00:00 From newsletter to industry body

Climate Salad. Yeah. Amazing. What do we call it? Is it an organization? Is it a venture? Is it a movement? I don’t know. What do we call it? Yeah. Now we’re four years in. We’ve got 800 climate tech companies. 800, 200 members, about 125 investors, 150 mentors. And our goal is to help Australian climate tech companies go global. Australia produces a lot of great technology, but we don’t commercialize nearly enough. People keep saying to me, we punch above our weight.

Do you think it’s harder for climate companies to go global than others? We need 10,000 little changes and actually if you think about 8 billion people on the planet, we’ll do 100 things a day. You know, that’s 800 billion little little behaviour changes. We will not look back on any investment we make now negatively. We will absolutely say, I wish we did more.

01:20 The accidental founding of Climate Salad

So, Climate Salad. Yeah. Amazing. What do we call it? Is it an organization? Is it a venture? Is it a movement? I don’t know. What do we call it? Well, look, the backstory is it was supposed to be just a newsletter. So, yeah. So, I 9 years ago, my my best friend in the world pushed me into climate innovation, said that we need 10,000 innovations. I’m like, okay, that sounds like a problem to solve over the next 20 years.

And then four years ago, four and a half years ago, I was working with about 12 companies just I’d done a little bit of investing, supporting them. And every time I told someone about these companies, like they would just be blown away, like Ceil Earth or Go Terra or MJ Thermal. And I’m like, I need to tell people about this. So I started a blog, like literally 45 minutes, my wife and I, one weekend, she’s an awesome marketing person.

Created this blog, created this newsletter, put it out, and we got like 100 responses and 25 new companies contacted me. And then by the end of the year, we were at 112 companies. Like 100 companies within a 5 month period. That’s nuts. And then the government contacted us, New South Wales government said, “Can you and your team run a program?” I’m like, “There’s no team. Like there’s nothing here. It’s a newsletter.” And then we turned it into basically a membership based industry group focused on Australians who are building global solutions to big climate problems.

And Salad is the whole it’s a mix match of things together. A lot of people rang me up and told me it was a terrible name. And I’m like it’s just a newsletter. Don’t overthink it. But it has been pretty good. Someone did think we were a catering company once. But it’s green, it’s multicultural, it’s mixed, and we should have more of it.

03:06 Mick’s background: from nerd to climate founder

Yeah, briefly. I was a total nerd as a teenager in computers, networks, databases, everything. That got me onto the internet before it was even a browser back in the early ’90s. Bulletin boards and then built a couple of websites and started a web development agency.

Then got into tech startups and then I really loved working with multiple companies. Just down the road actually here in Surry Hills we started Pollenizer back in 2008. Phil was my partner. He’s now the partner at Main Sequence. So we started Pollenizer back then with a view of doing almost what we’ve done in Climate Salad in tech which is Australia deserves a great tech industry. Let’s support it. We did 25 tech companies in about a 7-year period. Two exits, two still going. LawPath’s doing brilliantly.

So that was great. And then we were co-founding investors and mentors of Startmate. And then Telstra asked me to come and set up a tech accelerator for them with Andy Parker and Charlotte Yarkoni. That was Muru-D. And we had all these companies going to the US and they said go to the US and help the companies on the ground. So my wife and I and three young kids moved to San Francisco 2016. It wasn’t the best time to go to San Francisco, let’s be honest. But it did change my life in a really good way because a certain person pulled out of the Paris agreement for the first time.

And then my friend nudged me into climate. And then I started working with universities over there, Berkeley, Stanford, Singularity University, and the Wcomator program. And then I moved back to Australia 2019. Did a couple of years with BCG Digital Ventures. And then I really wanted to work on climate so I left to focus on climate technology work.

05:33 Australia’s commercialisation crisis

800, 200 members, about 125 investors, 150 mentors. And our big goal is to help Australian climate tech companies go global because one of the things that’s worth digging into is that Australia produces a lot of great technology but we don’t commercialize nearly enough. I keep people keep saying to me we punch above our weight and I’m like we punch nowhere near our weight. We have massive advantages. Such an incredible potential opportunity and we do well based on our size and distance, but I think that is a missed opportunity.

Do you think it’s harder for climate companies to go global than others? Because they’re often, you know, we’re not talking about a SaaS software that just rolls out and sells to B2B, right? Absolutely. There’s a lot more complexity. They’re often physical businesses and there’s a lot of cost and all that kind of stuff.

