Founder Mode: Paul Gross, Founder & CEO of Remora Carbon

0:00Carolyn, today we are at Y Combinator's Founder Mode Retreat, and I'm so excited to be here in person with Paul Gross of Remora Carbon. Hi, Paul. Hi. Welcome, Paul. We're just meeting for the first time. We are. You went through the winter 21 batch. That's right. Tell us about your company. I mean, I know a little bit about it, but I want our listeners to know what you do. We're building a device that captures the carbon emissions from a vehicle, and we're focused on semi-trucks and locomotives. So we retrofit onto these vehicles and attach their tailpipe, and then we extract and purify the CO2 from their exhaust.

0:37From the tailpipe. Yes. And we produce beverage grade CO2. So we can then sell it to food and beverage companies. That's wild. That's wild. Beverage grade CO2. You bet. 99.9%. How big is the device? It's pretty big. On a semi-truck, you can picture a big box between the truck and the trailer. Yeah. On a rail application, it's an entire rail car. Oh, oh. So it sits behind the locomotive. Okay. Yeah. And like sucks in air? Yep. So we attach to the top of the exhaust stack on the locomotive, and then we have a duct over to our car. And then we filter out the CO2 on our car and produce liquid beverage-grade CO2.

1:17Why wouldn't every single truck and every single train have this? That's our goal. I know, but who says no to this? Well, I mean, we've built a lot of great partnerships with trucking companies and railroads. Really, the big hurdle is that it's hard technically. And we've spent the last five years solving that problem. Tell me how you got started in your background. Because as Carolyn was pointing out before we started taping, you look very young. I started the company right out of college. And honestly, I was reading news articles online that said, we're in a CO2 shortage right now. Breweries can't get enough CO2 for their beer.

1:56And in college, this was a big emergency for me, right? No beer. Of course, right? So I investigated and realized that we actually have these regional CO2 shortages in the U.S. We mine a quarter of all of our CO2 out of the ground to put in dry ice and drinks. This is the most counterintuitive thing I've ever heard, right? I did not know this part of it. I totally agree. So I was shocked. And then simultaneously, I was learning about all the CO2 emissions from trains and trucks, right? It's the largest sector of emissions in the U.S. So it was like, how can we pair the demand for CO2 with the problem of CO2 emissions?

2:34And just went really deep down the rabbit hole. So what was your major? I was a software engineer. I did data science. So I was not at all a mechanical engineer. I didn't have any knowledge about carbon capture. My first step was to build my own model to understand the technology and realized, I think this could be doable. And so I reached out to a bunch of academics and talked to them and read their papers. And then it seemed like, yeah, it could be doable. In fact, that's how I met my co-founder, Christina, who was one of those academics who I reached out to. No way. Yeah, she had just finished her PhD on mobile carbon capture.

3:11So I reached out to her. And then we had a couple conversations and really hit it off and then decided to start the company together. So you experimented and thought, maybe this could work. And then you said, let's get more serious about this. And Christina, you met her and decided to start something, which was when? That was back in late 2020. So we knew we needed a technical co-founder on the science side. That was Christina. And then we also recruited my co-founder, Eric, who was a diesel truck mechanic for a decade. No, that's great. And then he built electric and hydrogen semi-trucks. And, you know, we felt he would be the perfect mechanical engineering co-founder.

3:52So we applied to YC in late 2020 and did the winter 2021 batch. And that was still virtual, right? Totally virtual. Weird experience. Very weird. But it allowed us to stay in Detroit and build the system in Eric's garage. So that was our first step as we built a little system on a tiny little truck to demonstrate the concept. Got to have a prototype. I'm just going to go out on a limb here and say this right now. You've got to come on the show for reals and do a full episode because I just have way too many questions for you. I can tell already. For a little short span of time here. But since this is our short segment about founder mode, I'm wondering, you've been doing this now for a few years, how big is your company?

4:38It's about 50 people. Okay, so you're still pretty small. Yes. What thoughts do you have on founder mode? Well, I think what I'm able to do that a traditional manager wouldn't is instead of dipping into each area in the company, each vertical, every quarter or so, just think about what are the top three risks to the company? And then I delegate everything else and go really deep on those three risks. So for example, there was a problem with after treating the diesel exhaust coming out of the locomotive, all the soot and ash that comes out of a locomotive. we need to clean that up before it can go through our carbon capture process.

5:16Otherwise, our carbon capture process gets gummed up with all the soot. So we didn't know how to clean up that soot. And we didn't have the right person. We tried to hire someone. So I just went in and learned about it myself and worked alongside the engineers who are working with it and delegated everything else. And I think that approach where you're just really deep on a few top risks has a lot of benefits. You know, you're able to actually work alongside ICs. So you get deep in the org and see kind of, do we have the right team working on this? You learn a lot about the area and then you get better at hiring for that area, which you inevitably will have to do because it's one of your top risks.

5:56And so I kind of think of it as like, there's a conservation of time, right? You can only spend so much time. So you can either go medium deep on everything, or you can just go really deep on a few things. Have you had any consequences, negative consequences, though, of doing the delegation? Because that's one of the aspects of Founder Mode. If you overly delegate, then something happens over here that you weren't paying attention to. 100%. So, I mean, you have to keep an eye on all the other aspects of the business. But, you know, there are a lot of aspects of the business that are running really well.

6:26We have phenomenal engineers. I don't need to be involved in every single subsystem. And I just couldn't with the time that I have. So instead, if I can just choose the places where there is the most struggle, the most challenge, or the most risk, I think that's the best use of my time. And are you the founder that chooses to do this, whereas your two co-founders are like, no, we're doing our own thing, we're good. Or do all three of you decide to do that strategy? I do it the most aggressively across the business. And I do it not just in technical areas. So top risks right now are our CO2 liquefaction system, which is another part of the system, but also selling CO2.

