The Business Leadership Podcast

Salli: [00:00:00] You're listening to the business leadership podcast with Edwin Frondoso.

Winston Morton: Every single building has a positive return on investment for a retrofit. So if you think about it, if every building can benefit from a retrofit and that puts money back in your pocket, it's an investment. Why isn't every building getting upgraded?

Our vision would be not only reduce carbon, but potentially make buildings carbon positive. In other words, we can turn buildings into carbon sinks, they can provide renewables, they can get past zero.

Edwin: Good morning. Good afternoon. And good evening biz leader.

Welcome. To yet another episode of the business leadership podcast arm, of course, your host, Edwin Frondozo and today. We are featuring. A special episode from our future narrator mini series. Which was recorded live at the [00:01:00] collision conference in Toronto, Canada. Within this series, we explore the future of leadership. Innovation and storytelling. With visionary leaders who are not just designing products. But our creating entire new worlds. And markets.

Joining me today is Dr. Paul Newton and together. We are speaking with Winston Martin. He is the CEO and co-founder of Climative A company dedicated to simplifying home energy retrofits through the use of AI.

In Our conversation, winston we'll discuss Climative mission to make low carbon plans accessible to homeowners by digitizing the assessment process and providing ~early. ~Personalized recommendations. We'll also explore the challenge of working with government regulators. The importance of purpose-driven work. And Climative's long-term vision of creating carbon positive buildings.

Winston highlights the necessity of collaboration, [00:02:00] patients, and a data-driven approach to transform the energy efficiency sector.

So without further ado, here we go.

Now we're speaking with Winston Morton from Climative. How are you doing today?

I'm doing great. Thanks for having me.

~Yeah. ~Amazing. I'm super excited to have you on the Business Leadership Podcast. I guess first off, Winston, can you provide or share what the problem that Climative is doing or solving in the sustainability field?

Winston Morton: Yeah, so climative produces low carbon plans for residential buildings.

That sounds technical, but what it really means is we provide homeowners a very easy way to understand what they can do to upgrade their homes for both energy savings, cost savings, and obviously carbon savings to save the planet.

Edwin: Yeah, and that's for all of those who are out there who are homeowners, that's a very, I would assume, a very confusing area. So how does that help them?

Winston Morton: Today, most homeowners have to be go through a fairly [00:03:00] rigorous onerous process to do retrofits or figure out what retrofits to do in their home. What our goal would be is our platform uses artificial intelligence to pre assess an entire city or an entire province or state.

And we start that conversation much, much earlier in the process. So we provide a digital assessment of a home, we provide a homeowner portal where they can get on their portal, claim their home. And get a lot more ideas much earlier. In today's world. You really don't know what to do until you get a home energy assessment, which costs five or 600.

You wait a few weeks. And the sad part of that is only about 50 percent of those energy assessments turn into a project,

Edwin: which is crazy. It just came to mind. ~What's in it. And it's, there's a lot of, ~I'm assuming in your industry, there's a lot of sticker shock. When they get that, and that's why maybe it's not converting and they're not getting educated ahead of time where I'm assuming this is where your platform.

Winston Morton: It's sticker shock, but interestingly enough, every single building has a positive return on investment for [00:04:00] a retrofit. So if you think about it, if every building can benefit from a retrofit and that puts money back in your pocket, it's an investment. Why isn't every building getting upgraded? And most of that, there's two reasons they don't get upgraded.

Number one, knowledge. And number two, capital, right? So the knowledge is, needs to be pushed out to the customer in a more personalized, digitized way. This industry is probably one of the last bastions of industries that hasn't been digitized. If you think about almost every other part of our lives, you go travel somewhere, you get on your app, if just about everything. Banking's been digitized, but the energy efficiency sector has not been digitized. Yeah.

Edwin: That's great. Can you tell, can you share how AI, artificial intelligence is helping you like revolutionize this segment?

Winston Morton: Yeah data is king. ~And so ~we take existing assessments across the country.

~So ~we've done about 1. 2 million on site assessments ~across the country. ~We work with government agencies that provide us ~that ~data for training. We train machine learning models, AI [00:05:00] tools. We've been doing this for years. ~This isn't, ~for us, AI is not a new thing. ~It's not a, ~it's not a buzzword. We've been doing it for a long time.

~And ~almost to the point we don't talk as much about AI anymore because it's a bit of a buzzword, right? ~So what we do is ~we take that data, ~we ~train machine learning models to predict the benefits to the rest of the 12 million buildings in the country. And that runs very fast. It's very cost effective.

