CarbonPool closes $12m to underwrite the carbon credit markets

Carbon credit insurer CarbonPool secures $12 million to underwrite the carbon credit markets

• Seed capital to build the world’s first insurance company with a carbon credit balance sheet
• CarbonPool provides credit insurance with claims payments made in-kind, ensuring companies can guarantee the carbon credits that they buy actually materialize
• This insurance is the critical missing component that will unlock investments in carbon credit projects, a market which is currently facing low confidence due to the high perceived risks

ZURICH (29 January, 2024) – CarbonPool, set to be the world’s first insurance company with a carbon credit balance sheet, has closed a CHF 10.5 million ($12 million) funding round.

Founded by former Allianz executives Coenraad Vrolijk, Nandini Wilcke and Frederic Olbert, CarbonPool aims to accelerate investment in carbon credits, which are crucial to achieving net zero, by providing carbon credit insurance with claims payments made in-kind.

Almost half of the world’s top 2,000 companies have plans to hit net zero emissions by 2030, part of an accelerating effort to achieve the Paris Agreement’s goal of global net zero by 2050. Many of these companies, alongside thousands of others, depend on carbon credits to reach their net zero goals. But after considerable turbulence in carbon credit markets, credit integrity, proper risk underwriting and certainty of outcomes are critical to reassure investors, regulators, and other stakeholders that these promises represent real environmental gains.

“CarbonPool’s in-kind payments make it unique among insurers in not only offering protection to holders of carbon credits in cases of natural disaster or technology breakdown, but also in providing a guarantee that carbon credits live up to their promises, giving purchasers certainty and ensuring that they can meet their net zero goals,” said Coenraad Vrolijk, former regional CEO of Allianz Africa and CarbonPool’s co-founder and chief executive.

The funding round was co-led by Heartcore Capital and Vorwerk Ventures and included HCS Capital, Revent Ventures and former members of the management board of insurance giant, Allianz, Axel Theis and Christof Mascher.

“Insurance represents 5-10 percent of revenue of most mature markets, yet it has only just begun to touch carbon trading. This is a space that desperately needs the credibility that established financial controls like insurance can offer,” said Christian Jepsen, a founding partner at Heartcore.  “We are excited to be backing a world-class team of climate scientists, carbon specialists and most uniquely, insurance experts with a combined 60 years of experience in global underwriting. I’m confident they will bring much-needed professionalization to this sector.”

“CarbonPool’s offering gives buyers, developers and investors in carbon dioxide projects the confidence needed to invest at scale and build the carbon removal industry we need,” said Dr. Dominik Steinkühler, Partner at Vorwerk Ventures. “We have been consistently impressed by the expertise and the track record of the CarbonPool founders and we’re excited to back such an ambitious and purpose-driven team. Their innovative in-kind approach extends beyond typical business insurance, safeguarding Earth’s CO2 balance sheet.”

CarbonPool’s insurance license application is underway in Switzerland, and the company is already offering assessments and pre-underwriting agreements to clients including corporations, institutional investors, and carbon removal developers. It is also in conversation with government bodies, including the United Nations and the State of California, sharing perspectives on how insurance can solve some of the industry’s key challenges, such as securing the permanence of carbon removals from the atmosphere.

“We are very excited to invest in CarbonPool. As a VC with a deep focus on insurtech, we believe in the power of innovation to address the pressing challenges of our time, and CarbonPool’s commitment to mitigating climate-related risks aligns perfectly with our vision for the future of the insurance industry,” said Alex Horvitz, CEO of HCS Capital.

About CarbonPool

CarbonPool helps society reach net zero by providing in-kind insurance for failure to achieve net zero commitments due to shortfalls, reversals, business interruptions and natural catastrophes that either reduce the amount of carbon dioxide removals contracted for or unintentionally add carbon dioxide back into the atmosphere.

CarbonPool’s team of insurance leaders, climate scientists, weather modelers, geographers, and engineers assesses each risk to build bespoke risk models. The premiums collected from each client are invested, alongside CarbonPool’s own capital, into high quality carbon removal projects, to enable claims payments in-kind.

About Vorwerk Ventures

Vorwerk Ventures is an independent €150m Venture Capital Fund. We invest in founders with sustainable business models that have a positive impact. We define ourselves through a strong commitment towards consumer-facing digital businesses, but we also go beyond and invest in selected B2B companies that match our sector expertise. Learn more: https://vorwerkventures.com/

About HeartCore Capital

Heartcore Capital is an early stage venture capital fund founded in 2007 in Denmark, with offices in Copenhagen, Stockholm, Berlin and Paris. We are a multi-product fund with 5 early-stage funds, 2 growth opportunity funds and 1 web3 fund under management – our cumulative committed capital is approximately €770m. We are European by origin but global in outlook, our team spans nine nationalities and speaks ten languages. So far we have invested in over 100 founding teams from 13 countries. We have backed some of Europe’s biggest category-defining companies, such as Tink, Neo4j, Boozt, Seriously and TravelPerk.

About HCS Capital

HCS Capital is an investment fund in Insurtech, Fintech, and Cybersecurity founded in 2017 and based in Miami, with investments primarily in North America, Latin America, and Israel. The fund’s purpose is to assist technological startups in becoming scalable, sustainable companies with a societal impact. HCS Capital’s focus is not solely on investing but also on creating an ecosystem where portfolio startups can interact and receive financial, strategic, human, and technological support from the HCS Capital team.

About Revent Ventures

Revent is a €60m, early stage VC fund, investing first checks into mission driven founders across Europe. We are looking for step change technologies as well as financial & data infrastructure providers that build the required pipes for markets to inflect in the fields of climate, healthcare and economic empowerment. Learn more at: https://www.revent.vc/