Jan 28, 2020 · 46m · y-combinator
Diego Saez Gil - How Pachama Uses Tech to Solve Climate Change · Y Combinator
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In this Y Combinator podcast episode, host and partner Gustav Alströmer interviews Diego Saez-Gil, co-founder and CEO of Pachama, about using artificial intelligence, satellite imagery, and remote sensing to verify forest carbon capture. They discuss Diego's entrepreneurial journey, the mechanics of modern carbon markets, Pachama's machine learning technology, and advice for tech talent entering climate tech.
How this conversation actually went
Every chapter scored 0–10 on four independent dynamics. Hover any point for the reasoning behind the score. How this is scored →
The partners as informed peer 2.7 Guest teaching 4.5 Guest disagreement 0.0 The partners pushing back 0.7
speaking balance: gold is the partners, purple is the guest (3 minute bins)
Sharpest disagreement ▶ 37:02 Mission-first boundary setting with investors
Diego emphasizes setting rigid boundaries with VCs, requiring them to accept that ecological mission precedes corporate profits before taking their checks.
Hardest push from the partners ▶ 26:58 Host pushes on remote sensing limitations for biodiversityThe host presses Diego on how altitude and canopy shapes alone can genuinely differentiate tree species and assess ecological biodiversity without ground audits.
Biggest teaching moment ▶ 15:45 Carbon drawdown potential across one billion hectaresDiego delivers a rigorous quantitative breakdown of global reforestation math, detailing how a trillion trees across one billion non-agricultural hectares capture 200 gigatons of carbon.
The partners hold their own ▶ 15:15 Gustav contextualizes gigaton-scale venture thresholdsGustav establishes domain benchmarks citing Breakthrough Energy Ventures criteria, demanding to know if forest-based solutions can meet multi-gigaton annual thresholds.
the scores for every segment, with the reasoning behind each
| Chapter | Topic | The partners as informed peer | Guest teaching | Guest disagreement | The partners pushing back | Why |
|---|---|---|---|---|---|---|
| Diego Saez-Gil's Entrepreneurial Journey and Path to Pachama | 3 | 2 | 0 | 0 | Gustav sets up Diego's founder backstory and connection to YC's Carbon Removal Request for Startups. Diego walks through his background from Argentina to founding smart luggage company Bluesmart and eventually conceiving Pachama after experiencing the Amazon rainforest. | |
| Understanding Carbon Markets and Existing Reforestation Inefficiencies | 2 | 6 | 0 | 1 | Diego educates the hosts on the mechanics of carbon markets and explains why less than two percent of funding reaches forest projects due to slow, manual audits and verification fraud risks. | |
| Pachama's Technological Verification and Direct Marketplace Model | 2 | 5 | 0 | 0 | Diego details Pachama's technological approach, using remote sensing and machine learning algorithms to verify carbon storage directly and remove broker middlemen. | |
| Corporate Emissions Footprints, Offset Magnitudes, and Pricing Structure | 4 | 5 | 0 | 1 | Gustav and the host drill into concrete figures on employee emission calculations, hectare-to-carbon ratios, and global reforestation drawdown potential. Diego details the mathematics of 200 gigatons of carbon drawdown potential across a billion hectares. | |
| Building Trust, Digitizing Carbon Credits, and Avoiding Double Counting | 3 | 4 | 0 | 1 | Gustav asks how Pachama prevents double counting and rebuilds trust in voluntary offsets. Diego explains registry reconciliation and digital asset tracking across international Paris Agreement accounting frameworks. | |
| Forest Project Categorization and Ecosystem Carbon Dynamics | 3 | 5 | 0 | 1 | Diego breaks down the four categories of forest projects—conservation, improved management, reforestation, and afforestation—and explains how old-growth canopy dynamics sustain continuous carbon sequestration. | |
| Machine Learning Infrastructure and Canopy Carbon Estimation Accuracy | 3 | 6 | 0 | 2 | The host asks how ML models distinguish biodiversity and species groups from canopy height data alone. Diego explains convolutional neural networks trained on LiDAR ground truth plots with under 1.5% prediction error. | |
| Data Collection Challenges, Satellite Partnerships, and NASA JEDI LiDAR | 2 | 5 | 0 | 0 | Diego discusses data bottlenecks, satellite partnerships, and the integration of NASA's JEDI LiDAR data from the International Space Station, alongside onboarding early enterprise customers. | |
| Consumer Responsibility and Venture Capital Fundraising for Climate Tech | 3 | 4 | 0 | 1 | Gustav inquires into investor reception for climate tech startups. Diego details raising capital from top tier angels by pitching strong marketplace network effects alongside remote sensing defensibility. | |
| Balancing Mission with Venture Scale and Career Advice for Tech Talent | 3 | 3 | 0 | 1 | The host probes whether mission-driven startups pitch differently than standard tech companies. Diego explains demanding long-term mission alignment from venture backers and offers career avenues for software engineers wanting to tackle climate. | |
| Research Strategies for Non-Expert Founders and Environmental Policy | 2 | 4 | 0 | 0 | Gustav and Diego discuss policy frameworks, regulation-driven market creation, and how non-domain founders should conduct extensive foundational research with academic and industry experts. |
Statements from this episode (24)
Saez-Gil: Less than 2% of $80B carbon market funds forestry
“According to the World Bank last year, over eighty billion dollars went into carbon market initiatives around the world. And yet, when you look at the percentage of that funding that is going to forest conservation and restoration is less than two percent.”
