ANALYSIS: CDR companies dominate funds raised in VCM in the last four months
Quantum Commodity Intelligence – The carbon dioxide removals (CDR) sector once again dominated funds raised by companies in the voluntary carbon market (VCM) between May 1 and the end of August, according to data compiled by Quantum based on announced deals. The sector accounted for over $271 million of the $377 million raised by the wider VCM in the period. This was up on the $254 million secured by CDR companies in the opening four months of the year.
However, the overall figure of $377 million was down on the more than $566 million raised in the first four months of the year. The overall figure rises to just under $430 million if money secured by funds is included in the fundraising. The total raised, including funds, topped $1 billion from the start of January till the end of April.
Markeplaces raised almost $42 million, down from $88 million, while companies in the monitoring, reporting and verification (MRV) space raised just under $40 million, a rise on the $28.1 million secured in the first four months of the year. Project developers raised only $17.1 million in the latest period, down on the $128 million brought in at the start of the year. Below Quantum outlines where the money has been raised in various sectors of the VCM.
Project developers ($17.1m)
Boomitra
California-based soil carbon project developer Boomitra secured new equity investment in August from the government-backed Global Innovation Fund (GIF) to expand its carbon projects. Boomitra said it plans to use the $500,000 investment to expand activities in Mongolia, Colombia, Brazil, Botswana and regions across Central and Southern Mexico.
Creattura
Tokyo-based Creattura raised JPY350 million ($2.4 million) at first close in August of its Series A funding round to grow the business and expand across Southeast Asia. The company said funding had been secured from DBJ Capital and Mitsui Sumitomo Insurance Capital Company for overseas expansion and IT product development.
"With the funds raised this time, the company will accelerate the development of carbon projects and IT/SaaS in Japan and abroad to meet the dramatically increasing demand in the future," the company said.
Creattura is already working on a carbon project under Japan's Joint Crediting Mechanism with Kubota Corporation and Tokyo Gas in the Philippines that aims to reduce methane emissions from rice production. It is also looking to expand in other Asian countries, including Vietnam and Thailand, the company said.
Morfo
French sports stars Antoine Dupont and Raphaël Varane invested in a French-Brazilian start-up called Morfo, which performs afforestation, reforestation and revegetation (ARR) in Latin America. Morfo raised €4 million ($4.3 million) in this latest round, bringing its total so far to €11 million. The company did not specify how much the rugby star, Dupont, who was elected the world's best player in 2021, and former football world champion Varane contributed. The company is working on 20 projects in the Atlantic Forest and the Amazon biomes in Brazil as well as in French Guyana and Gabon.
Tree.ly
In July, Austro-German start-up Tree.ly said it had raised €5 million in seed finance to fund the expansion of its forest carbon projects in Europe. The investment came from venture capital firms PortfoLion Capital Partners, Aws Gründungsfonds, and SymbiaVC, and the Tyrolean Business Angel network, which invests in early-stage start-ups.
Tree.ly said the money will be used to grow business in its five European markets – Austria, Germany, Czech Republic, Italy and the Netherlands – where it currently has 180,110 hectares of forest contracted to store over 2.8 million tonnes of carbon dioxide equivalent (tCO2e). The finance will also be used to develop an updated version of its carbon sequestration standard and improve the functionality of its carbon platform.
Removall/ Guteka Neza
The Guteka Neza clean cookstoves project located in Rwanda managed by France-based developer Removall has raised €1.3 million in a crowdfunding campaign online. The fundraise closed two weeks earlier than anticipated back in May on B2C platform Lendosphere, which enables companies to obtain loans from individuals with spare funds. In total, 957 individuals participated in the crowdfunding and a single individual gave as much as €110,000 of their own funds.
ByWill
Japanese environmental consultancy ByWill raised a further JPY180 million to close its Series A funding with a total of JPY480 million secured from 15 companies to help support its plans to promote decarbonisation across Japan's 47 prefectures. The JPY180 million came from eight companies: SMBC Venture Capital Corporation, Kiyo Bank, Hirogin Capital Partners, Mitsubishi UFJ Capital, Iyogin Capital, Higin Capital, QR Investment and Gifu Shinkin Bank, ByWill said in a statement.
