Building a Company That Leaves Enough Behind
We’ve begun a long journey here at ZeroMe, Inc. The development of the OffsetC app was step one. And now we’re past the starting line.
But Steven Covey keeps ringing in my head: Begin with the end in mind.
Our goal is to move individuals along on their journey to reducing their personal carbon emissions. It’s not just offsets, although that is a crucial first step. We are unlikely to see the ultimate goal achieved in our lifetimes: Return atmospheric carbon to pre-industrial levels.
So, how can we build an organization that keeps the goal alive for the next 100 years?
Christopher Marquis’ recent provocative op-ed in the New York Times got me thinking. I’m not in agreement with his general thesis that we should get rid of business schools. What stopped me was a different question: how much can we rely on good intentions when the structures around people reward something else?
In my career, I’ve been fortunate enough to learn from people much smarter than me about how company structure influences decisions. I’ve also seen the best intentions whittled away.
The key that I’ve seen is creating an organization where the goal remains central. And the right structures can help it remain so. This past summer’s 250th anniversary of the United States of America also gave me plenty of opportunity to revisit school lessons on the balances of power that the American Founders put into the Constitution. I’ve tried to bundle that and my professional experience to build a structure where incentives and governance make founding principles durable.
Building the Structure Around the Mission
Here are some early major decisions:
First, we are taking steps to create a separate entity to own the mission. This will likely involve creation of a Trust in the name of which all offsets will be retired. The Trust will also own the IP – software, brand, and records – that form the OffsetC platform. It will have its own board of trustees separate from ZeroMe, Inc.’s board of directors.
ZeroMe will remain a for-profit operating company. It will have an operating agreement with the Trust to build out the platform. The Trust will get an initial 10% equity stake in the operating company. Over time, the Trust’s share of the profits will be used for two purposes:
To reduce the cost for members via lower fees as we scale (think of how Vanguard Mutual Funds lowered costs as its scale increased rather than maximizing margin).
To buy shares of ZeroMe until it has majority control.
The Trust will be charged with protecting the mission. The operating company will run the business that generates the profits funding the Trust and allowing it to remain independent long after we founders are gone. We have already converted ZeroMe to a Delaware Public Benefit Corporation to ensure that implementation of the Trust’s mission can live alongside our fiduciary duties.
Who Benefits From the Value Created?
If the business succeeds, our founders' equity may become valuable. We have agreed to bound returns from our equity stakes so the Trust isn’t starved of the capital necessary to maintain this effort. We have chosen not to claim all of that potential upside.
As we seek out investors, we are looking for ones who share this vision. They should have the opportunity to earn a fair return for the risk they take. And we are asking them to accept a sufficient return, rather than an unlimited one.
We are looking ahead, too, to employees joining ZeroMe, Inc. Our plans include ways for them to participate in the value they create, without jeopardizing the mission that the Trust protects. Our current plan is for employees to hold a minority stake in ZeroMe alongside the Trust’s majority stake.
I grew up with a particular interpretation of the Christian Bible’s story of Jesus feeding 5,000 from five loaves and two fish. The miracle, in that telling, was not multiplication. It was example. Others had food, too, and when they saw Christ and his disciples sharing what they had, they shared as well.
You don’t have to share my faith—or that interpretation—to see the lesson I’ve carried from it: institutions endure when the people who benefit from them are also willing to leave something behind.
That is the principle we are trying to build into OffsetC.
Investors should earn a return for the risks they take. Founders should benefit from the value they create. Employees should participate in the value they help build. But if each of us tries to extract the maximum available to us, eventually there is too little left for the institution itself.
So we are choosing limits—not because value creation is something to apologize for, but because some of that value needs to remain with the mission.
If we get the structure right, OffsetC should not depend on the founders continuing to make the right decisions forever. It should have the resources, governance, and incentives to keep pursuing its purpose long after we are gone.
That, for me, is what it means to begin with the end in mind.
