Interview with Tom Chi: Can Business Be “At One” with Nature?

ImpactMoney Blog
18 min readDec 18, 2020
Tom Chi, Founder of At One Ventures (Photo: Mindvalley)

Since the industrial revolution, capitalism has lifted millions of people out of poverty, but with a major caveat. Prosperity has come at a cost to the environment. Humans have always sought to control nature, but control is an illusion if it destroys the planet that we depend on for survival. While my blog tends to focus on social entrepreneurs finding innovative ways to tackle the root causes of poverty, impact investing is also about business models that achieve a positive impact on the environment. So can business be “at one” with nature?

Ask Tom Chi. He is the founder of At One Ventures, which provides early stage investment to companies that disrupt the way we produce things not just to reduce the negative impact industrialization has on the planet, but to actually engineer a future where humanity can be a “net positive” to nature. At One Ventures invests in companies offering technological solutions to the problem of environmental sustainability. Tom views solutions as either 1) reducing the ecological footprint of industry going forward, or 2) rehabilitating the historic planetary damage of the past two centuries that has already been done. He also believes that in order to move the needle on environmental impact, technologies need to be commercially disruptive with a “no-brainer” customer value proposition.

I sat down with Tom to learn about his journey and his mission to radically disrupt environmentally-harmful industries by investing in technologies that will eventually make them obsolete.

What inspired you to create At One Ventures? Was there an “a-ha” moment that brought you down this path?

My partner was one of the first cohorts getting an MBA in sustainable management at the Presidio School of Management. I got to meet amazing folks like Hunter Lovins and David Shearer — so it was clear that it was possible to make a career in this area, but at the time I was an up-and-coming executive at Yahoo so it didn’t feel like the right time.

Then we got our place in Hawaii, which was a three minute walk to a really fantastic coral reef. It was one of the things I really enjoyed most about that place, you’d see every color of the rainbow and countless fish in all directions. But in 2011 I witnessed it go from being exquisite to being gray and brown and no fish. It had experienced a mass bleaching event, and it was really painful to see. My first thought was, what did we do wrong? I did some research and found out that not only did our reef suffer but close to 10% of all reefs on the whole planet did. Then I started speaking with coral scientists and found out that we have maybe about 35 years before the total extinction of shallow water corals on the planet.

That caused a shift in my timeline. I realized I needed to do something now. Not something toward the end of my career through philanthropy, I have to do this in the middle of my career. There was no time to waste.

However, the bleaching events are happening in remote Pacific islands as well due to the overall warming of the planet and thermal stress. This meant that to solve the coral reef problem, we actually need to solve effectively all of climate change. So I was thinking, okay, well, the problem is big, but now is the time to do it. That’s why I decided to go full force on this in the middle of my career rather than in just a lightweight way.

Is there one environmental problem that is of most concern to you right now, and if so what is it and why?

I think understanding scale is really critical, because there are many well-meaning folks that really don’t understand how big the problem is. A trillion tons of CO 2 is a very large number but gases are low density, so people say things like ‘gases have no mass’ right? So, the way I explain it to people is I tell them to compare their weight to that of a full-size car (a mass they are familiar with). Now imagine that mass if you gave every human on the planet a car. So, imagine a parking lot with 7.8 billion cars. That’s getting really massive right? Now take all of that mass, and turn it into CO 2 in the air. That’s what humans put into the atmosphere every year, and that’s not even close to the CO 2 debt from years past that we need to repay. You have to take that parking lot of yearly emissions and multiply it by about 80. That’s how much we need to remove. So when I hear a team tell me that they will make a product that captures some CO 2 into flower pots or uses CO 2 from the air to make some protein, it is way off the mark compared to how much mass needs to be pulled down.

I say that not to make people feel terrible. It’s actually because the rarest resource right now is capable, smart, caring people that want to dedicate their life to solving climate problems. Do you want them to spend 6 years of their life on a startup that might only affect 0.0001% of the problem? Of course not, that’s a misuse of rare talent. So we try to be friendly, but at the same time we’re very clear-eyed about the actual magnitude of the problem.

