Ousted WeWork founder Adam Neumann is moving into crypto.
Flowcarbon, which counts Neumann and his wife Rebekah as co-founders, said Tuesday it has raised $70 million combined in venture funding, led by Andreessen Horowitz's crypto fund, and a token sale. The startup hopes to sell tokenized carbon credits on the blockchain.
Companies use the credits to offset greenhouse gas emissions. A16z projects the market for such credits could reach $50 billion by the end of the decade, citing data from McKinsey, but the voluntary markets used to track those credits currently are "fractured, opaque and gated," wrote Arianna Simpson, a general partner at the firm.
Flowcarbon sees the blockchain as the best way to connect buyers of credits with developers of projects that create the offsets, with a focus on nature-based carbon removal efforts, such as reforestation.
The investment includes $32 million in venture funding, with General Catalyst and Samsung Next joining the a16z in the round. The remaining $38 million comes through the sale of a token, according to Reuters, called the Goddess Nature Token, backed by a bundle of certified carbon credits issued over the last five years from nature-based projects. The tokens can be retired by holders to offset their emissions, traded or redeemed for underlying carbon credits to be sold off-chain.
Before the carbon credits are bundled, they are certified by groups such as the Climate Action Reserve and the American Carbon Registry, Reuters reported. Flowcarbon plans to soon sell similar tokens backed by credits.
The backing by a16z makes this a high-profile return to the startup world for Neumann, who was famously pushed out as chief executive of WeWork following its failed IPO attempt in 2019. But Flowcarbon is run by co-founders Dana Gibber and Caroline Klatt, as well as Chief Blockchain Officer Phil Fogel, with Adam and Rebekah Neumann "supportive to the operating team," a Flowcarbon spokesperson told Axios.