Climate startup Supercritical nabbed $13 million to help carbon removal projects get funded. Check out the 11-slide pitch deck it used to secure the funds from Lightspeed.

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  • Carbon removal needs to scale rapidly if humanity is to limit global warming.
  • London-based startup Supercritical just raised $13 million to help projects get funded via companies.
  • Check out the 11-slide pitch deck it used to raise the Series A round led by Lightspeed Venture Partners.

London-based startup Supercritical has just raised $13 million from Lightspeed Venture Partners to help the “groundswell” of businesses pledging to invest in carbon removal. 

Even with aggressive decarbonization plans, which involves reducing emissions, historic emissions will linger in the atmosphere. That’s where carbon removal — tree-planting, sucking CO2 from the air using technology, or enhanced rock weathering — comes in. 

“If we reduce all of our emissions, switch to renewables, electric vehicles, we still need to remove this much carbon because we’ve just left it for too long,” said Michelle You, the CEO of Supercritical, which helps companies invest in carbon-removal projects. 

“We are here to help the carbon-removal industry scale by working with businesses who want to get to net zero, because the only way that you can get to net zero as a company is by decarbonizing and removing your residual emissions with permanent carbon removal.”

The UN’s IPCC climate panel has recognized the role carbon dioxide removal plays in meeting the Paris Agreement’s goal of limiting global warming to 1.5 degrees. Scientists found an annual 10 gigatons of CO2 needs to be drawn down from the atmosphere by 2050. In 2022, around 600,000 tonnes of carbon dioxide removals were purchased – less than 0.01% of the 2050 goal. 

It’s a massive and urgent scaling challenge, one that makes the case for investing in carbon removal in parallel to rapid decarbonization, You, who previously cofounded music startup Songkick, added. You cofounded Supercritical with Songkick’s former chief technology officer Aaron Randall in 2021.

“The way this sector has to scale is by ambitious buyers committing to offtake agreements,” You continued, something Supercritical brokers.

Offtake agreements are essentially long-term contracts committing to the purchase of credits. Supercritical recently brokered its first agreement between a customer and biochar startup Carbo Culture. 

“That enabled Carbo Culture to go to its bank and get the project financing to build a facility. In that way, we’re enabling truly additional capacity to be built and unlocked, and that is incredibly exciting for us,” she added.

The company will use the Series A financing to turn its offtake services into a product, and make it easy for others to commit to long-term carbon removal. “That’s how renewables scaled back in the mid 2010s, with power purchase agreements. We’ve taken inspiration from them,” You said. 

It’s the same method used by Frontier Fund, a $1 billion commitment for carbon removal from big tech companies including Alphabet, Meta and Stripe. 

Supercritical also offers carbon credits that have already been generated, as well as carbon accounting services and decarbonization plans for its customers. It also helps them set up carbon removal budgets. 

The cash injection, with participation from RTP Global, Greencode Ventures, MMC Ventures, brings the company’s total raised to $15.5 million. Supercritical set out to create a gender-balanced cap table in its seed round and maintained it during the Series A. 

The company will use the fresh funds to expand its scope. Currently focused on asset-light tech businesses, it wants to broaden into other sectors, which includes designing new products to suit more complex supply chains. 

Long term, it wants to be the “no brainer” option for carbon removal purchases. Supercritical is already responsible for 35% of permanent corporate carbon removal purchases and counts two of the world’s top 20 buyers among its customers, according to You, who pointed to the purchase tracker The CEO noted that there is some lag in the data. 

Check out the 11-slide redacted pitch deck Supercritical used to raise the funds.

Read the full article here

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