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Exclusive: Kairos raises $52M for methane detection, led by BlackRock

an illustration of a methane molecule being enlarged by a magnifying glass

Illustration: Tiffany Herring/Axios

Methane leak detection startup Kairos Aerospace has raised $52 million as it expands globally and tests new tech.

Why it matters: Methane is a potent greenhouse gas, but sniffing out leaks of the dangerous, odorless, and colorless gas has proved a challenge.

BlackRock led the round.

Catch up fast: Oil and gas companies often use ground sensors, special cameras, and low-level flights to pick up methane leaks. But those methods are inefficient or expensive.

  • There are services that use satellites to detect leaks, but those tend to see only the biggest plumes.

What's happening: Kairos Aerospace strikes a middle ground: it uses aircraft equipped with gas-detecting spectrometers to fly frequent, higher-altitude sweeps over entire oil- and gas-producing regions.

  • The startup says the approach balances efficiency and sensitivity, enabling it to quickly spot leaks that would otherwise be missed or go unnoticed for weeks or longer.

State of play: Kairos began raising its Series D last spring, as the Biden administration indicated it would move ahead on rules instituting new penalties for methane leaks from oil and gas infrastructure.

The latest: Kairos held an initial close of the round last week.

  • Hartree Partners and existing investors DCVC, Climate Investment and Energy Innovation Capital participated.
  • Kairos refers to the raise as a "first close," because it's considering another $5 million to $15 million investment, CEO Gregg Rotenberg tells Axios.

What they're saying. "We're having internal debate at the board level, given the level of demand-uptick in the first six weeks of 2024," Rotenberg says. "The market seems to have opened up, perhaps more than we expected."

Of note: Kairos can achieve profitability with the $52 million it raised, he adds.

Between the lines: BlackRock's decision to lead the Kairos raise underscores its funds' potential exposure to the Biden administration's new methane leak rules, which will take effect Jan. 1.

  • "They likely have positions in almost all of our customers or potential customers," Zack Bogue, managing partner of Kairos investor DCVC, says.

What's next: Kairos this spring expects to test a laser device that it would use with its spectrometer. The startup also plans to rebrand as Insight M later this quarter.

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