48. Watershed

Founders: Christian Anderson (CEO), Taylor Francis, Avi Itskovich
Launched: 2019
Headquarters: San Francisco
Funding: $239 million
Valuation: $1.8 billion
Key technologies: N/A
Industry: Climate, enterprise technology
Previous appearances on Disruptor 50 List: 0

ESG may be under fire after being on fire for years among the world's biggest companies and investors, but regardless of political winds tied to the market, climate change isn't going away as a major risk for corporations and their shareholders.

Clients from the world's largest retailer, Walmart, to the world's largest asset manager, BlackRock, to hot consumer brands like Kim Kardashian-founded Skims and even fellow disruptor Stripe, are using the enterprise software sustainability platform Watershed to run climate programs that generate results. 

Watershed delivers audit-grade carbon measurement, one-click reporting, and quantifiable emissions reduction. Watershed customers also have access to its marketplace of scientifically vetted carbon removal projects and offsets, such as renewable energy and sustainable aviation fuel – key after years of too many "greenwashing" examples that showed many carbon goals amounted to little more than opportunism and talk.

Despite the pushback against corporate climate commitments – many major companies have seen emissions go in the wrong direction after the Covid economic boom – large companies cannot ease up on their net-zero goals, with regulatory mandates increasing around the globe.

This year, the SEC issued its final climate disclosure rule for U.S. companies. Overseas, the climate mandates are already far ahead: 2024 represents the first year of government-mandated climate disclosure for nearly 12,000 global companies under the European Union's Corporate Sustainability Reporting Directive. 

General Mills, Carlyle Group, Paramount, Visa, and four of the top six U.S. banks are among Watershed's clients. Two-thirds of the Fortune 500 have made significant climate pledges.

With a policy advisory board chaired by former Bank of Canada Governor Mark Carney, and a science advisory board chaired by prominent UC Irvine climate scientist Steven Davis, Watershed's biggest round of financing to date occurred this February, when it raised $100 million from investors including Greenoaks, Kleiner Perkins and Sequoia, a deal which almost doubled its valuation compared to its last VC raise.

In announcing the new investment, Watershed noted that two years ago at the time of its Series B, it covered clients that managed an estimated 20 million tonnes of CO2 equivalent. In aggregate, Watershed says its customers now manage over 479 million tonnes of CO2, up more than 10x in the last year. By the numbers, that is greater than the total annual emissions of France. 

Watershed's goal is to decarbonize the private sector by reducing or removing 500 megatonnes of CO2 from the earth's atmosphere every year by helping companies measure their emissions, identify opportunities to reduce emissions, and when necessary, remove the rest. Its market goal, which is ambitious, is stated by the company in simple terms: "We expect Watershed will become the default operating system for climate practitioners in every organization on earth."