industry coalitions, and investors. It’s hard to track, constantly changing, and mission critical for a developer’s P&L.
Five years ago, Varsha Ramesh Walsh struggled through carbon compliance as a project developer at Indigo Ag. While she was at Harvard Business School, she spoke to hundreds of developers with the same challenges she faced, who all asked for a solution to their compliance bottleneck.
Zach Janicki brings many years of full-stack software engineering experience at early-stage startups across compliance, legal, and accounting. He’s adept at building scalable products that replace people-intensive workflows.
Varsha and Zach bonded over their shared north star of climate and love for “pragmatic problems”, including compliance. We recently sat down with both of them, fresh off of their YC demo day, to get into the weeds about how carbon compliance is being managed and where Offstream sits within the ecosystem of solutions. They hope to empower trillions of capital to flow towards high-impact industrial scale decarbonization solutions sooner and with confidence, using their their platform.
What is the biggest misconception about how carbon compliance is being managed today?
Often, people read “compliance” and they expect that all of carbon compliance is regulated or set by the government. In reality, compliance (in many industries, not just carbon) is defined by a mix of regulations, private sector organizations, and industry coalitions. That complexity makes it 10x harder for project developers to navigate as it’s hard to know what compliance even is, let alone how to get compliant.
In addition, folks are often shocked to learn how much data for compliance reporting is tracked and reported on through Excel and emailing PDFs back and forth. Some of Offstream’s customers are new to carbon project development. Others have been developing and selling credits in compliance carbon markets for a decade. Many standards have been around for a while, and customers have just accepted a suboptimal process and status quo to manage reporting, because software wasn’t truly possible at scale until now - thanks to LLMs.
Is Offstream’s carbon compliance software scalable and one-size fits all?
Our platform is scalable by design, thanks to careful architectural choices that Zach and our engineering team have made. We see lots of common data and reporting requirements across different aspects of carbon compliance. Our product is great at getting that data from customers both upfront and on an ongoing basis, and we use that as a jumping off point for compliance reporting.
We are not one-size fits all to our customers, and that’s a feature not a bug. Our customers value seeing a specific, actionable set of steps for their compliance journey. Our job is to build one platform that delivers this specific experience to hundreds of customers.
What has been the biggest challenge in building a software product geared towards clean tech development?
Clean tech development is attracting thousands of new participants every month - it’s a new market with regulatory change. The biggest challenge has been choosing a specific focus area and sticking to it. There is so much new capital flowing in, new technologies coming online, and directions we could sprint in. As a seed stage startup, however, we need to focus. We’ve been able to overcome this challenge by prioritizing market areas with high need and higher maturity. That’s the reason we’ve been focused on bioenergy developers, which include developers who are producing biochar, energy, and often fuels and heat all using biomass (e.g., wood waste, agriculture waste, and more).
Focusing on where we are now despite the exciting growth in the space continues to be a challenge, but it’s one we’re up for! We can tackle all of global industrial decarbonization in short order, but continuing to focus on the North American market and sub-segments, will give us the fastest path to scale.
Zach and I are excited for this next chapter in Offstream’s journey, and look forward to partnering with the Collab Fund team!