Carbon removal ($270.75m)
Svante
Canadian public investment vehicle Canada Growth Fund (CGF) is to invest up to $100 million in compatriot CDR solutions provider Svante Technologies to support the company's North American commercial carbon capture and removal projects. The money will be paid in tranches, aimed at accelerating the deployment of Svante's carbon capture technology.
CarbonQuest
US carbon capture technology provider CarbonQuest completed a funding round aimed at expanding the distribution of its modular carbon capture systems. The initial closing on its Series A brought in undisclosed funding from Texas-based Riverbend Energy Group. "The funding will enable CarbonQuest to offer its Distributed Carbon Capture technology to a broader range of carbon emitters and accelerate market penetration of its cost-effective and economically viable solution," the Washington State-based company said.
Applied Carbon
US biochar technology company Applied Carbon in late July raised $21.5 million in Series A finance to help with the deployment of its mobile biochar machines in Arkansas, Louisiana, Oklahoma and Texas. Funding was led by TO VC, with participation from Congruent Ventures, Grantham Foundation, Microsoft Climate Innovation Fund, S2G Ventures, Overture.vc, Wireframe Ventures.
Autodesk Foundation, Anglo American, Susquehanna Foundation, US Endowment for Forestry and Communities, TELUS Pollinator Fund for Good, and Elemental Excelerator also participated. The company, formerly known as Climate Robotics, plans to deploy its mobile machines, which pick up agricultural crop residue left from harvesting and converts it to biochar, to deliver CDRs and agricultural services.
Graphyte
CDR project developer Graphyte closed $30 million of Series A funding in July that will be used to speed up deployment of its 'carbon casting' technology in new facilities that sequester carbon-containing biomass waste underground. Graphyte said the funding was co-led by US-based investors Prelude Ventures and Carbon Direct Capital, while current investors Breakthrough Energy Ventures – backed by Microsoft founder Bill Gates – and Overture also participated.
The company's Loblolly project in Arkansas, which is already operating, will reach a capacity of 50,000 tCO2/year in early 2025, it said. The Series A financing would enable the launch of an additional four carbon removal facilities over the course of 2025 and 2026 as part of the company's plan to remove at least 5 million tCO2/y by 2030.
Cowboy Clean Fuels
US-based CDR company Cowboy Clean Fuels (CCF) raised $13 million in series B funding to help commercialise its technology that sequesters carbon while also producing renewable gas. CCF said the financing was led by Houston-based Machan Investments, and together with $7.8 million in funding from the Wyoming Energy Authority (WEA) will support the development of the former's first commercial project in the Powder River Basin region of Wyoming.
The Triangle Unit Renewable Energy and Carbon Capture and Storage project utilises depleted coal bed methane wells and biomass with carbon removal and storage plus renewable natural gas (BiCRS+RNG) technology. "This capital, along with the WEA matching funds, will enable us to fully commercialise the BiCRS+RNG process and realise the technology vision behind it, which is nearly 20 years in the making," said Ryan Waddington, CCF chief executive.
Carbon Blue
Israel-based CDR company CarbonBlue raised $10 million in seed funding to help expand its international presence and scale-up its direct water capture CDR technology. The funding round was led by compatriot investment vehicles Ibex Investors and FreshFund, together with the venture capital arms of French energy company Engie and Zim Integrated Shipping Services – Engie New Ventures and Zim Ventures. Further finance was also secured from existing investors Jibe Ventures, MoreVC and Secret Chord Ventures, the CDR company said.
BlueGreen Waters Technologies
Israeli water-based CDR firm BlueGreen Water Technologies closed a Series B funding round "in the double-digit millions" in July. The funding round, led by TAU Capital with support from OurCrowd, will enable the company to accelerate the market penetration of its technology to eliminate harmful algal blooms and sequester CO2 in freshwater bodies, Bluegreen said. The money will also enable it to "continue the development of its carbon dioxide removal business unit as the company expands research into marine-based CDR while cultivating new remediation project opportunities across global markets".
Bio-Logical
Kenya-based biochar project developer Bio-Logical secured $1.3 million in funding to expand production and meet rising corporate demand for CDR credits. The new financing would enable the company to scale up its annual removal capacity to 100,000 tCO2 between now and the end of 2025, and increase the volumes of biochar for use by smallholder farmers in Kenya.