So it’s not the warming or the acidification of the oceans, or the eutrophication of water systems, etc. It’s really the scale of the problem.

Because people widely underestimate the scale, the basic template of many impact businesses is off the mark. The majority of them right now have got some sort of variation on the following pitch: if you’re willing to pay 50% more, I have this thing that’s 30% better for the environment — cue the yoga pants that that have 8 used water bottles inside of them. It costs more and maybe it’s a little better for the environment by redirecting some post-consumer waste. But we are not going to be able to solve the problems before us effectively if that’s the only type of impact business we are creating. The scale falls short, and when you ask people to pay more for something you basically are far more likely to end up as a niche brand.

We need to be clear-eyed about the totality of ways that industries are damaging the planet, and really prioritize deep re-invention or retirement of the biggest ones. For example, 90% of water pollution comes from agricultural and textile runoff. So, let’s focus on those industries. And everyone is focused on carbon emissions, but F-gases (fluorinated gasses), have a substantial footprint because of their intensified greenhouse warming potential, and their 10,000 to 50,000 year half-life in the atmosphere. We aren’t paying as much attention to F-gases even though they have an environmental footprint comparable to all the cars on the road.

Do you believe that human economic prosperity is not necessarily incompatible with environmental sustainability?

I would phrase it slightly differently, which is that economics is not a science we get to core truths on, but a design discipline that we implement through policy and we’ve done a really poor job in this design process. We came up with the obviously incorrect belief that the invisible hand was going to go and solve everybody’s problem. There may have been a short period in history where people could’ve believed that, but we now have a lot of contrary data. When you go design something like version 1.0 of a kitchen tool and it works for 80% of people but if 20% get injured by it, then a responsible designer would be like ‘holy crap let’s recall the product and fix it in version 2.0.’ We’ve seen the global economy create damage to more than 20% of the people and planet but we haven’t recalled it and asked: ‘how do we do the next iteration of this design?’ Economics is a design discipline and the people that have largely been in charge of designing it in the last 50 years have abdicated their moral responsibility to do it well. It’s time to do it well.

I feel like there’s a cost to production which is not being factored in, and nature has just been absorbing this cost because there is insufficient regulation to internalize it.

That’s a very widespread narrative and it’s mathematically correct, but there’s another lens that one could apply. In the narrative you just mentioned, it’s about accounting for externalities by valuing natural capital and ecosystem services correctly. I’m familiar with all this language, but it creates a dichotomy between the way business functions now and the kind of do-good way that it can function. But there’s an alternative frame and set of thinking. I would say that what we call externalities is basically us drawing the system boundaries incorrectly. In physics you have a system boundary, and you can draw them where you like. If you run a factory and you draw the boundaries to end at the walls of a factory, which is situated on a river, you might make decisions that optimize the factory, but damages the river. As soon as the system boundary includes the river, you’re going to make totally different decisions.

Do you have some specific examples of companies and technologies that you’re investing in and why you chose them? How are these likely to solve the environmental problems we’re facing?

So a lot of folks try to change things by asking, where is most of the bad stuff happening? How do you get big companies to go do things differently around all the bad stuff? This can set up a greenwashing situation or lead to behaviors that actually are less beneficial and way less innovative. So for example if you wanted to reduce plastic waste, then you’re going to love something like PepsiCo reducing the weight of their bottle caps by 11%. Because they are a big company, that 11% represents tons of waste avoided. It sounds huge from the impact perspective, but in practice, it has extremely little effect in the long term for the trajectory of plastic waste on the planet because no fundamental change has happened. They are still using a material that is incompatible with the health of many organisms, and all the positive press will increase their sales by 11% — suddenly there is no net improvement.

