Oasis: Less CO2 for you

Executive Summary

Oasis is a company offering carbon reduction with the mission of leaving a clean planet for future generations. We use bioengineering to leverage natural carbon capture processes in ocean phytoplankton to remove CO2 in an effective and measurable way.

Oasis aims to give corporations an option to balance out their carbon emissions, by selling carbon offsets to them. Corporations can choose to offset all of their carbon emissions, and become carbon neutral by buying Oasis offsets which equal their total carbon emissions. Oasis offsets carbon emissions through the photosynthesis of phytoplankton, which has the fastest carbon dioxide fixation rate amongst all known biology. The phytoplankton will be grown in bioreactors equipped with nutrients for sustained growth, and introduced to the ocean using barges. They will photosynthesize with resources from the ocean such as water, sunlight, and carbon dioxide, thus reducing the amount of carbon dioxide in the atmosphere. We will use their nutrient consumption levels to determine how much carbon dioxide the phytoplankton have removed from the environment at any given time.

The carbon offsets industry is small, relatively new, and is enjoying increasing popularity due to the rise in environmental consciousness over the last ten years. The market value of carbon offsets rose to about 300 million dollars in 2018, up from 120 million dollars in 2016. Oasis will primarily target corporations because they account for 75% of business actions in the carbon offset market. Certain industries have begun carbon emission capping and reduction initiatives. The Carbon Offsetting and Reduction Scheme for International Aviation (CORSIA) will implement an emissions cap for 75% of international flights starting in 2021. Additionally, companies such as Amazon, Microsoft, and Etsy have pledged to become carbon neutral or carbon negative in the future. Between regulatory constraints and voluntary carbon reduction efforts, there is potential for more growth in the carbon offset industry.

Existing companies are often not transparent to customers about how exactly their services contribute to carbon reduction, and their efforts are often ephemeral and unsustainable. Compared to current carbon offsetting approaches, Oasis provides efficient, long-lasting, and calculable offsets to fill the information and longevity gap in the voluntary carbon industries. Our measurability will allow us to successfully differentiate Oasis as a company with a paper trail, and with bioengineered phytoplankton, we can prove that our methods are effective.

Our core approach to reach our customers will be direct sales to airline companies regulated by CORSIA. Because the emergence of the Carbon Offset Reduction scheme for international aviation, or CORSIA, which will by 2021 require airlines operating in the 78 countries that have signed up to bear the responsibility of offsetting carbon emissions that are over 2020 levels. Furthermore, the airline industry grows at a rate of 4% yearly, and presents a $1.5 billion opportunity. After we successfully reach our initial customers, we will keep long-term relationships with them, such as conducting long-term contracts and providing after-sale service. Our marketing team will help us with branding and promoting as well through our company website and social media channels. Further, we will take advantage of the current push toward sustainability in politics and popular culture, and will post video campaigns on social media, and collaborate with young climate activists to create awareness for our service. We will connect with customers actively to get feedback which will increase customer satisfaction and our net promoter score.

Oasis' operations will focus on delivering on our values of being high-quality and effective. To do this, we will in-house our bioengineered phytoplankton R&D and production, as well sales. By doing the R&D and production of the core of our service, we can guarantee higher quality and efficacy of our phytoplankton. We will also do sales in-house because it’s important that our sales team is highly educated about our product and can explain our product value to customers. Additionally, we want to be sure to have a tight feedback loop between customers and our development team so that we can continuously improve our offering. We will, however, outsource barge operations because this aspect of our operations is not highly technical and there are existing companies that manage large fleets of boats. Outsourcing barge operations means that once our phytoplankton development is in place, we will more easily be able to scale up as barge operations are taken care of, and take advantage of economies of scale. Our operations reflect our commitment to the quality of our carbon offset product.

In the first two years, we will be working on R&D, so the net earnings will be negative. But after we start selling carbon offset services to our initial customers, our net earnings will become positive by 2023. With our sales expansion, we plan to sell 1 million tons of carbon offsets to the customers in 2025, which will lead to $20 million dollars revenue and $10 million dollars net earnings. Our R&D and phytoplankton production facilities will require that the majority of our capital be infused in the early stages of our company’s growth. Thus, Oasis is seeking $1.2 million to fund our product development. The founders will invest $100,000 as the initial capital, and raise $500,000 in the seed round for research and development purposes. Oasis will raise $700,000 in Series A funding in 2023 to fund manufacturing and operations. The average price/earnings ratio of the environmental services industry is about 30, hence, taking the projected net earnings into account, we expect the company to be valued at $301 million in 2025.

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