Voluntary carbon market network Carbonplace announced today that it has raised $45 million from its consortium of founding banks, as it prepares to launch and scale its global carbon credit transaction platform.
The company also announced that it has become an independent entity, and appointed fintech executive Scott Eaton as its first CEO.
Based in London, Carbonplace was launched in July 2021 by a coalition of banks including CIBC, Brazil’s Itaú Unibanco, National Australia Bank, and Scotland-based NatWest Group, with UBS, Standard Chartered, BNP Paribas, BBVA and SMBC joining as founding banks in 2022. The platform connects buyers and sellers of carbon credits through their banks.
The funding comes as demand for carbon offset projects and related credits is expected to increase significantly over the next several years, as companies and businesses increasingly launch net zero ambitions, and turn to offsets as a bridge to their own absolute emissions reduction efforts, or to balance difficult to avoid emissions, while the market for carbon credits is challenged by problems including a lack of liquidity, and insufficient or inconsistent data to assess the effectiveness of the projects.
Robert Begbie, CEO, NatWest Markets:, said:
“Carbonplace creates an efficient and secure network for carbon credit transactions. According to McKinsey, global demand for voluntary carbon credits is likely to increase by a factor of 15 in the next seven years. To meet that demand, Carbonplace is delivering a reliable, secure and scalable technology that will form a crucial part of the infrastructure for carbon markets to drive climate action at scale.”
Carbonplace said that it will leverage the new investment to scale its platform and grow its team, expand its services to a wider base of financial institutions and accelerate partnerships with additional carbon market participants. The platform is expected to launch later this year.
Following the financing, each bank will share equal equity ownership in the new company.
Eaton joins Carbonplace after serving as CEO of fintech company Nivaura, which focuses on workflow automation for debt capital markets transactions and creating a distributed ledger solution for bond origination. Prior to joining Nivaura, he was CEO of London based fintech company Algomi, and has also served as COO at fixed income trading platform provider MarketAxess.
“With Carbonplace, we are transforming the way that carbon credits are bought, distributed, held and retired. I am excited to take this company to the next level of its evolution, and to help unlock its massive potential to drive significant economic and social value by opening the carbon markets up to the world.”