Given this, our theory of change diverges from this approach and is based on disruptive unit economics. Every industry is constructed around unit economics that define how materials, energy, capital and environment outcomes interplay. If you dive into the unit economics of industries like aluminum, steel, cement, and chemical separations, you’ll see how most industrial emissions are generated on the planet. In the same way, if you dive into the unit economics of agriculture and textiles you will see how most of the water pollution is generated. One could imagine this as a little unit economic machine at the core of each of these industries. What we try to do is find investments that so undercut the unit economics that it ruins the machines that ruin the planet. The companies we look to back take such a different approach, that if it starts to take hold you could not keep using the old unit economic machine because it would no longer be competitive in the marketplace.

So companies like Iron Ox, which do robotic hydroponic greenhouse automation, for example, are on a trajectory to being dramatically cheaper than the cheapest outdoor agricultural production that’s out there. Iron Ox would be replacing that model with something that uses no pesticides, no herbicides, no fungicides, uses 95% less water and 90% less nutrient inputs. The result is much less expensive, all the while keeping dangerous chemistry off our food and growing it in 30x less space, allowing us to leave more land intact for natural habitats. It’s not some marginal improvement that aims to be 11% better row-cropping while continuing most of the damaging practices. This is something of the Buckminster Fuller idea of not fighting a system, but make it obsolete by creating something much better instead. For our firm that means looking for things that are disruptively better economically, and much better environmentally. That is our theory of change. We understand and analyze the existing unit economic framework and then we find as many companies as we can that will effectively make it obsolete.

Regarding Iron Ox, I remember reading a National Geographic article about the Netherlands, and how they’ve become a global produce exporting powerhouse because they have really intensified agricultural production using greenhouses. It’s fascinating that a small country situated in a northern climate is able to export food all over the world.

The Netherlands is the second largest agricultural exporter in the world. Last year, it had $115 billion in net agricultural exports. It is tiny, and they use 27% of their tiny land area to do their agriculture. That is smaller than nearly every U.S. state, other than Rhode Island. So, in a space that small they are almost rivaling the U.S., which is the number one agricultural exporter in the world. Iron Ox takes that same approach to the next step. Imagine using robots to take those greenhouses to even lower cost and more effective production. That’s how you obsolete a damaging way of doing things like high-input, soil-degrading, mono-cropping — by completely breaking the unit economics.

For me it’s not about reducing the amount of plastic in a bottle cap by 11%, it would be producing a bottle from plant based plastics that is 100% biodegradable with no toxins. That would really have a huge impact but I don’t think PepsiCo is going to go in that direction.

That’s exactly what we’re looking for. The reason that we haven’t been able to go and displace plastics, is that the feedstock costs of plastics are essentially zero. They are just a residual of the oil and gas industry. So anything that is going to displace industrial scale petrochemical plastics needs to have both its feedstock and processing costs be lower than just the processing costs of plastics. In our firm we’re clear on exactly what those numbers are, so when we go and look at a new investment, we ask that question up front. We have evaluated 30 bets in this space deeply and maybe looked at around 100 in a lighter way, and we have found one that meets those criteria, which is called Cruz Foam. They make a polystyrene and polyurethane foam replacement, which is between 20 to 30% cheaper to produce because none of their processes require high process heat. Their feedstock is a food waste product (chitin), which they pay bulk prices for — effectively taking something that would be waste, making it useful, and stopping another thing that would be waste (Styrofoam) from being created.

In terms of unit economics, hasn’t a similar evolution taken place recently with renewable energy? It’s now cheaper than fossil fuel based energy.

Yes, the power generation stuff is exactly what caught my eye in the first place and is part of the origin of our unit economic theory of change. I sometimes quiz people: ‘which state in the United States generates the most renewable energy?’ The answer is Texas, by a lot, which surprises them. It is not a blue state with liberal laws or environmental regulations. It’s that Texas is an energy state, with a lot of people experienced in project finance and offtake agreements and all that is the bread and butter for providing energy to a grid. Historically, they did it through oil and gas, but the same people are well-suited to develop renewable energy. Once the unit economics are superior, it really doesn’t even matter if a Texas wind farm developer is a climate denier. They can be a climate denier all day while heading off climate disaster in their day job. This is why I think we are focused on the wrong things. People have gotten up in arms saying, ‘oh, how could these people be so stupid? Why don’t they pay attention to the IPCC reports?’ Telling people that they are ignorant is way less important than just winning at their game and obsoleting the damaging practices. It often takes less time to win the unit economic game than the political game.