And really what it means to do is start the conversation with the homeowner.

Edwin: And when you start the conversation, are you seeing a lot of feedback, conversations that are them reaching out to you and the platform?

Winston Morton: It's mostly done through partnerships. So we work with cities, utilities, provinces to be the stakeholder in that conversation.

So often ~what ~we'll ~do is ~launch in conjunction with a city or a utility or a government. Because what they're trying to do is target more personalized programs, more effective programs. So a good example is the federal government's transitioning kind of from mainstream programs into low income programs.

~Where you really have to, back to this capital challenge. So ~these low [00:06:00] income programs are ~fairly ~difficult when you have a hard time paying your power bill or buying groceries. You're not thinking about capital upgrades. So what the federal government is doing is transitioning a lot of these programs into much more upfront incentives ~to some point, ~even paying 100 percent of the retrofit.

The challenge is the homeowner doesn't know how much money they're going to save to even get started, right? ~So ~we can ~do things like ~add demographics data to our energy data and ~we can ~help cities and provinces focus on ~the ~low income neighborhoods or ~the ~renter versus owner neighborhoods. ~So ~it's all about building better engaging tools.

Edwin: Yeah, and these tools, from what I'm hearing it's really empowering and enabling these bigger organizations, maybe very slow organizations, to push through this technology. How are you finding the cities and these utility companies shifts with this enablement?

Winston Morton: ~Yeah start by saying, ~ Starting a startup that sells to utilities and government is not for the faint of heart, ~right? ~Regulation takes time. When we're in a regulated environment like a utility, they're very focused [00:07:00] on incremental change, not transformational change. We go to the market and say we've got to improve by a hundred or two or three hundred percent to hit our climate targets. We're only retrofitting somewhere between one and two percent of our building stock a year. That needs to be about 4 percent to hit our climate targets. So we've got to transition the whole industry to be three or four hundred times more effective.

Edwin: Wow.

Winston Morton: So that's a lot of change. And utilities are not known for change. And cities, there are cities that tend to be more progressive and leaders.

Edwin: Sure.

Winston Morton: So we'll have, some cities in the country that have, the Vancouver's, the Ottawa's, the Halifax's are all fairly progressive cities. We've got a number of cities.

In that category, but they tend to be early adopters. We've got another 3000 municipalities that are followers. From a startup perspective, ~using the startup terminology, ~we're in that early adopter phase, right? ~And ~then you go through the valley of death and then you get the majority.

So hopefully we can cross the valley of death by focusing on the benefits to these early adopters. The [00:08:00] benefit that we have is the regulations are lining up. Utilities are. Doing unnatural things. They're doing things that are uncomfortable. We've got regulatory environments ~that are ~pushing electrification and new transformation.

We've got building codes that are getting adopted ~takes time, ~but that changes behavior. We've got the banking system. People don't realize in Canada, our banking system now has to report carbon and finance carbon. Every single mortgage in our country ~actually ~will get scored for carbon. It's very difficult to do manually.

So we've got a lot of these pressures. All pushing down to that common goal, right? The homeowner needs to make decisions. ~I would say ~it's not one island anymore that we're chasing. It's a whole bunch of stakeholders ~that are ~working in that market.

Edwin: Yeah, 100%. Aside from, this enablement, the use of AI, what other major disruptions are you seeing? Or, if you're seeing any within the, within your industry?

Winston Morton: Yeah. So really, when we think about AI, there's really two core tenants in AI. One would be statistical [00:09:00] models or machine learning models that have been around for a long time. Yeah. 30, 40 years. So we use both methods of AI. We also have large language models and that back to starting 120 million conversations.

Those large language models have the potential to give very cost effective and accurate advice very early in the process. But in our world, you still need to talk to a human at some point. So we usually define that as AI assisted. In other words, get the conversation started with a digital experience, personalized experience, maybe include some large language model conversational tools.

But at the end of the day, you do want to talk to somebody for some advice. And so our platform supports everything from a remote person, having a video conference with a homeowner even the physical on site audit still required in some cases, right? Maybe the homeowner has a very odd home that needs to be physically audited or they're not comfortable with technology.

But by and large, you can do the digital thing to really speed [00:10:00] up most of the market. So that's transformational. And talking about these machine learning or AI tools, we're talking to governments and regulators and the federal government, it takes a long time for them to be comfortable. So we spend a lot of time.

In market, doing assessments, checking our work, working with partners. So it takes quite a long time to build up that. I would say it's a trust, right? And a confidence factor, right? So that's what we're doing now is we're out working with those early customers. We're developing trust in the platform. We're working with the early adopters and we're hoping that majority comes along.

