Meet Harvest Intelligence, a plucky (fictional) Series B startup founded by Ava and Zack. Their mission? To empower farmers to maximize productivity using data-driven solutions. Harvest Intelligence recently decided to become net zero by 2030. We’re joining Ava and Zack on their climate action journey and demystifying some key terms along the way.
The Net Zero Quest
It’s January 2025, and Harvest Intelligence has just announced its ambitious goal: achieving net zero emissions by 2030. But what does that actually mean? “Net zero is about drastically cutting our carbon footprint,” Ava explains. “We’re aiming to reduce our emissions as close to zero as possible. Any remaining emissions that we can’t eliminate, we’ll offset. That’s basically cancelling them out by paying for activities that would remove the same amount of carbon dioxide from the planet.”
Carbon Neutral: The Stepping Stone
While working towards net zero, Harvest Intelligence decides to go carbon neutral in 2025. “Think of it as a climate action participation trophy,” Zack quips. “We’re offsetting all our current emissions that are within our control, but we haven’t reduced them as much as we can yet or really considered the emissions in the entire supply chain.”
Carbon neutral is a good starting point, but Ava and Zack know that to maintain customer trust they need to make good on getting Harvest Intelligence to net zero and find ways to reduce their emissions as well.
Scoping Out Emissions
Harvest Intelligence’s journey begins with understanding their emissions. In order to be able to reduce or offset their emissions, they need to know what and how much they are. The key is having a common unit of measurement that different emissions can be compared to so they’re making apples to apples comparisons.
Enter CO2e or carbon dioxide equivalent, which is a common currency when discussing emissions. CO2e allows Zack and Ava to compare the impact of different greenhouse gas emissions that their business activity produces by converting them to the equivalent amount of carbon dioxide.
As Ava and Zack worked to figure out what their CO2e emissions were, they realised that emissions come in three flavours, or scopes, and they had to reduce or offset all three to be considered Net Zero:
- Scope 1: Direct emissions from their operations, including any industrial processes and energy generated or consumed on-site, for example, the office HVAC system.
- Scope 2: Indirect emissions come from energy that is created off-site but used on-site. It is mostly electricity from utility companies.
- Scope 3: Indirect emissions that come from a company’s value chain. For example, cloud computing usage, business travel, employee commutes or lifecycle emissions for the company’s laptops.
The team was shocked to discover that Scope 3 emissions, which they had little direct control over, made up the bulk of their carbon footprint. “Scope 3 is the real doozy,” Ava sighs. “It’s like trying to count all the grains of sand on a beach.” It was a sobering realization that true climate action would require some systems change.
Navigating Carbon Markets
As Harvest Intelligence worked on reducing emissions, they also explored the world of carbon markets. The voluntary carbon market, where companies could buy or sell carbon credits by the ton, seemed like a good place to start. These credits represent activities that remove or avoid greenhouse gas emissions and were bought by companies that wanted to offset their greenhouse gas generating activities. The market is voluntary because companies choose to participate on an optional basis, not legal requirement.
But lurking on the horizon was the specter of compliance carbon markets. As governments tightened regulations, Harvest Intelligence wanted to understand if they might soon be legally required to participate in the carbon market through a cap and trade program. Thankfully, Harvest Intelligence wasn’t a big emitter or in a regulated industry and so Ava and Zack don’t have to worry about compliance markets for now.
Offsetting vs. Insetting: A Tale of Two Strategies
Harvest Intelligence had set net zero targets and wanted to explore more ways to reduce their carbon footprint. They had been buying carbon credits from tree-planting companies—a classic offset strategy involving credits from unrelated businesses.
But Ava and Zack wanted a more impactful approach. Insets offered a more direct solution by reducing emissions within their own value chain.
Think of carbon offsets like donating to a community garden in another city. It’s helpful, but you don’t directly improve your own backyard. Carbon insets, however, are like planting trees and improving the soil in your own garden. You’re directly addressing environmental impact where you have the most influence.
The team realized insetting presented a more meaningful opportunity for change. They decided to develop a new product feature for data-driven cover crop placement, which would enhance soil carbon sequestration and improve the overall carbon balance in their customers’ farms.
As Harvest Intelligence continues their climate action journey, they’ve learned that sustainability isn’t just a buzzword—it’s a strategic imperative. Climate-conscious strategies attract customers, talent and investors.
For startups looking to follow Harvest Intelligence’s path, the roadmap is clear: measure emissions comprehensively, prioritize reduction over offsetting, and view climate action as a competitive advantage. In today’s market, your climate action story isn’t just about saving the planet—it’s about building a more resilient, innovative, and attractive business. So what’s your company’s climate action story?