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Investors continue to back startups plotting to build machines that capture carbon dioxide from the air.

Why it matters: Scientists argue that carbon removal tech will be necessary to curtail the worst of climate change, and dozens of direct air capture (DAC) companies have emerged to meet that need.

Driving the news: Startup 280 Earth, which was spun out of Google's Moonshot Factory X, has closed a $50 million Series B round.

Investors in the company, based in Mountain View, California, include Builders VC, Alphabet, and former Facebook CTO Gideon Yu.

CEO John Pimentel told Axios that 280 will use the funds to operate and conduct R&D with its first 500-ton removal facility in The Dalles, Oregon. That plant is already built and operating.

280 Earth plans to build a 5,000-ton removal facility by 2025, and Pimentel said that the company aims to raise a Series C round to get that second plant up and running.

The big picture: The oil sector has grown increasingly interested in DAC tech as a way to remove the emissions associated with fossil fuels and as a way to develop the market for carbon.

The U.S. government is also supporting direct air capture through its DAC hubs program and potentially as a customer.

There's also growing momentum for large corporates, like Microsoft, to buy carbon removal credits from these types of removal projects. Tech companies with a growing data center footprint are particularly interested in DAC.

Yes, but: DAC is still in a relatively early stage of deployment and is generally too expensive.

Investors are hoping DAC machines will follow the cost curve of other climate technologies, like solar panels and wind turbines, that become a lot cheaper as the tech is produced and deployed in larger volumes.

State of play: 280 Earth is the latest DAC startup to raise funds on the road to commercialization.

On Friday, Spiritus announced a deal with Saudi Arabia oil giant Aramco, to potentially build Spiritus' DAC machines in the kingdom. Aramco's VC arm, Aramco Ventures, also has made an equity investment in the startup.

In March, CarbonCapture said it had closed a Series A round of $80 million from investors including Prime Movers Lab, Aramco Ventures, Amazon's Climate Pledge Fund, Siemens Financial Services, Idealab X, and TimeVentures.

Last year, Occidental acquired direct air capture startup Carbon Engineering for $1.1 billion, kicking off a wave of interest and strong valuations in the sector.

Investors back DAC startups on road to commercialization

New companies eyeing commercialization keep pulling in big money.

A DAC facility in The Dalles, Oregon, built and operated by startup 280 Earth.

A facility that houses direct air capture machines built by startup 280 Earth in The Dalles, Ore. Photo: Courtesy of 280 Earth

Climate tech

Investors continue to back startups plotting to build machines that capture carbon dioxide from the air.Why it matters: Scientists argue that carbon removal tech will be necessary to curtail the worst of climate change, and dozens of direct air capture (DAC) companies have emerged to meet that need.

Investors back DAC startups on road to commercialization

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