I was wondering if you could talk about another company you have invested in called Treau?

Sure — 3 PhDs from MIT, Stanford, Berkeley got together in order to redesign air conditioning from scratch to help solve the refrigerant problem we talked about earlier. They invented an air conditioner that runs two times more efficiently than standard ones while having 6,000 times less greenhouse gas impact because it completely does away with fluorine based refrigerants. Once again, this is the template for all of our businesses: radically better unit economics and dramatically better environmental outcomes.

Do you consider yourselves to be impact investors? It sounds like you do, but that depends on your definition of impact investing.

I’d say we have a terminology and branding problem these days. Several generations of people have called themselves impact investors. What many of them really meant was something like ‘charity-plus.’ They gave away their money without expectations of a market rate return and said ‘hey, it doesn’t matter if your company really makes a profit, but could you eventually return the money so I can be more evergreen in my philanthropy?’

I don’t have any disdain for these models, but I think it has made it so that impact investing has been associated intrinsically with not generating market rate returns. That is actually the correct connotation given the sorts of businesses that have taken the spotlight so far. The business template that tries to appeal to conscience and asks you to pay more to get environmental benefit, typically doesn’t lead to systemic changes.

Many companies have used that template and many investors have been accustomed to returns that allow their money to last bit longer than straight philanthropy. So we don’t use the term impact investing because of the connotation. Having said that, every investment we do is absolutely about the future of the planet, but the investments are ones we believe will be market rate or better on the return side.

Maybe we need to coin another term. I think once we establish a pattern of being able to invest successfully then there will be another category that people can understand or we maybe can reclaim the impact investing term.

Would you say that the financial returns are as important, or even more important, than the environmental impacts for At One Ventures?

We need to achieve at least market rates of return. I think that we can because my historic IRR has been 36% net. In venture, if you have a fantastic fund, you promise folks 20%. But we are talking about investing in ventures that are radically disruptive with deep tech that change the unit economics of core industries. That’s how I’ve achieved that level of return.

I see a couple of scenarios. If we’re able to do anything like 30%, then we will have basically created a new sector, because that’s significantly better than what nearly all venture firms do. If we do 20%, then we will have put a stake in the ground that lets other venture firms know that it would be worthwhile to develop their practice in this area. It means you can generate market rate returns, using the venture format, but with a thesis that’s way better for the planet in the long run. If we do significantly worse than 20%, then it’s not necessarily ‘back to the drawing board,’ but it certainly won’t have the kind of catalytic effects we’re aiming for. People will say, ‘that was interesting, you had some wins and losses, but maybe you can do a little better next time.’ We are definitely aiming for those first two scenarios, but it doesn’t mean we are ravenous capitalists pushing for returns at all costs.

If we do this right, we can create a template for the next hundred firms after us to take this type of work seriously and raise the bar for this type of investing. This is why we’re an investment shop that is incredibly driven by business fundamentals. We don’t mess around with the ‘we-will-survive-by-raising-the-next-round’ game. We push for our businesses to be businesses sooner than most venture capital does. In our first 10 placements (which are on our website) seven of them have already logged revenue and three of them are already gross margin positive. That’s a very unusual level of progress for an early stage venture firm, most of which will take bets with revenue farther down the road and profitability not in sight for ages. We are not like that at all. We look at business fundamentals from day one, because if you are looking to change physical industries, there’s very little room for BS.

And so, how is your fund set up? Is it a limited life fund? Are you currently fundraising?