"This funding round will play a pivotal role in scaling up our Mount Kenya facility and building a tonnes blueprint for scale as we roll out three new sites throughout Kenya over the next 18 months," said Rory Buckworth, joint-chief executive of Bio-Logical. The latest funding round includes finance from CrossBoundary and Redshaw Advisors, as well as fresh capital from existing investor, the Steyn Group.
KC8 Capture Technologies
Melbourne, Australia-based KC8 Capture Technologies raised AUD10 million ($6.74 million), with investment coming from compatriot energy company Woodside, Cemex Ventures – the venture capital arm of Mexican cement giant Cemex – and an unnamed "major" petrochemicals firm. The company's removals technology aims to be deployed in hard-to-abate sectors using a proprietary non-toxic solvent that is derived from a naturally-occurring material.
Fugu
Sydney-based Fugu said it had secured over AUD1 million in a seed round. Fugu said investment had come from venture capital firms Investible, Counteract, Jelix Ventures and Electrifi Ventures. The money will be used to develop the company's "design-for-manufacturing machine", with a future Series A financing round in 12 to 18 months time. Fugu's containerised direct air capture (DAC) will remove CO2 from the air and ship it for use in other industries, such as sustainable aviation fuel and methanol.
Sirona Technologies
European DAC company Sirona Technologies raised €6 million from investors in order to build its first facility in Kenya. The funding round was led by venture capital firms LocalGlobe and XAnge, with five other unnamed investors involved. The Brussels-based company's pilot plant in Kenya will be operational by the end of the year, while a "full-scale commercial plant" is planned for early 2026, the company said.
Neustark
Concrete sector-focused CDR developer Neustark raised $69 million in funding to underpin global expansion and its plans to scale up total capacity to 1 million tCO2 captured and stored by 2030. The Switzerland-based company said in June that Decarbonization Partners, a partnership between US investment giant BlackRock and Singaporean government-owned investment firm Temasek, led the growth equity round.
Climate tech investor Blume Equity also participated, while Swiss investment bank UBS has contributed capital to the round via debt financing. "This growth investment will take us into the next exciting phase of our mission, helping us to further scale our impact across Europe, enter new markets in North America and Asia Pacific," said Johannes Tiefenthaler, co-CEO and founder of Neustark.
Planetary Technologies
Canada-based non-profit British Columbia (BC) Centre for Innovation and Clean Energy (CICE) allocated $1.9 million to a small-scale ocean alkalinity enhancement (OAE) field trial located near Vancouver.
The field trial, projected to start in spring 2025, will add a small amount of mineral alkalinity (antacid) to the outflow of a local wastewater plant and help Canada-based carbon project developer Planetary Technologies measure the absorbed CO2 and biological changes associated with the intervention.
EcoLocked
German climate tech company EcoLocked has raised €4 million to expand its activities using biochar to create carbon-negative building materials.
The seed funding round was co-led by climate-focused venture capital companies Matterwave Ventures and Climentum Capital, with participation from existing investors Counteract, SFO, Sabanci Building Solutions, and Voyagers. Berlin-based EcoLocked "provides functional, carbon-negative building materials to reduce the net carbon footprint of construction projects," the company said.
Husk
Cambodian biochar developer Husk raised $5 million to expand operations in two Asian countries in May. The money came from Vietnam-based private equity firm Mekong Capital through its Mekong Enterprise Fund IV vehicle. Husk will use the funds to "streamline" its operations in Cambodia and to create a production plant in Vietnam.
eAgronom
Estonian agricultural technology start-up raised €10 million to help it expand into new markets and scale its existing sustainable farming programmes. Tartu-based eAgronom said the Series A2 equity round includes €4.2 million raised during a 'booster' round in 2023, that has now been converted to equity, plus €5.8 million secured this year.
Funding was led by Nordic-Baltic banking group Swedbank with a €4 million investment, together with venture capital firms Icos Capital and Soulmates Ventures, and the Estonia-focussed SmartCap Green Fund. The company said it plans to raise a further €2 million to €4 million later this year.
