There are many carbon accounting and emissions management platforms available today. However, startups tracking emissions problems tend to tackle the easiest ones first: direct greenhouse gas emissions from sources owned by a company. In climate industry jargon, these emissions are called “Scope 1.” “Scope 2” emissions are all GHG emissions from the energy a company uses. Today, when you add up Scope 1 and 2 emissions, they only account for about 25% of total global emissions. The rest is Scope 3 emissions, which are hidden in supply chains and very difficult to track.
Startups are starting to tackle supply chain emissions. For example, Clearly recently raised $4.3 million to tackle supply chain emissions related to transportation.
Another example is how the 113 million tonnes of CO2 emissions produced by Nestlé are equivalent to the entire GHG emissions of Belgium: more than 107 million are emitted along the entire supply chain.
Another “vertical” player is now attracting investors. This time, it’s a startup looking to decarbonize supply chains in agriculture.
Root helps agribusinesses collect primary data about their agricultural supply chains. The RootOS platform was launched in October 2023 by co-founders Eric Oancea and Maurice Hensl, and now counts customers including dairy plants and fast-food chains, though the company declined to name its customers so far. It works with more than 10,000 farmers to date.
Root has now raised €8 million in seed capital, led by Point Nine’s Christoph Janz, with participation from Project A, HelloWorld, Arc Investors and other startup operators such as P9 alumnus Robin Dechant and Cargo.one CTO Mike Rötgers.
Root explains that food and beverage companies’ sustainability and procurement teams use its platform to collect verifiable primary data from farmers that simply answer a few simple questions. The rest of the data needed to calculate GHG emissions is then pulled from existing documents and other data sources.
Root then models the environmental footprint of each product, allowing companies to see “emissions hotspots” in their supply chains.
According to Oancea, emissions tracking companies like Watershed, Sweep and Normative have too “one-size-fits-all” an approach. “These companies use secondary data and industry benchmarks to calculate that on average, a piece of aluminum has a carbon footprint of 5 kilograms of CO2,” Oancea said. “Or that a liter of milk has a carbon footprint of 2 kilograms of CO2. But in reality, these numbers are incredibly different.”
He says the food industry needs to move away from generic software solutions or climate consultancies that use market benchmarks “to a system or process where you, as a company, actually start collecting data on your supply chain activities.”
Of course, this requires being very precise. The hundreds of thousands of farmers who might, say, supply McDonald’s emit CO2 depending on a bewildering number of variables such as the number of cows they own, their feed, the fertilizers they use, and so on.
According to Oancea, these variables “will lead to huge differences in greenhouse gas emissions between suppliers and so until we get there and collect data from these suppliers, it will be impossible to make better decisions to reduce carbon.”
Root’s platform is used by sustainability managers and purchasing managers at large agribusinesses, he says, who use it to interact with their suppliers, such as farmers. It can connect to a farm management information system and pull in the relevant data. “We feed that into our carbon calculator, and through that, each supplier gets a personalized score that represents the reality of their operation.”
Root is currently only available in the German-speaking DACH market and some Eastern European countries, but plans to expand across Europe this year.
