CarbonPool raises $12M in climate seed funding

CarbonPool, an insurance start-up founded by three ex-Allianz executives, recently closed the largest climate-focused seed funding round in Europe in over a year, raising 10.5 million Swiss francs ($12.17 million), according to Reuters.

Heartcore Capital and Vorwerk Ventures led the round, which is the second-largest globally since 2023, with HCS Capital, Revent Ventures, and former Allianz board members Axel Theis and Christof Masher also participating.

CarbonPool ensures that companies get the carbon credits they buy, even if the issuer failed to deliver them, such as when wildfires destroy the backing forest.

The company plans to achieve this by purchasing and holding high-quality carbon credits, which it will distribute as needed.

Nandini Wilcke, CarbonPool’s co-founder and COO, stated that the uncertainty of permit delivery is stalling market growth, mentioning that buyers currently have no assurance that the offsets they pre-purchase will materialise as expected, which they need to report in their financial disclosures.

AlliedOffsets data with Reuters showing that from 2000 to 2023, only 45 per cent of carbon permits were successfully issued.

If companies don’t secure the expected credits, they may not meet their climate goals. Although companies can insure the assets backing their carbon permits, no one currently covers the carbon credit’s value.