Marketplaces ($41.62m)
Asuene
Japan-based climate tech start-up Asuene has raised JPY 5 billion as part of plans to secure JPY10.1 million in Series C funding to help grow the business and expand its global reach. In June, it announced JPY4.2 billion had been secured in a first close. Lead investors are Sumitomo Mitsui Banking Corporation, SBI Investment and Sparx Group – through its Mirai Creation Fund III – out of a total 17 domestic and overseas investors, including new and existing shareholders.
The funding will be used to boost staff levels, expand sales and marketing through investment alliances, increase investment in technology development, develop new business lines and expand in Asia, US and elsewhere.
Other investors include MyRata, Ricoh, Daiwa House Group Growth Fund, Nippon Express, KDDI Green Partners Fund, GMO Venture Partners, Salesforce Ventures, Strive, Glin Impact Capital, and Energy & Environment Investment.
In August, it raised over JPY800 million for the second close of its Series C finance round, bringing the total secured to JPY5 billion, to grow its business. Investors in the latest round include Japan Institute for Decarbonisation and Renewal, Nippon Life Insurance Company, Nissay Capital, Jera, Pavilion Capital and private investor Hideki Kojima.
Japan Carbon Credit Exchange
The company behind the Japan Carbon Credit Exchange (JCX) has raised additional funding through a seed round, with some of the new money being used to increase the range of available projects under the country's J-Credit offset scheme. Japan GX Group said on August 1 that it has secured JPY 210 million in total, of which JPY160 million is new funding for the expansion of JCX, which aims to become one of Japan's main platforms for the trade of government-certified J-Credits. "The funds raised will be used for product development and strengthening of recruitment and organisational structure," Japan GX said.
Net Zero Company
Net Zero Company (NZC), a Sweden-based company founded by retail giant Ikea's former head of sustainability, has secured $5.5 million of seed money for a blockchain-based CDR token derived from a range of nature-based projects. NZC said investment was led by Switzerland-based Varo Energy and its nature-based solutions subsidiary SilviCarbon and Dutch downstream energy firm Oilinvest, among others. The company will use the money to expand globally and launch new products, including a Carbon Removal Token that aims to give buyers full traceability and make them easier to buy.
Xpansiv
Environmental commodities exchange platform Xpansiv said in May it had received capital investment from the venture capital arm of Saudi energy firm Aramco to fund development of environmental markets solutions, as well as investment and acquisitions. The investment is from Aramco Ventures' Sustainability Fund, which targets companies capable of aiding the world's largest oil producer's net-zero Scope 1 (direct) and Scope 2 (indirect from electricity use) greenhouse gas emissions targets, and apply across the energy company's wholly-owned and operated assets by 2050. The size of the investment wasn't disclosed.
MRV ($38.31m)
Coastal Carbon
In Canada, CICE also allocated $870,000 to a pilot scheme focussing on the development of a remote seaweed biomass monitoring solution along BC's coastline, the organisation said. US-based Coastal Carbon will pilot the seaweed biomass monitoring solution as part of restoration and expansion of seaweed carbon sequestration projects along a 26,000 kilometre-long coastline.
Space Intelligence
Scotland-based Space Intelligence, a start-up that provides satellite data to the carbon credit sector, raised Series A funding to expand operations from specialist investment firm AzurX Space Ventures and energy commodities bourse Intercontinental Exchange. The total amount of the Series A funding raised is thought to be in the region of $7 million, according to sources with knowledge of the deal.
The proceeds will be used to expand the company's library of mapping data and analysis of global forest cover, which "will support the development and financing of forest carbon projects, as well as nature impact monitoring across corporate supply chains", Space Intelligence said. "This expansion is driven by the company's integrated process of geospatial analysis and ecological expertise, leveraging artificial intelligence," the company said.
Sagri
Japanese agri-tech company Sagri raised JPY1 billion in Series A finance to expand its business. Sagri uses AI, satellite technology and remote sensing to measure greenhouse gas emissions reductions. The finance providers include Chiba Dojo Corporation, Global Brain, Spurcle, SMBC Venture Capital Corporation, and Shizuoka Capital.
Other investors are Aozora Corporate Investment, Big Impact, Ikeda Senshu Capital, Hokkaido Venture Capital, Rheos Capital Partners, Globis, Kirin, Yamato's Kuroneko Innovation Fund No.2, Canon Marketing Japan's Mirai Fund, Kobashi Holdings, Asai Farm Company, G-Startup, and Shimadzu Corporation. Angel investors have also been involved in the latest funding round.