Edwin: Yeah. What's interesting and what's coming to mind as you talk about. Working with governments, ~working with ~utilities and really looking to communicate . How to do these 10 X transformations? How to really retrofit the industry? I'm wondering as a business leader, as a startup founder, ~like ~how do you lead your organization and also your partners and ~the ~stakeholders through ~throughout ~this [00:11:00] change?

Winston Morton: Yeah. We, you got to Pick your brand promise early as a startup. And from our point of view this concept of trust and, the ability to have a purpose for the company has a really big impact, both with our employees and our partners. It's a competitive market out there.

When we go to hire engineers ~to work on this, ~we're competing, especially on the big data and the analytics. ~And we're doing all the sexy stuff. ~We're competing with the really big players out there. We can't pay what Google or Amazon may pay. But we have purpose and we have impact. So when those engineers wake up in the morning, they're working on our platform.

They see a direct line from their work to a ~pretty ~big impact in the world. So I would say purpose is number one. Get it figured out, particularly in the clean tech sector. And the sustainability sector. And then that ~kind of ~gravitates to the partnerships. Google. You've got to align your purpose with your partners.

~I will say ~sometimes we make our partners uncomfortable because we push the envelope a little bit. ~Yeah. ~But that's not a bad thing. You have to [00:12:00] find those early customers and those early partners that'll push the envelope, take a little bit of risk, but we've got to take some risks.

Edwin: I guess you mentioned aligning with your brand promise and starting with purpose. Do you or your organization have a specific brand message right now?

Winston Morton: Yeah. ~So ~we're a very collaborative company, so we go out of our way to collaborate with our customers, with our partners, and quite often with our competitors.

Yeah, because to be perfectly frank, a digital evolution for retrofit market. A floating tide rises all boats. . So we got a lot of work to do. We're going from one to 2 percent a year. We've got 97 percent of the market to start having that conversation. It's going to take a village.

~And so ~we ~tend to ~sit on standards boards and committees, and we try to encourage that adoption right across the board. So I would say if you've called our partners, I think that would be the first answers, we're there to help move the market. It's a little extra work, but it really does help our brand.

Edwin: [00:13:00] Yeah. And it puts you, I would assume when you, Come as a collaborative approach with the brands it really puts you as a leader ~as well ~and a visionary when it comes to these folks.

Winston Morton: Yeah, and you have to have the fortitude to stick with it ~Yeah ~you know ~you got a ~you got to pay the bills and make payroll at the same time You're leading some of these long term.

Edwin: Hundred percentions what does just thinking future what does a future of low carbon living look like?

Winston Morton: A lot the same as today.

So what I mean by that is, it should be very un disruptive. In other words working and living tomorrow with a low carbon future, if we do our work properly, it's in the background. You're gonna, you're gonna even maybe be a little more comfortable But that's some of the, particularly retrofits, they last a long time.

Edwin: Yeah.

Winston Morton: So you do these projects and in the background you're putting solar on your roof, you're insulating your home, you're electrifying your home. Once it's done and you don't have to think about it anymore, right? That's the difference between a behavioral program where [00:14:00] you have to flick a switch every day or turn a new thermostat.

We're working on really big projects that have long term savings. So I would say it's mostly about making decisions for the future.

Edwin: Aside from, I hear a lot of challenges, but there's a lot of perseverance within your industry, within being a startup, within that industry. Are there other challenges, or maybe some big challenges, maybe it's not something you haven't mentioned yet, that you're facing as you're putting this out there?

Winston Morton: So for us the momentum of the current market, It's very difficult to move. We're talking about billions of dollars of programs and very old established regulations. So it's hard to move those things fast enough, right? So we're on the edge, showing the art of the possible.

And then it takes quite a long time to move that into, particularly on the government regulation side, to get it moved into mainstream. And the government, that's even when they're willing, right? That's when they're excited. Yeah, so progressive government, [00:15:00] even progressive government. So we tend to pick our battles, work on moving them, moving the ball as we can.

And sooner or later that boulder will start to move in the right direction. So yeah, it's mostly inertia of the existing market that we're trying to change.

Edwin: And maybe I asked this, or maybe it's a rephrase of what I'm asking. How are you, like, how do you plan for the future to address this? Or is it, Hoping that inertia will get rolling and you're ready to roll with it.

Winston Morton: I think for us, providing data provides a whole new business model. So we're hoping that others recognize that there's a lot of collaborative opportunities powered by this data. So a good example is, believe it or not, municipalities don't often work with utilities. Or utilities don't often work with banks.

