Adam Neumann’s Tokenized Carbon Credit Startup Raises $70M From a16z and Other VC Giants

The Israeli-American businessman and investor started the firm with his spouse Rebekah and CEO Dana Gibber. On May 24, the company announced that it had raised $70 million in its first major funding round led by a16z. The event was made through a combination of traditional venture equity and a private token sale.

Participants included General Catalyst, Samsung Next, Invesco Private Capital, RSE Ventures, Allegory Labs, and the Celo Foundation, according to the announcement.

The startup aims to help companies reduce their carbon footprints by selling tokenized carbon credits on the blockchain. According to the firm, these tokens will then be tradable on major crypto exchanges.

Decarbonizing Through Crypto

Companies can buy carbon credits to offset their emissions and environmental impact. These credits are channeled into other projects that reduce or remove carbon from the atmosphere.

Flowcarbon aims to tap into this growing demand for carbon credits as the world becomes more conscious of emissions and corporations are pressured to do something about them.

These credits will be certified digital assets stored and traded on the blockchain. Additionally, this method facilitates cheaper funding for firms and projects to scale faster. Chief executive Dana Gibber explained:

“Our mission is to provide the financing necessary to scale projects that reduce or remove carbon from the atmosphere, in particular nature-based projects.”

She added that the voluntary carbon market is a “brilliant financial mechanism” that creates a counterbalancing incentive to reforest, revitalize, and protect nature. Arianna Simpson, General Partner at a16z, commented:

“The carbon market is extremely opaque, and we believe demand for offsets is rapidly outpacing the speed at which supply can be increased, especially for nature-based projects,”

She added that the carbon credit market could potentially grow to $50 billion by 2030. Last week, Ripple pledged $100 million to invest in carbon markets in its latest sustainability drive.

GNT Token Sale

Almost half of the funding, $32 million, came from a16z, which is extremely bullish on Web3, and other VC firms, while the remaining $38 million came from the closed-door sale of Flowcarbon’s Goddess Nature Token (GNT). The asset is based on the Celo network, an EVM compatible proof-of-stake layer-1 protocol.

GNT is backed by carbon credits which are pre-certified by industry groups including Verra, Gold Standard, Climate Action Reserve, and the American Carbon Registry, according to Reuters.

The tokens will be sold in bundles that improve liquidity and allow more significant volumes to be traded than in traditional ways such as OTC (over-the-counter).

Featured Image Courtesy of Commercial Observer