Saez-Gil: Certifying a forest for carbon credits costs up to $400,000
“If you want to certify a forest project today, let's say that you want to plant trees, you have a land and you want to, you know do reforestation or do forest conservation, you have to do a certification process that takes two years and it costs between a 104 …”
Saez-Gil: Fewer than 50 certified forest carbon projects exist in US
“In the US there are less than 50 projects that got certification for carbon credits, and in South America there's less.”
Saez-Gil: Remote sensing and AI allow precise forest carbon estimation
“Those data points of the forest, and you can be incredibly precise today at estimating carbon storage and carbon capture by forest.”
Saez-Gil: Traditional carbon offset markets rely on multiple intermediary layers
“Today companies that want to purchase carbon offsets, they generally have to go to brokers. The brokers get their credits from, you know, a trader, the trader maybe from a retailer, the retailer from a, you know, a lot of middlemen along the way.”
Saez-Gil: Software company emissions average six tons per employee annually
“There is an estimation that, that, you know, for a company like that, It's about six tons per employee per year, the emission.”
Saez-Gil: Carbon credit prices range between $5 and $20 per ton
“Today, you know, prices, prices of carbon credits range between five and 20 dollars.”
Saez-Gil: Offsetting a software employee's footprint costs $50 to $150 annually
“Between 50 and a 150 dollars. Per employee per year for a service company. At that price level.”
Saez-Gil: One hectare of full-grown forest contains about 200 tons of carbon
“One hectare of land of full-grown forest contains about 200 tons.”
Saez-Gil: A trillion trees could draw down 200 gigatons of carbon
“There is about one billion hectares in the planet that are available for forest restoration without competing with agriculture, In that land, you can plant about a trillion trees, and that trillion trees has the potential to draw down about 200 gigatons of car…”
Saez-Gil: Carbon market capital flow is growing 50% year-over-year
“The flow of capital going to carbon markets is growing. 50% year over year since the Paris Agreement.”
Saez-Gil: New airline regulations demand 160M tons of carbon offsets annually
“All the airlines starting in twenty-twenty-one will have to offset their emissions. This is by regulations, right? Mm-hmm. It's called the Corsia Framework. Yeah. We are talking about a 160 million tons per year that are gonna be demanded by the market.”
Pachama turns carbon credits into digitally traceable assets
“We're trying to make it a digital asset in which you can trace digitally everything from how a credit was issued, how it was calculated, how it's monitored, and how it's traded.”
Saez-Gil: Old-growth forests remain net carbon sinks
“All growth forests continue to capture carbon. The Borneo forest that has millions of years continues to capture carbon, and while a forest, like every living, ah, ecosystem and organism dies out and regenerates, and when a tree dies out, yes, it releases some…”
Wood is significantly more sustainable than concrete for construction
“Wood is a very sustainable material, way more sustainable than concrete or other materials, so we should Continue having tree plantations and harvesting for wood generation, and I think that doing improved forest management on, on timber areas is, is an import…”
Pachama's ML model predicts New England forest carbon under 1.5% error
“And we demonstrated, this is the work of, ah, Elias, who is the PhD that works with us, ah, for four years he was working on this and he demonstrated in New England, less than 1.5% error at predicting how much carbon is there in a forest, comparing...”
Pachama partnered with the world's two largest satellite companies
“We partnered with the two largest satellite companies in the world, and we're, you know, sourcing really good imagery from them”
Pachama onboarded 10+ projects and closed 10+ customers in year one
“We onboarded over 10 forest projects in the US and Brazil into our platform that we analyzed, validated, and, you know, listed on our platform. We have closed over 10 customers.”
YC's climate tech Request for Startups generated unprecedented press interest
“This is one of the, I think the, probably the request for start, request for startup that generate the most amount of press interest of anything we ever done.”
Pachama raised double its target from Ryan Graves, Sacca, and Accel
“We ended up racing almost twice as much as we wanted to race initially from an amazing group of people. Our lead investor is Ryan Graves, the co-founder of Uber. He, who has experience building a global marketplace. We got investment from Chris Saka, who, you …”
Diego Saez-Gil told Pachama investors mission will always precede profits
“I told them before accepting their money, look, okay, now you're convinced that this is a good business. I want to tell you, this is a long-term company. It's mission driven. Always the mission is going to be before profits. And it's going to take time. You kn…”
Founders do not need domain expertise, only resource attraction skills
“And you don't have to be an expert. That's the thing about entrepreneurship. You just have to be good at attracting, you know, resources, right?”