Yes, we have two and a half months to finish fundraising. It is 2/20 fund with a 10-year fund life. We made it a very classic construction on purpose. Our thesis is already radical enough, so to try to change the design of a fund or firm at the same time is just a little bit too much for LPs to absorb.

What is At One Venture’s long term ambition and how do you measure success?

We want to go and push the entire industry forward by setting a template that shows that you can invest in in a radically better future, and have it really work. We are actually working against some headwinds because there are people that remember the clean-tech 1.0 investment boom. They will tell me that the best venture folks in the world were working on it, and they couldn’t get it to work. So the bar to reset what folks believe in this area is really high. But let’s say we are able to do that, and we have a successful $100 million Fund 1 and then a successful $300 million Fund 2, we will still only be deploying a tiny fraction of the capital that is going into this type of work. So we like to share what we’re learning with the larger investment ecosystem to help ensure that this time around will be far more successful than clean-tech 1.0. So, unlike some firms that worry that they will lose their secret sauce by sharing, we want to make sure that as much capital is going into this sector in as smart a way as possible even if it’s not through our fund.

Would you say that you’re generally optimistic about the future of mankind and our ability to correct course, or do you think things are likely to get worse before they get better?

I think the answer is yes to both. Things are definitely going to be a lot worse before they get better. There are trajectories that are already built in where just the physics of that mass of CO 2 being in the atmosphere will drive climate destabilization and the full damage of that has not been experienced yet. Even if we could wave a magic wand right now and have zero emissions for the whole planet, we would just continue to warm for another 300 to 400 years just from the CO 2 that’s already up in the atmosphere. We clearly need to be ramping off of net emissions globally and drawing down 1 trillion plus tons of CO 2 thereby repairing and restoring a couple centuries of damage. That’s why my answer is yes to the first thing.

For the second thing, there is no reason from an economics or physics perspective where we could not end up in a totally different spot than where we are today. That’s exactly what our firm is trying to demonstrate. It is true of every one of our investments. Just in the same way that Dutch greenhouses have proven that a tiny land area can add up to the second largest agricultural exporter in the world, Iron Ox is going to prove something even further. How healthy can you make that food and how consistently can you produce it? How low is the lower bound for the cost of a fully stable and nutritious food supply? We want to do that, not just in one industry like in Iron Ox, or Cruz Foam, but in all the sectors of the economy that are currently creating our damaging relationship to nature. This is actually just about better business. That is why I’m optimistic. I already get to experience this future. I’ve had Iron Ox produce and felt the air conditioning of a Treau air conditioner.

I try to be optimistic as well. I can see it a tipping point in the future where people just dump their combustion engine cars and switch to electric for the same reason they switched from box TVs to flat screens. There was just this tipping point where everyone just switched. I’m optimistic that that will happen.

Tesla is a great example. It will make the internal combustion engine car obsolete. If you have experienced an electric car and use it for a while you realize, oh, I have not been to a gas station for a year and I don’t miss it at all. I don’t miss repairing those hundreds of moving parts. We won’t miss all these things. The oil companies are saying, ‘You’re going to miss us when we’re gone.’ And it’s like, no, we won’t. We won’t miss them any more than we miss the whaling industry of the early 20 thcentury.

So people just need to have enough of those experiences. They reset our expectations and allow us to ask for more of the world we want. Tesla’s example has spurred BMW and Toyota and Nissan and others to get actually serious about producing EVs. All of them are putting compelling offerings out in the world. That’s an example of obsoleting the old way of doing things. At One Ventures is basically that seed multiplied across every industry.

[ Editor’s note: the above interview is a redacted version of the original, which was shortened for publishing. If you would like a transcript of the full interview, please subscribe to the blog and send a request via the contact page].

Tom Chi was a founding member of Google X and has given many interesting talks such as this one, where you can learn more about his life and work.

Originally published at on December 18, 2020.



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Anthony Randazzo, CFA — 15+ years in Impact Investing, sharing insights on social entrepreneurship and impact investing at