Jun 13, 2023 - Economy

Inclusive Capital leads launch of carbon software startup

Illustration of a ruler with smoke coming out of the top, like a smokestack.

Illustration: Allie Carl/Axios

Carbon software firm Climate Vault Solutions launched on Tuesday with a $9.4 million Series A round, led by Inclusive Capital Partners Foundation.

Why it matters: The launch comes as companies, organizations and governments move to monitor and manage carbon emissions to get in front of regulation and meet net-zero targets.

The big picture: Large companies with net-zero commitments have more than doubled over the past-two plus years. To monitor that, banks, insurers, private equity firms and investment managers are expected to spend $256 million on climate-tracking software by 2027.

Yes, but: The credibility of net-zero goals, and a company's ability to achieve them, is lagging.

  • That credibility gap has created an opportunity for startups and big tech companies to develop software and data tools to authenticate the process and help businesses reach their targets.
  • Microsoft, Salesforce, IBM and SAP have software for ESG planning.
  • Smaller startups like CarbonChain, nZero, Context Labs and Watershed are focused on developing different ways to collect and manage data around greenhouse gas emissions.

Details: Jason Grant, president and COO of Climate Vault Solutions, said the company's software uses data from government-regulated carbon markets instead of voluntary carbon markets. Voluntary carbon markets have been plagued by controversy and confusion.

  • “Our clients need to use something where they felt safe,” said Grant.
  • The startup is also planning to use the funding to double its headcount from 15 employees to 30.
  • Other investors in the round include King Philanthropies, Valor Siren Ventures and ThirdStream Partners.

What’s next: The company is looking to grow its services to 10 million metric tons of carbon mitigated by 2025, up from the almost 1 million metric tons of carbon they've mitigated so far.

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