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Supercritical raises $13M for carbon removal market

Illustration of a vacuum sucking up CO2 molecules from the air.

Illustration: Allie Carl/Axios

Supercritical, a startup building a carbon removal marketplace, has raised a $13 million series A led by Lightspeed Venture Partners.

Why it matters: Companies are increasingly setting net zero goals but are becoming wary of using carbon offsets as a way to hit their targets.

Details: RTP Global, Greencode Ventures, and MMC Ventures joined the round.

How it works: London-based Supercritical works with corporate partners — mostly U.K. tech firms today — and aggregates their demand to buy offsets from carbon removal projects.

  • Carbon removal is a broad sector and includes diverse methods like installing direct air capture machines, or producing a biochar that captures carbon dioxide.
  • Supercritical also uses carbon accounting software to help its customers track and manage their emissions.
  • The startup says it has a team of scientists that vet all the projects it includes in its marketplace.
  • Supercritical plans to use the funding to hire and expand the team and bring in customers beyond the tech sector.

Zoom in: Scientists caution that to prevent the worst effects of climate change, the world needs to remove carbon from the atmosphere, not just halt global carbon emissions.

  • Voluntary carbon offsets have been plagued with controversy, and many companies are looking for alternatives to help achieve challenging net zero goals.
  • Carbon removal offsets have come into fashion as a more authentic way to reach reduction targets, and companies like Stripe have led the way by pledging large investments into carbon removal projects.

The big picture: Carbon removal technologies are at an early stage and some like direct air capture have yet to be proved at scale.

  • Many of the projects that remove carbon from the atmosphere are expensive, costing far more than $100 per ton.
  • Supercritical has found some traction in the tech sector because profit margins can be high enough to afford the premium cost of carbon removal.
  • To move beyond tech buyers, carbon removal projects need to grow in scale and come down in costs.

Of note: The co-founder and CEO, Michelle You, previously founded SongKick, which sold most of its assets to Warner Music Group several years ago.

  • She found climate religion while backpacking around the world and reading the Patagonia founder's book on environmentalism and business.
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