Climate-tech start-up goodcarbon has secured €5+ million in pre-seed funding, to accelerate the investment into nature-based climate solutions and the trading of related carbon credits. The funding round was led by Planet A Ventures, with participation from Greenfield One, 468 Capital, and a group of high-profile Angels.
To reach the 1.5° pathway, we need a net emission reduction of 50% or 23 gigatons of CO2 until 2030 – every year. In addition, 2 billion hectares of degraded land need to be restored and biodiversity needs to be rebuilt. Investment in the Nature-based Solutions (NbS) such as the conservation and restoration of forests or oceans are an answer to this challenge.
“Corporates around the world need to fulfill their net-zero pledges and are willing to invest into NbS projects”
The latest IPCC report lists NbS among the top five most effective strategies for mitigating carbon emissions by 2030.
“Nature-based Solutions can contribute 30 to 40 percent of the decarbonization needed until 2030 and provide additional benefits, beyond carbon, by restoring integral ecosystems. Corporates around the world need to fulfill their net-zero pledges and are willing to make investment into NbS projects, as they get carbon credits in return,” added David.
Utilizing the power of nature only works if such projects receive the necessary funding. In total, Natural Climate Solutions need $8 trillion USD of investment. However, despite the upsides, they currently receive less than 3 percent of all global climate funding.
“We have a major supply problem as project developers face significant challenges. They have high upfront costs, but a lack of funding, little appreciation of co-benefits such as biodiversity protection, and a high dependence on brokers. We are here to solve these challenges by converting natural capital into financial products”
What Does This New Climate Tech Do?
Through their investment and trading platform, goodcarbon is connecting NbS projects to capital, enabling corporates and investors to take immediate and impactful climate action. Project developers can monetize their future carbon streams from high-quality NbS projects, through the issuance of goodcarbon tokens at project registration.
Thus, they are enabling the transaction of carbon credits prior to verification and issuance of carbon units from leading carbon standards. Additionally, project developers can sell Forward Credit contracts on the investment platform, and auction ownership shares in their projects. Corporates, on the other hand, can already secure volumes and prices for carbon credits that are registered in the future.
goodcarbon collaborates with established players in the market and coordinates with ongoing governance efforts to increase integrity, efficiency, and transparency in voluntary carbon markets, through web3-based applications.
The goodcarbon platform, therefore, provides a convenient and compliant exchange of future carbon credits, in form of standardized financial assets that are subject to German financial regulation.
All projects listed on goodcarbon will be subject to a stringent verification process. The platform will work in collaboration with existing verification and standardization bodies such as Verra and Gold Standard, but will also apply its own impact assessment. This covers five dimensions: climate change mitigation, biodiversity enhancement, benefits for communities, climate change adaptation; pollution, and waste reduction. This will ensure that only the highest quality projects are hosted on the platform and get access to funding.
Today’s voluntary carbon market is mostly non-transparent and swamped with low-quality projects.
“In most cases, you don’t know what you are buying and whether it brings additional benefits with it, like protecting biodiversity or improving livelihoods. goodcarbon is about to change that. Building on decentralized ledger technology, their platform allows you to invest in specific projects in the most transparent way. They secure the quality of the credits, cut out intermediaries and establish a financing forward marketplace for such credits. That is a game-changer for the supply problem we currently see in the market.”
