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FigBytes raises $14.5M to take bite of the ESG software market

Megan Hernbroth
Illustration of a keyboard key with a globe on top.

Illustration: Allie Carl/Axios

FigBytes, an ESG software company, raised $10 million in convertible notes plus an additional $4.5 million in venture debt, the company exclusively tells Axios.

Why it matters: FigBytes counts other environmental factors beyond carbon emissions in its definition of ESG, potentially providing an edge in the crowded ESG software space.

Details: Existing investor and board member Quantum Energy Partners provided capital for the $10 million SAFE note, which includes a cap that FigBytes CEO Ted Dhillon says is "significantly higher" than the company's Series A valuation. Dhillon declined to share what the cap or valuation was.

  • Silicon Valley Bank provided the $4.5 million in venture debt, which closed in October to extend the company's runway well into 2024, Dhillon says. He wanted extra assurance the company would not have to raise its Series B in the current funding environment, he says.
  • The Canada-based company also received $3.5 million in non-dilutive capital via a Canadian government grant.

How it works: FigBytes makes software that offers ESG data aggregation, analysis and recommended next steps, which it sells to companies like Akamai, Ford and Herbalife, and it also works with the state of Minnesota.

  • The software tracks different environmental factors, including water use, that Dhillon says other competitors leave off in favor of focusing solely on carbon emissions.
  • The company also offers a public-facing content management system for customers to track and share real-time progress on ESG and sustainability goals.

Zoom out: Water is an often-overlooked potential risk when it comes to the current cohort of ESG measurement and analysis tools.

  • Yet it is a crucial component of manufacturing, data center operations and agriculture production, among other industries.
  • Dhillon says incorporating water risk is critical to providing a more comprehensive calculation of a company's overall climate-related risk as opposed to only looking at emissions.
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