Episode 20 Transcript: What Goes into that Pool You’re Building

Molly Wood Voice-Over:

Welcome to Everybody in the Pool, the podcast for the climate economy. We dive deep into the climate crisis and come up with solutions. I’m Molly Wood.

So last week we talked to Cody Finke of Brimstone, about their cement replacement technology … this week we’re going to keep talking about this kind of umbrella concept … a term called the built environment.

This refers to basically … our human-created world … and it’s a common term in architecture and infrastructure specifically.

For today’s purposes … let’s just talk about buildings … according to Project Drawdown … buildings are the fifth biggest emitter on the planet … the top categories in case you’re wondering …

Are electricity production … food, agriculture and land use … industry … transportation … and then buildings … which account for about six percent of global emissions.

But I digress …

So buildings … on the one hand you have lots of cool innovations in building materials and energy efficient construction and windows and insulation …

on the other hand you have builders and developers who … have no idea how to find that stuff and measure its impact … even though their investors and customers … might be asking for it. And they certainly don’t know how to quantify any of it … to those investors or customers.

And that’s where today’s startup comes in.

Nicole Granath:

I am Nicole and co-founder and COO of Tangible. We are incredibly excited to dive a little bit more into Tangible itself, but my background in short is that I used to run sustainability for a flooring manufacturer and found my way to the space through that in realizing what a need there is for scalable software solutions.

Anneli Tostar:

I am Anneli Tostar, co-founder and CEO of Tangible, and Nicole and I met 11 and a half years ago, something like that, long time ago now. But my background is in the built world and climate space, broadly speaking. I’ve worked for nonprofits, for-profits, consulting firms, you name it. But have really been focused on how do we change the way that cities are designed? How do we change the way that buildings are?

Tangible got its start actually … as basically a spreadsheet that Anneli created … trying to become a database of more sustainable building materials … because honestly THAT didn’t … and doesn’t … even exist. But things grew from there …

Molly Wood:

Start by asking what the company does and then we'll kind of back out from there to the size of the problem and how you came to it. Um, who, who wants to tell me what Tangible is working on?

Nicole Granath:

I am gonna volunteer my co-founder to, uh, set the stage. Yes, we gotta take advantage of being your first two-person podcast.

Molly Wood:

To pass the buck.

Nicole Granath:

Yeah, exactly.

Anneli Tostar:

Yep. I'll take it. Uh, so it's hard to talk about Tangible without talking about embodied carbon. Um, so I'm gonna briefly hit on the problem space. Um, but embodied carbon is carbon associated, broadly speaking, with building materials in the built environment, and they're a huge problem. We'll talk more about that.

Um, but it's very hard right now for real estate owners and developers to wrap their arms around the problem and actually understand what to do. And so Tangible is a software platform focused on demystifying embodied carbon for real estate owners and developers, and helping them to drive action to decarbonize their development portfolios.

Molly Wood:

Tell me a little bit more about the, I will confess here too that when I talked to Anneli, it was maybe only the second time I had heard the phrase "built environment." So, um, dig in a little bit for us about more about what that means in terms of the physical world and how, uh, you started to see that this was an issue that needed to be tackled.

Anneli Tostar:

Yeah, so one of the oft-quoted statistics in our space is that the built environment or buildings are responsible for 38% of all emissions globally. This is a massive chunk of what we as a society need to address. Embodied carbon is a big part of that problem that has not yet really been tackled in a scalable way.

And so thinking about the context of how we as a world are going to actually decarbonize, it has to start with the structures that we're building, refurbishing, retrofitting, and ultimately asking ourselves the question of what type of world do we want to occupy, and how do we build those aspirations into what actions we're taking now?

Molly Wood:

So a little bit more definition. The built environment, the world around us. Buildings are a massive contributor. What does embodied carbon mean within that context?

Anneli Tostar:

Yeah, so embodied carbon is the carbon emitted in the process of extracting the raw materials, transporting them to a manufacturing facility, actually producing the building materials and then getting those to the job site and ultimately installing them. You can track it all the way through to the end of life over, you know, a 60-year building use period.

But really a lot of what the industry is focused on and talking about right now is upfront embodied carbon, and that's what I just described of extraction through installation.

