February 23, 2024

Supercriticala carbon removal marketplace (for now) aimed primarily at tech companies looking to reach “net zero,” has raised a $13 million Series A round led by Lightspeed Venture Partners.

The round included funding from RTP Global, Greencode Ventures, MMC Ventures, and others.Back in August 2021, we covered Supercritical’s release, when it noted that the tech industry’s carbon footprint had been — embarrassingly — proven to be bigger than the entire aviation industry.

The start-up brings together business needs for cutting-edge carbon removal technology. So, in a similar situation to where Tesla started with an electric sports car to eventually launch a family sedan, Supercritical gives the company access to these innovative technologies that have the potential to scale up beyond just planting some forests and so on, allowing this The new wave of carbon removers scales up.

Supercritical’s marketplace allows companies to buy what it calls “fully vetted and qualified” carbon removal credits up to Science Based Targets Initiative (SBTi) industry standard.

The funding will be used to expand its services to tech companies, but as co-founder and CEO michelle tour Tell me: “We will continue to focus on tech companies, but will also use the funds to expand our product range. Every company in the world must achieve net zero emissions if we are to keep warming below 1.5C. If not buying Net zero cannot be achieved without permanent carbon removal to eliminate remaining emissions.”

Clients of the Supercritical approach include banking platform Tide, algorithmic trading firm XTX Markets, as well as Veriff, Multiverse and IMC.

She notes that momentum is already emerging in the market: “One-third of the global market capitalization has already voluntarily committed to net zero emissions through the science-based target initiative. Every business has to buy permanent carbon removal services, so expand by serving other verticals The opportunity for CDR is enormous.”

Carbon dioxide removal (CDR) refers to the removal of carbon dioxide (CO2) from the atmosphere. Alternatives to carbon offsets are often found to be ineffective at best and even fraudulent at worst.

In June, an investigation by The Guardian, German weekly Die Zeit and SourceMaterial found that more than 90% of rainforest carbon offsets by Verra, the world’s largest certification body, are said to be worthless.

In contrast, carbon dioxide removal (CDR) offsets are the only internationally recognized net-zero offsets that actually remove carbon from the atmosphere and store it permanently.

However, to put it mildly, CDR capacity has so far been disappointing. The Intergovernmental Panel on Climate Change (IPCC) found that, only ~600,000 tonnes of CDR purchased in 2022 – less than 0.01% billion tons We’ll need to remove it from the atmosphere every year until 2050.

As a marketplace, Supercritical says it’s focused on “high-quality, vetted, long-lasting CDR projects,” including biochar, direct air capture (DAC) and enhanced weathering, and reforestation. By pooling demand from buyers, Supercritical says it acts as a market maker, which means the CDR project can then scale up.It’s also buying from cutting-edge climate startups (see the Tesla analogy above) that have new ways to sequester CO22.

In May of this year, Supercritical and carbon culture, a start-up company that converts carbonaceous biomass into biochar on a commercial scale. In 2021, Carbo Culture raised $6.2 million in a seed round led by Silicon Valley VC True Ventures.

Paul Murphy, partner at Lightspeed Venture Partners, said in a statement: “Supercritical is doing something unique. By focusing on carbon removal offsets, they are helping companies invest where they actually have a climate impact, while simultaneously aligning with decarbonization. work in parallel.”

Supercritical is backed by Lightspeed Venture Partners, GreenCode Ventures and MMC Ventures. It was previously backed by LocalGlobe and angel investors including Peter Reinhardt (Twilio Segment and Charm Industrial), Yancey Strickler (Kickstarter), Alice Bentinck (Entrepreneur First), Gustaf Alströmer (Y Combinator) and Evelyn Bourke (Bupa).

The market for startups taking a market or market maker approach is heating up.In May, I covered climate startups CUR8, which has raised $6.5 million from GV for its carbon removal market-making platform. While Supercritical is both a marketplace and sells carbon accounting and removals, CUR8 only focuses on removals and drives supplier demand and access to finance.

The fact that both start-ups are from the UK is also evidence that the UK is seen as an international leader in carbon pricing and regulation.