06:37 Why hardware is harder than software

Huge. So there’s two big barriers. One is that climate is not fully appreciated and valued. The reality is that those are established categories. The simplicity of SaaS, even though it’s very very hard to do, is start a company in Australia and focus on the US. And 99% of businesses do that and they’ll have a decent chance. But, as you said, in climate, a third of the companies are software, a third are devices. So, it’s $100 to $20,000 products and then a third of them are infrastructure based, which is even more difficult to grow.

You look at companies like Goterra, an absolute alchemy magical company. They take they use roboticised machines that have maggots in them to eat food waste for Woolworths, Lendlease, and Hyatt. And it turns it into chicken feed and fertilizer. That’s a magic product, but it’s a bio-engineered product. You’ve got to install it. It’s messy. There are maggots involved. Like it’s full on.

It’s not easy to sell maggots to investors. No, but you’re selling massively reduced methane, which again the world doesn’t fully value.

12:14 Capitalism vs. climate change

It’s interesting to talk about solving a climate problem with a capitalist solution, but I think we have to. So some of these products getting capital into them and turning them into great businesses is probably the fastest way to actually get outcomes. And that’s really important because instead of saying, “Please buy my product. It’s not as good and it’s 20% more expensive, but it happens to be better for the environment,” what we’re seeing now is, “Buy my product. It lowers your risk in the long term. It can save you money and it’s better than the alternatives.”

Go Terra is a good example. Instead of taking your waste, now policy comes in and says you can’t just throw all your waste in landfill because of the methane costs we’re going to charge you x dollars per ton. That’s expensive. Well hang on, put it in a Goterra machine and actually it’ll produce chicken feed and fertilizer on the other side and we’ll charge you one tenth of that. That sounds like a really good outcome and the CFO is happy. You can’t just do it for the sustainability people. The CFO and the company has to go that makes economic sense.

We’re not going to dismantle that and get to degrowth any time soon. We need to work with that system and make a lot of changes by making better products.

15:53 The investment Valley of Death

There’s really good support at the very early stages. Lot of accelerators, a lot of university programs and there’s literally trillions of dollars at the late stage. Nothing in the middle. And it’s really hard in the middle. And the reason is still about timing because investors would rather pay 3, 5, 10 times more for a company or a product when they know it’s leading and going to win than to take the risk too early.

So there’s a big especially with clean tech 1.0 with solar and EVs, a lot of people lost a lot of money and so therefore people are waiting till it’s definitely real and then they’ll pay extra and corporates are the same. Even as you said because hardware you know so expensive a series A for a software company could be 3 million bucks. We’ve got series A’s, 60 million bucks series A’s. Like V2 Foods was a $85 million series A. We’ve got Sakona Batteries, Electrify, Allegro Energy, MJ Thermal. These companies are $100 million products.

So we talk about it being slower to a million but faster to a billion in revenue. But that means that the capital requirements are significantly higher and actually then they’re more complicated in terms of they need debt financing and infrastructure financing. Everything’s more complicated.

17:54 Jet engines running on sewage and infinite thermal batteries

A few really quickly. One, Capricorn Power. Some guys who’ve been in the energy system industry for a long long time. They’ve basically used a jet engine and made a version of it. It’s a recuperated Brayton engine which can take waste products and turn it into 24-hour electricity. Do you remember Back to the Future 2 where he comes back and puts stuff in? Barwon Water in Victoria, they’re trying to do a deal with ARENA and Capricorn Power. It processes sewage and has these massive energy needs. They can actually put sewage in the front end of this engine and produce electricity out of the sewage that they’re actually processing. 24 hours energy. That’s amazing.

And the second one is MJ Thermal out of Newcastle University. Two material scientists mucking around with aluminium and graphite and they create this brick which basically contains its shape and you heat it a bit and it stays really hot for a long time. And the incredible thing, so it burns like coal, except the next day it’s still sitting there. And you know what you do again? Use it again. You can use it hundreds of times and then when you’re finished with it, you can recycle it and turn it into a can. So like that is alchemy. And they are out of two material scientists out of Newcastle University, a coal town that is now booming.

19:33 The generational divide: nature first

One really important thing is you and I, even though we look really, really, really young, there’s the younger generation. They might be digital natives, but they’re also environmental natives. So, I talk about making stuff less bad. They talk about nature first, and that is a different perspective. So, I think it’s brains and a perspective change. My dad is a massive climate denier. Thinks it’s all made up because scientists can tear down these fossil fuel industries. But actually my three kids, they are nature first. You don’t have to convince them that there’s a problem. They’re like why aren’t we doing it with nature? Because I kind of like breathing. I like drinking water and I need food. Like reasonably important for humans.