Molly Wood:

Right. And then honestly, is that the part that Tangible addresses, like the part where you are actually building a building is where you can, you can intervene with your solution and, and help to make this a lower carbon process.

Anneli Tostar:

Exactly, and the goal there is to help you understand what your carbon is, how that compares to where you could be, what you could do differently, and how to move forward and make changes in the future. So, um, you know, where the industry is at right now is really trying to measure things at scale. Um, you know, there are some leading firms that are building amazing mass timber buildings and really thinking about every product, every step of the way.

That's not the bulk of where the industry is at. And so the industry needs a solution where it can say, okay, here's where my performance is, and guess what? It's not tracking so well if I want to decarbonize my emissions by 2050, let's say, where a lot of developers have committed to decarbonizing. Um, so what we do is we help provide them with insights.

We help benchmark them. We help them understand what can be taken regardless of the phase of construction, importantly, because different actions can be taken at different stages. Um, and then ultimately the goal there is that this becomes, you know, a reflex in the development process for the developer. It's not, you know, this huge undertaking that has to be reframed every single time and, you know, requires huge buy-in. This is just part of their process.

Molly Wood Voice-Over:

Nicole told me this is still a relatively new phenomenon … this deep look into the carbon impact that is LITERALLY built … into buildings.

Nicole Granath:

This concept has been known for a while, but it really wasn't until, call it 2018, 2019, that people started talking in earnest about embodied carbon and the work that the Carbon Leadership Forum has done, um, out of the University of Washington and then other nonprofits that, um, have partnered with them, including Building Transparency and a number of the different initiatives that, like the MEP 2040 or some of the, the contractors' commitments. People have been working to say, okay, we know we need to address this. But that's been one piece of it, of the awareness. The second piece has been actually, now there are market forces behind this where investors are saying, Hey, if you want to raise your next fund from us, you're going to need to give us an answer to what your embodied carbon footprint is.

And then the third is that we're seeing increasing legislative pressure as well across North America. In Europe, it's already much further ahead, but really excitingly, California just said that embodied carbon reductions are going to be a required part of the CALGreen building code starting next July.

So it's here, it's coming. People are starting to not just have that awareness and also that pressure, but are going to start to face this in a real, um, you know, building code-related way as well.

Molly Wood: 

And so let's like keep digging into more specifics. We're really, you're talking about building materials, right? Like the point at which you're building it, like Tangible's solution is not about here's how to save energy. Once the thing is built, it's like, here's the stuff you put inside the walls, and then here's the walls and then here's the floors, you know, to Nicole's background.

Anneli Tostar:

Exactly.

Molly Wood:

Give us a little bit about, yeah, the specifics.

Anneli Tostar:

Absolutely. Well, I was just gonna say, you know, we, we really roll off the puns. Uh, and so, you know, the great thing about materials is that they're really tangible, right? Um, I think the fun fact, I had to, what can I say? The fun fact that we like to cite is, which is not so fun, is that the upfront construction associated, the carbon associated with the upfront construction of the building is equivalent to about 10 years or more of operating that building. So while the focus has been around operational carbon, which it needs to be, right, because typically buildings are around for 40, 50, 60 years. From a climate perspective, we have to start addressing embodied carbon now because those emissions are happening right now. Right? They're not phased out throughout the course of the building's lifecycle. They are happening right now at the point of manufacturing and, um, and production. So, that's why this is so urgent. You know, we have to generate this sense of urgency so that we start to really rapidly transition the types of materials that we are using in our buildings.

Nicole Granath:

What alternatives exist? Like we've talked a little on this podcast about that in the consumer realm, right? It's like you can, turns out you can buy a toothpaste pellet and a shampoo bar and that kind of thing. Is that what you're talking about is like swapping out a really carbon intensive, let's use flooring material since that's where you came from, for a better one.

Anneli Tostar:

Yes. And so, yeah, the answer is that the earlier you address embodied carbon, the broader your set of tools you have to work with. And so at that stage you can think about some of the decisions around massing, like what is this building even going to look like and what are the implied materials that we might need to use? What if we spread that out in a different way and then we don't actually need as much, you know, reinforced concrete and steel.

Molly Wood:

So that's one answer to the question. Can you actually address this and your product can address this at the planning stage? Like can you go all the way to land? Like how, how early in the reproductive cycle are we talking here?