Earthshot
Earthshot, a US-based platform for developing nature-based carbon projects, completed a $5.5 million Series A financing round in July. Funding was led by Acorn Pacific Ventures with participation by Earth Foundry, Future Ventures, Resilient Earth Capital, One Small Planet, Parameter Ventures, Sand Hill Angels, and Orca Capital, the company said.
DeepForest Technologies
Japanese technology start-up DeepForest Technologies raised JPY200 million in Series A funding to help accelerate the implementation of its forest analysis technology and carbon credit business in Japan and overseas. DeepForest said the money had been raised through a third-party allotment of new shares with Environmental Energy Investment, Bio-Site Capital & SBI Regional Revitalization Support, Mitsubishi UFJ Capital, Chushin Venture Capital, and Kyoshin Social Capital as the underwriters.
Rize
Singapore-based agritech start-up Rize raised $14 million in Series A funding to augment its offerings through its platform for sustainable rice farming and further broaden its presence in Southeast Asia.
The funding round was co-led by Bill Gates-founded Breakthrough Energy Ventures, Singaporean government-owned investment firm Temasek, Temasek's GenZero investment platform subsidiary, and Southeast Asia-focused venture capital firm Wavemaker Impact.
"This investment will enhance Rize's technology stack including its measuring, reporting, and verification (MRV) technology and support further expansion into Indonesia, Vietnam, and across South and Southeast Asia," the company said in May.
HabiTerre
US-based agri-tech firm HabiTerre has raised $10 million in a Series A investment round to expand its software. "This investment validates and enables the potential for our technology to support the development of efficient market mechanisms that reward farmers for production efficiency and improved environmental outcomes," said Nick Reinke, chief executuve of HabiTerre in a statement.
HabiTerre said its technology aims to address the challenge of accurately measuring GHG emissions and soil carbon outcomes in agriculture.
Chloris Geospatial
US forest data company Chloris Geospatial welcomed new investment in May from the Cisco Foundation and NextSTEP. Chloris said the undisclosed new funding will enable it to "meet the evolving needs of the market, while facilitating continued commercial growth".
ATEC
Australian producer of cleaner cookstoves ATEC raised $3.75 million in a Series A funding round to support expansion in Asia and Africa of its 'Internet of things' (IoT) electric stoves. ATEC said funding was co-led by Schneider Electric Energy Access Asia and Spark+ Africa Fund, with other investors including trading firm DRW, Save the Children Australia Impact Investment Fund, Kibo Investments and iDE. "ATEC will expand its partnerships with last-mile distributors and carbon buyers across Asia and Africa," said ATEC co-founder and chief executive, Ben Jeffreys.
The company will also use some of the money to invest in research and development, in particular the latest developments in IoT and Web3.0, it added. The IoT technology means usage of the company's stoves can be tracked 'live' helping to overcome concerns about auditing improved cookstoves use for carbon credit generation, the company said.
Funds ($60m)
Silva Carbon Origination Fund
Australian airline Qantas joined mining giants Rio Tinto and BHP as foundational investors in a new fund that plans to develop nature-based carbon projects to generate carbon credits in Australia.
The Silva Carbon Origination Fund aims to raise AUD250 million to originate and manage high-integrity Australian Carbon Credit Units (ACCUs), with the foundational investors committing AUD80 million, Qantas said on August 12.
Brazil lenders
In May, Brazil's national development bank BNDES said it signed an agreement with other major lenders and the country's environment ministry for BRL30 million ($5.91 million) to prepare projects, including forest restoration in several states, which aim to earn carbon credits as the main source of revenue.
BNDES, officially known as National Bank for Economic and Social Development, signed the agreement with the Ministry of Environment and Climate Change, the Forest Service Brazilian Bank (SFB) and the Inter-American Development Bank.
"The acts aim to prepare projects to grant sustainable use conservation units that include restoration and environmental management as an economic activity," BNDES said in a statement related to the event to formalise the agreement.
The bank said the agreement with the SFB will help it support restoration projects of the Bom Futuro National Forest in the northwestern state of Rondônia for an area of 17,000 hectares, and the Gleba João Bento, which covers both Rondônia and Amazonas, for a combined area of 55,872 hectares.