Can everything in our lives become sustainable or are there things that we should just actually get rid of? Yeah, there’s a big difference between doing less bad. There’s definitely better ways to do coal. You can make it more efficient. You can do carbon capture and storage but it’s less worse versus solar and wind. I think there are some things which we should just stop. So definitely consumption. The issue is consumption. If you look at the 8 billion people on the planet it’s actually the Americans, the Australians, the English, the Canadians that consume like 3 to 10 times the average. We would need like six earths if everyone consumed like an Australian. It’s like 12 for the US or something.

There’s no silver mushroom in getting the world back to climate positive. We need 10,000 little changes and actually if you think about 8 billion people on the planet, we’ll do 100 things a day. You know, that’s 800 billion little little behaviour changes. But I think it’s totally doable.

26:19 The 2027 tipping point prediction

I think there is incredible belief that we are about to have a positive tipping point. And my view is it’s going to happen in 2027. And the reason I say that is I’m an old geek who’s been through a lot of innovation waves and I know what it feels like before it’s about to take off.

So Phil and I back in our Pollenizer offices when we’re sitting here going we’ve got engineers, we’ve got entrepreneurs, we’ve got technology, we’ve got platforms and tools. We’ve got the essence of what we need to go and build this and out of that you have Startmate and Blackbird and Canva and all these other things come out of it. I think we are just ahead of that.

And on the negative side, the problems are actually driving policy change. And no matter what you think about the national narrative, global policy is absolutely moving in this direction because you can legislate against clear problems. There’s too much plastic in our bloodstreams. We’ve got to legislate against that. People are dying from pollution. You can legislate against that. So that legislation is increasing over time. So you’ve got policy-driven growth and then you’ve got more customers because of policy but also because of problems.

And the final thing is the technology is getting better and better and better. So instead of saying, “Hey, buy my product. It’s 20% more and it’s a bit crappy, but it happens to be good for the environment,” I’m saying it saves you money and makes you money. So those are the three things why I think 2027 is going to be the big tipping point. Policy is driving more customers and more customers is driving better technology and that’s all going to tip over.

Think about your own body temperature. I’ve got kids and they can be hot after a sports game or they can be cold in winter, but if you get the thermometer on them and their temperature’s gone up one and a half degrees, terrible. You’re taken to the hospital, right? And that’s the way to think about it. It’s the regulated temperature, not weather. Those are two completely different things.

We will not look back on any investment we make now negatively. We will absolutely say I wish we did more.

35:43 Antarctica and the fragility of nature

So you said you’re going to Antarctica. Yeah. Going in January. It’s been on my bucket list for a long time. I had a goal before I turned 50, I wanted to get to 50 countries. Prior to COVID I was on track. I’m now sitting at 48 countries and five continents. So, next year I’m going to Chile and then Argentina and then down to Antarctica and I’ll be seven continents, 50 countries.

I was winging about it being on my bucket list to a good friend of mine, Leona Watson. She’s an incredible business coach. She’s been twice and she’s like, “Hey, let’s get a group of people going down.” So, we’ve got Anastasia from Regrow, Paul Fox from Eevee. So, we’ve got a bunch of climate people and we’re going to go and spend two weeks on a boat and see this incredible experience of Antarctica.

20 years ago, I climbed Kilimanjaro in Africa and I saw the glaciers up there and on the top you’re only there for 5 minutes and Jeremy, my guide, was like basically, you know, Mick, it’s melting. He said it won’t it might not be here for your kids. And I was like, whoa, we had this really incredible moment. That was before I totally got into this. And then four years ago, I was up in Cairns and I got taken by some marine scientists down and saw the coral reefs and they showed me the bleaching.

I want to have deep and meaningful conversations and I want to be shocked by the beauty and fragility of nature. And that’s what I’m hoping to see.

This transition is well underway. So if you think it’s not going to affect you, then I think it’s worth thinking about whether it does. What does water cost affect you? What if you export a product into the European Union? They have CBAM kicking in next year which means everything gets taxed on its environmental cost at full cost.

The really easy things anyone can do is to move your super over to Future Super or Australian Ethical. Like that is a huge signal because it’s about a 20-year investment. You’ll still get a great return and it’s going to be more likely to go to positive sources than negative sources.

The biggest change that can happen in Australia is if we can get Australian companies to buy Australian innovations. That is the biggest thing to unlock. Quickly compare the difference between Atlassian and Canva. Atlassian was started significantly earlier, no investors from Australia. Canva, seed investors, series A investors. The return of value to Australia from Canva is massive because it’s 10 years later and was done when the ecosystem was at a different level. That circularity of value in Australia when Australians buy Australian innovations is the biggest unlock by far.

Join climatesalad.com. Be part of it. I think we massively underestimate our influence and I’ve never failed to show someone how they can have a really positive influence. So challenge me. Thank you so much. It’s been fascinating. Thanks, mate.