Nicole Granath:

We're definitely right now most built out on the, let's take a look at the specific materials, because that's where folks have the, the most tangible impact. But it is very much a, um, like our goal is to be fully, um, across the lifecycle of embodied carbon planning. And that starts with the planning, and then you get to, okay.

We can take some of these massive leaps and maybe we build with hempcrete, or maybe we're looking at when Anneli first had the idea and created this fantastic Excel spreadsheet of sustainable materials, there was some of the, you know, kelp-based insulation or wall panels and the recycled, uh, glass tiles and, and those are the innovative products that we are really excited about being able to close the gap for them to get to market. And for some of the developers who are maybe curious about that, to have down the line avenues to actually validate that they work at scale. And then the last category is where there's probably the most applicability right now, which is, Hey, you have this insulation. Let's show you one that is 46% less carbon intensive, also available in your market. Not much of a cost premium and is going to be a really easy swap, just asking your rep. So that's where in the flooring world, what the reason why I even there it made sense for me to be hired to build out the sustainability department is because we were getting asked by our customers, Hey, we want to choose the more sustainable option.

First of all, what is your footprint? Secondly, can you give us one that's better than what we have right now? We would show them all of the certifications of like, yes, we can do this in this way. But that last piece is what, right now we have a lot of incredible functionality to, to recommend.

Molly Wood:

Amazing. Anneli, go back to the spreadsheet if you will. Like, it blew my mind the first time we talked to know that it, you know, you just sort of think that there's like a Google. For everything. Oh, I need a sus. I need sustainable building materials. I will just internet that.

Anneli Tostar:

Turns out, no. I think what was, what was remarkable to me was that. If we think about the way that humans operate, we're very simple creatures. We would love an answer that is black and white to everything. And folks who run sustainability programs are typically not black and white thinkers, right? They're very academically oriented, very in the detail in the data, which is really important because we want all of this to be backed up by data. And so the problem with that is that a lot of times it's hard to know, is this good or bad? Is this product sustainable or is it not? Am I on track or am I not? And you know, sometimes those judgment calls are a little bit arbitrary, but we need a solution for the industry that is going to drive action and get us to move in a directionally correct way. Right. Rather than sort of splitting hairs over, is this 4.3 or 4.4 kilos of CO2? Right. So when I started with back in, you know, I wanna say March, 2020, deep pandemic times.

Molly Wood:

I was gonna say other people took on sourdough. I, uh, honestly, it's incredible. It's pretty special. Well, sourdough starters are hell. Everybody discovered that and had to fail, so at least you built something to last.

Anneli Tostar:

True, true, um, And so this, the spreadsheet started out with 50 and then 200 materials, and it kind of grew. And um, and I think what just got me so jazzed about this space is there are solutions. There are solutions right now that not only reduce carbon, but actually store carbon. And that's the coolest thing about this space, is that if it's bio-based material that stores carbon over its lifecycle and is harvested sustainably, all of that it, there's actually carbon sequestered in the material itself. And so we have this opportunity to turn buildings into a climate solution. That's just a huge unlock for this industry, right? We can go from big emitters to big sequesters, and I don't think we're, we're talking enough about that.

Nicole Granath:

Exactly, and I think coming from the flooring industry and seeing how effective a lot of the existing channels are at getting, uh, product out, it underscores how difficult it is to penetrate that market as a newcomer, particularly as a newcomer that might not be in a category that fits very neatly in people's expectations.

So if we are to actually think about, you know, in the one to two year timeframe, it's probably a lot more of the swaps of the existing types of products in the 10-year timeframe. What does it look like in order to enable at scale the adoption of these innovative materials in a way that also satisfies what the structural engineers need to confirm about, you know, the integrity of the materials and the long-lasting nature of them and that to be really difficult to enable unless you have a whole set of folks who are committed to this gathered in one place and can then also share their findings with each other.

Molly Wood Voice-Over:

So long story short … Anneli started this spreadsheet during COVID … and was mentioning it to her friends and family … meeting startup founders in San Francisco and thinking hmm … maybe this … is that.

And she reconnected with Nicole … thinking they could combine their skills … Anneli’s knowledge of real estate and built environment and Nicole’s expertise in materials … and the two of them became co-founders … just like that.