Edwin: It's all siloed.

Winston Morton: It's all siloed. And what we're hoping is the collective good. The, all the stakeholders in this market realize that there's real business models out here. There's a trillion dollars to deploy in North America to meet our [00:16:00] carbon targets. So that should attract some commercial interest, right?

Some players. Yeah, some players. So I think providing data platforms. In a way that has already been transformed in many of our other markets. Banking is a really good example. It's been fairly digitized. So the bank, once the data is available, I think we're going to find that private capital and private projects come into the market because it's a provable business opportunity.

Edwin: ~No, amazing. ~ I appreciate that. So we're working on this future narrative project and really thinking about the vision. So question I have for you is what is your vision of the future that you're building?

Winston Morton: Yeah, so I think our vision would be not only reduce carbon, but potentially make buildings carbon positive.

In other words, we can turn buildings into carbon sinks, they can provide renewables, they can get past zero. And we could be in a situation because buildings today represent about 20 percent of our emissions, [00:17:00] not insignificant, but moving these places where people work and live to carbon positive means that we can actually be a carbon sink.

It's a really great way there. It's an easy place to invest people. It's very visible place to invest. So we would think that buildings are actually a really investable way to start moving to a carbon positive future.

Edwin: And I guess just for my purposes, a carbon positive building in my eyes and in my imagination, it's like a plant now.

Winston Morton: It's exactly it.

Edwin: It's helping the world rejuvenate. It interacts.

Winston Morton: It interacts with the electricity grid. It creates energy. It's an energy storage device. It balances out our energy grid. That's really what we could be doing here is we begin using these buildings as a way to power a low carbon future.

Edwin: That's amazing. I love that feature. All right, last question on that is ~and it's back because it's the business leadership podcast. Like, ~how do you lead and inspire to get the buildings to positive?

Winston Morton: I think the path has to be a [00:18:00] lot easier. When we look at the problem we're solving, ultimately it's that homeowner or the home renter that's going to drive the change.

And in today's world, that homeowner is their attention and their, Capital and their thoughts about how they're living at home. There's a lot of people competing for that time. ~And ~we've got to make it ~much, ~much easier for homeowners to realize that ~they can be part of this journey and ~they can be part of this journey ~and ~be more comfortable, save money and save the planet at the same time.

~Yeah. ~

Edwin: I imagine just getting that last point that you said is yeah, you can make a difference.

Winston Morton: You can make a difference. ~Yeah. ~

Edwin: And I guess being a homeowner, ~it's ~sometimes they don't. I think everyone's selling them something and now you're going to retrofit this. It's going to cost me a thousand dollars, whatever the cost is.

Winston Morton: So there's gotta be benefit.

Edwin: And the benefit is at the end of the day, like you said, the carbon positive, the future and living somewhere that's helping the world ~and not, ~and helping yourself.

Winston Morton: Right.

Edwin: Winston, any final thoughts or advice for, the business leaders, the founders, [00:19:00] the executives that are listening.

Winston Morton: Yeah. So I think particularly in climate tech or property tech, it is a longer journey than normal. This isn't a piece of software that you publish and you've get, a million downloads and overnight you're an overnight success. This is a, this is an ecosystem that's moving, maybe not as fast as a startup community expects.

~So ~you've got to have some fortitude. ~You've got to have ~patient investors and partners. ~And ~it's a long term goal, ~right? So I think that would be one of the, ~if you go into this market as a startup, ~particularly, ~you've got to realize that ~there's gonna, ~it's gonna take time, ~right? ~

Edwin: That's amazing. Thank you for joining us, Winston.

Winston Morton: Thank you very much for having me.

Edwin: That's it biz leaders. Thanks for joining me on another special episode of the business leadership podcast. This is part of the future narrative mini series, which is recorded live at the collision conference. This was a very enlightening conversation with Winston Morton, exploring Climatives, innovative approach to simplifying home energy retrofits. [00:20:00] And their vision. For a carbon positive future.

For links to all the resources we discussed to connect with Winston and to learn more about the future narrative project. Please check the show notes in the app. You're listening to. Now, if you are interested in reading more about Winston and all the other business leaders, we profiled that collision. Please join the waitlist of our upcoming book.

And by the way, if you found any value. Listening to this episode, please do subscribe rate and share it with the first person that comes to mind that could benefit. And who would also be Uber grateful from hearing from you? Your support helps us grow and bring you more great content.

Thanks again for tuning in. And being part of our community until next time have a 100 X day [00:21:00]