7:06So I'm also really deep talking to different CO2 distributors and understanding that market. And, you know, government affairs at the same time, I'm like really focused on engaging with members of Congress. So it can be totally different areas of the business, but it's really important in my perspective that you, instead of trying to be relatively involved in a bunch of Once that area is solved, you step out and go do something else. And you can hire better for someone to run that area. 100%. If you don't actually know much about that area, you're not going to be able to hire the right people.

7:41So often what will happen is the team is struggling. And so I'll go in, learn about it, and then also can help the team hire. Do the team members, are they like, oh, awesome, you're here. Let's roll up our sleeves together. Are they like, whoa, CEO is kind of in my lane. I'm a little uncomfortable. Or does it vary by employee? It varies, but I think generally they're excited to have the resources. Like I can come in and I think part of what's helpful is I can bring my network and resources. So often I'll bring in some expert from academia or elsewhere to help speed things up. I can just bring my own urgency, which is like, hey, we're meeting about this every day now.

8:17Like this is a huge emergency for the company. And I think I can also just make bigger decisions about our product architecture or customer engagement that an individual engineer might not be able to make. For example, if we need to make the customer experience with our product slightly worse to solve a technical problem, an engineer might feel they couldn't do that. But I can just say, we're going to do that because we have to solve this problem. So I can kind of like blast more obstacles out of the way. But it's also important that I really see whether someone wants the help and wants to solve this problem or is kind of like territorial because that to me would be a bad signal.

8:57Have you always been the type of person that does deep dives and learns about all these new things? Because I'm thinking you were saying dealing with interacting with congressmen and cleaning out the CO2 capture thing. Like all these things are very different. Totally. You have like learned, become an expert in them. Were you always like that? I think that I've leaned into it more over the last five years. I started out thinking, I have to, like, I couldn't possibly know more than these incredible engineers on the team. I need to delegate to, you know, and I was told, like, you have to delegate.

9:29You can't, that's micromanaging to get involved too deeply. Yeah, yeah. Micromanaging. You really get slapped on the wrist for that. That's right. But I realized that actually I can help in these areas. And sometimes a beginner's perspective can be really valuable, especially a beginner who knows all of the different areas of the company and can bring different aspects of the company into the decision-making process. So I think that was where I started to feel like I should be leaning into this. And now the team knows that every time I talk to them, I ask, like, what are the top risks. And then they know that it's like, call in Paul if there's an issue.

10:07This is a weird question, but do you have any trepidation about getting really big? Like when your company's 300 people, are you like, wow, am I going to be able to operate in this kind of founder mode? I mean, that's a great question. I think about that all the time. I think what's nice about this approach is that it is just infinitely scalable because there always will be top three risks to your company, right? So at any point, you can choose the top three and you have to be really brutal about prioritization. Not everything is a top risk. And a lot of areas of the business are running great.

10:40There are great people working on it. I can add no value to it. So I actually think this is the way to continue to be deeply involved, continue to get to know different parts of the organization and learn about the specifics, like the source code of our company, and not just get kind of put up at the top level. And then I don't actually know any of the details. How old are you now? I'm 28. I was going to guess 25. So much more mature than I ever was at 28. Young founder test passing right here. Do you ever get your investors questioning you or because of your young age? I would say that it's our customers more than our investors.

11:20I was going to say, or Congress. They love that I'm like a young founder. I think that the customers, I'm meeting with railroads and trucking companies. I tend to be the youngest person in the room by 30 years. And I think it's just you have to come in super prepared. And honestly, that's part of the reason I do these deep dives is I need to be the most prepared person in the room. I want to know all the terminology about your truck. I want to know how the trucking business works so that you can't ask me a question and I say, I don't know. Because then that confirms everyone's assumptions about you.

11:57That's right. Yes. That's right. So what is going to make Remora get bigger? Is it just because it sounds like you've got the technology. I mean, obviously, I'm sure you're constantly improving it. But is this just like, this is just a sales thing? You've got to go out there and meet every trucking company, every railroad. Right now it's a manufacturing thing. So the next step for us is we've got the technology. We've built carbon capture technology that we think may be 50 % more energy efficient than anything else out there, which we're really excited about. So the next step is we're going to be deploying that commercially.

12:28We need to make sure it's safe and seamless for our customers, which is really important to them and to us. And as soon as we demonstrate that, we can start scaling the production of the system. Do you produce here or else? Here in the U.S. So a lot of our supply chains in the U.S. Congress loves that, I'm sure. They do, right? In Michigan, right? In Michigan, yeah, like heartland. Sorry, it's so random. Tariffs? How are tariffs treating you? Well, the good news is most of our supply chain is in the U.S., so it has not been a huge impact on us so far. Thank goodness. Yes. We had one key supplier in China, but we have found an alternative in the U.S.

13:05Nice. And otherwise, we're in really good shape on tariffs. That's good. I know that's a little bit of a random, but... I mean, I think it's a really critical question for hardware businesses. You know, that can completely blow up your bill of materials. And, you know, for us, there's a dual benefit of being here in the U.S., which is you want the engineers to be on top of the production process so that there's this fast iteration where, you know, someone out in the shop is pissed off with the engineer for their design and comes up to the engineer and says, what the hell? you know like that's a much better learning process than it being like across the country i think we should have paul back i i think yes i think i have lots of questions you're gonna have to come back on the social radars because my mind is sort of swimming i sort of feel like this is a good place to end for today's founder mode session that sounds great okay to do it well thanks for coming on today thanks for having me all right great pleasure