Nicole Granath:

And thinking back to those little climate nerds who entered the first year of college, environmental science and public policy class, and, um, we're partnered on a group project together. I think we've, uh, commented on how grateful we feel that for us, that climate impact is always the North Star because so many other things fall away.

It's just where can you have that biggest impact and how do we educate and demystify for other folks to show them the opportunities that exist there as well.

Molly Wood Voice-Over:

Ok time for a break and then when we come back … these little climate nerds will tell us what they’ve built … and who’s using it.

Welcome back to Everybody in the Pool … I’m talking with Nicole Granath and Anneli Tostar about Tangible Materials … helping the people who build buildings … do it better.

Molly Wood:

Give us some specifics about the product that you have now created. Like, who is the customer and how do they interact with this product?

Nicole Granath:

So the customer is typically the sustainability manager at a real estate developer.

Molly Wood:

They might be, I'm just gonna keep digging down. Even for people who are just totally unfamiliar with this universe, they might be developing office buildings, apartment buildings, housing developments, like any, any and all of that.

Nicole Granath:

Anything. Yeah, so it could be multifamily apartment buildings, it could be, um, you know, data centers, warehouses. It could be senior living. It really can span just anything that requires a team to put a structure up or to refurbish an existing one.

So that, and then within those developers, you have a whole slew of different strategies, a whole different, you know, way of interacting with how they actually put that capital to work. But a number of them because of investor pressure, because of being publicly traded and, you know, uh, expecting that there's going to be disclosures coming from, requirements coming from the SEC, having internal folks who say, Hey, this matters to us, or their own stakeholders who are asking for the implementation of sustainability goals.

If you are a developer, embodied carbon tends to be your number one impact. So that is where as we are having the discussions with our initial customers, it's been really fascinating to see in the, oh gosh, now over a year and a half, um, I guess maybe 1.75 years since the official Tangible documents were signed.

Molly Wood:

Awesomely specific. Love it. Love it,

Nicole Granath:

The nerdiness does not ever go away. So, um, that it's, it's just been so wild where Anneli and I were like, I think that this is gonna be a thing. And even though folks were like, Hmm, that's neat. Like, come talk to us later. It's been maybe in these six-month increments, just seeing a sea change and the acceleration in those folks then coming back and saying, okay, we know that we need to address this. What do we do?

Molly Wood:

Okay, so that was my next question is embodied carbon is clearly their biggest impact, and that's measurable and known. Do they know it? Like does every one of these developers have a sustainability person whose job it is to try to address that? Or is that partly what you're saying about the, you know, this last six months where they're like, oh crap, we better get that.

Nicole Granath:

It is a massively mixed bag. So yeah, Anneli can speak to a lot of what we have been hearing and seeing in the education piece of it, but I'd say there's that beginning of the bell curve where it's the folks who are like, we know it's embodied carbon. We've set these goals, we're acting on it, and that is incredible. And they're leading the way. And then you have the, like, we know this is coming. How do we measure and take a look at this? And then you have the crew that really are like, can you give us the 101 on what this is? And, and then immediately what the action steps we need to take are.

Molly Wood:

Yeah, Anneli. How are you, how are you designing for those different buckets? Like, you know, I assume that they're the customer now is the person who already knows, but there's gonna be a big education piece as this market grows, and frankly, as you help pull this market toward you.

Anneli Tostar:

Yeah. Absolutely. Um, so I'll quote, uh, a friend of Tangible here in saying that, you know, there are three questions that real estate developers ask about technology. Who else is using it? Who else is using it? Who else is using it?

Molly Wood:

So accurate.

Anneli Tostar:

Not to bash on real estate, but there's a lot of herd mentality when it comes to adopting solutions. Um, it's the number one under invested sector from a tech perspective. Um, and so technology can move pretty slowly into these organizations and they like to see that things are kind of proven out by the leaders in the space. So our strategy is, you know, very much working with the folks that are on the forefront or, you know, at least are somewhat educated on embodied carbon, um, but have this sort of big sway in the market. And those tend to be one and the same. They're not always the same. Um, and, and then sort of set the expectation that, you know, the rest of the herd will follow.

Molly Wood:

So what is the very, very fancy version of the spreadsheet? Like how does that, it's a subscription service, you know, describe sort of what they're, I'm assuming. Hey, it does a lot more than the initial spreadsheet did and they are still the database. But the spreadsheet became a rocket ship. So like what's in the, what's in the rocket ship?

Anneli Tostar:

Yeah, totally. So, um, all powered by materials, data, you know, powered by data, uh, is the, is the important thing here. And, um, you know, we have close to a hundred product categories at this point, I think, um, over 70, at least I know. Um, and so really trying to cover the vast majority of the building. Um, and so accounting for impacts, um, across, you know, steel versus carpet, right? Depending on the scope of the project. Then we get into benchmarking, right? Is this good or is this bad? Is this on track or is this not? Um, so we use baselines that have been established by industry organizations.

Molly Wood:

For the overall building design or both? Okay. So you could pull up a little like compare this to this, to this.

Anneli Tostar:

For the products.

Molly Wood:

For the products. Okay.

Anneli Tostar:

Exactly. Yeah. And so then we have, you know, functionality at the project level. So helping you measure a specific building and say, you know, what's the total carbon? How does this track, what's your intensity? Those types of things. Um, and then importantly at a portfolio level. So what does this look like across not one building, but two, five, fifty buildings. Right? And for developers that have a really substantial development pipeline, that's the sticking point for them. That's the, that's the tough thing. And so, um, that's where we're super excited to provide a solution that can help at scale and also drive action at scale. Um, so then from there, that's where you start to see recommendations. That's where you start to see, you know, some of these opportunities for product swaps or different designs, if we're talking about earlier in the, in the lifecycle, um, or in the construction process. So it's, you know, it's an evolution, I would say, of where the industry has been towards, again, something that's very owner facing and something that scales.

Molly Wood:

Is that part the sticking point? Because they want to buy a product that they can implement across the portfolio, or because they need to track embodied carbon across the portfolio? Like what is that specific problem?

Anneli Tostar:

Yeah. So a lot of these firms have set net zero goals. Or even if they haven't set them they have investors who are requiring them to decarbonize in some form or another. Or they are operating in California, which has, you know, a lot of regulation on this, or they're operating in Canada and so. These firms need to not just have a number for each project. They need to understand what are my missions across development in total, right? And if that needs to get to zero, how do we do that? So that's where that aggregation becomes really key, right? Because then you can track it not just across projects, but across time.

Molly Wood:

So are you creating a plan? Is it, you know, like, is it a roadmap? A resource and a compliance tool, or some combination of all of those?

Anneli Tostar:

Yeah. So what we are hearing from customers is they want it all, and we are incredibly grateful that we talked at the beginning about how a lot of operational carbon, the carbon emitted to operate the building has that space in the last 10 years.

Did a lot of education in this market and I. So now we feel like we get to be the lucky ones. Riding the coattails of that, of folks are like, okay, we've seen this rodeo before. Like we know that you're gonna educate us on this, and then we're gonna have to measure, and then eventually we're gonna have to take action.

Why don't we just do all of that right now? Tell us what it is, let's measure it, and then show us immediately how we can, like, let's not wait until the next project. Let's make those swaps right now. And so there are those measurement components of it. And then there are also the long-term planning elements of, okay, if we are to actually think about this in a strategic way, how do we make decisions in this moment that are going to set us up for success for whatever, you know, five, 10 year goals we're setting.

Molly Wood Voice-Over:

Ok so as you can hear … a lot of this is new … it’s about growing awareness … it’s about being there when the market comes to you … but Nicole and Anneli told me that in addition to the change in the industry in the last four or five years in the US …

Europe … obviously … far ahead on these embodied carbon standards and so real estate owners … developers and asset managers … want buildings in the US to be built to the same standards as their European properties …

And apparently … Canada … is really moving on this. This past spring … Toronto became the first North American city to limit the amount of embodied carbon a new building can have … aka … they are requiring lower-carbon building materials.

It’s coming … changes big and small … all around us … even in the walls.

That’s it for this episode of Everybody in the Pool … thank you so much for listening …

Email me your thoughts and suggestions to in at everybody in the pool dot com and find all the latest episodes and more at everybody in the pool dot com, the website!

And if you want to become a subscriber and get an ad free version of the show, hit the link in the description in your podcast app of choice. Thank you to those of you who already have!

See you next week.