The carbon market is booming, but it’s got a big trust problem – Goodcarbon is out to change that while shifting millions into restoring nature.
Regenerating and rewilding nature is a ‘super solution’ to climate change. It can be done here and now with no technological, infrastructural or political barriers to adoption and it has potential to remove nearly 1/3 of all carbon emissions.
The booming carbon market can provide the funds needed to rejuvenate the earth, but it’s got a big trust problem – Goodcarbon is out to change that while shifting millions into restoring nature.
“The logic is to sell more, to sell more, to sell more – but questions come with that – is this really sustainable?” After 8 years in the e-commerce fashion business, Jerome Cochet, Co-founder of Goodcarbon, was plagued by questions.
When the opportunity emerged to make the leap into the path less travelled of green techpreneurship, he lept. “I have kids so I care about what happens after me and that had a big influence on my decision to dedicate my career to making the world more sustainable…we can’t solve the climate crisis without regenerating nature,” says Jerome.
Jerome had been talking to David Diallo – a long-time sustainability entrepreneur – they’d been friends since they first met at university 20 years ago. David’s passion for protecting nature had led him to co-found the Oceans2050 Foundation that explores and amplifies solutions for ocean regeneration.
“The insight Oceans2050 gave us was that the ocean can act as a massive carbon sink, and that led to us rethinking how the voluntary carbon market could be used to not just decarbonise the atmosphere, but to recarbonise the biosphere,” says Jerome. “We are very complimentary in our skillset. I have managerial experience, he has entrepreneurial experience, so it made sense to go into business.”
They explored ways to merge Jerome’s platform-building expertise with David’s Oceans2050 experience: “we looked at how we can apply impact-thinking and platform-thinking and bring this to the emerging voluntary carbon market.”
There’s huge demand flowing into the voluntary carbon market, driven by a push from both regulatory requirements and conscious consumers. Traded global markets for CO2 permits grew by an incredible 164% last year to reach $851 billion. Europe is now the global hotbed for the carbon market, after the EU’s 2005 Emissions Trading System created the world’s most established CO2 market. At 683 billion Euros, Europe accounts for 90% of the global carbon market value.
But a lack of quality and transparency has led to the market being slated for greenwashing: “we looked at the problems of the carbon market and looked at where in the value chain we can make a difference,” says Jerome. They launched Goodcarbon to “tackle the problem at the root cause, which is the shortage of high-quality supply of carbon credits.”
The German startup has since raised $5 million in a 2022 pre-seed round led by Planet A Ventures and grown into a 34-strong team that channels funds into nature regeneration in the global South.
What change are you bringing to the carbon market?
- We elevate the quality with our own framework. We apply our own standards and framework to the carbon market since existing standards aren’t fully able to differentiate good from bad carbon.
- We enable companies to buy not only existing carbon credits from nature-based solutions, but most importantly, future carbon credits. They can buy carbon credits for the next 20 years and hedge carbon credits within a market of rising prices and shortages of high-quality supply.
- All our projects sequester carbon, restore biodiversity, and have a social impact.We redistribute 75% of income from carbon streams into local communities; it’s important the local population benefits from each project – that’s the key to ensuring it lasts for a long time.
- We are very careful to not enable greenwashing. We only work with companies who first avoid, reduce and minimise their carbon emissions, before they compensate and offset.
What’s your route to market?
What were the early challenges you faced in getting set up?
Any entrepreneur has to show a lot of dedication – it’s always a marathon, not a sprint. We’re in it for the long run, and you have to show resilience.
This is not about buying from a central supplier, this is about pushing capital from the global North into the global South, the projects are often in Asia and Africa, so it’s complex. We’re dealing with nature, which poses the risk of mismanagement, there are all sorts of risks which emerge. It’s a complex product and you have to get a good foothold, both from the demand side and from the supply side.
You have to build a reputation on the supply side and on the demand side so that companies want to work with you. It’s something which is not easy and it took a lot of energy and a very good team and time.
What are 3 surprising facts about the carbon market?
- 30% of the carbon emissions we need to reduce can come from nature-based solutions.
- 50% of our prosperity and GDP depends on nature and at the same time, it’s one of the most important levers which we have locally to tackle the climate crisis.
- 10 billion tons of carbon reductions can come from nature by 2030, but we need to close the finance gap. That’s the call for capital.
What was a key turning point in setting up Goodcarbon?
Like any company, success is determined by the offer you make for your clients. If you have nothing to sell, they have nothing to buy.
A turning point for us was the early success we had in securing the highest quality projects from around the world and bringing them onto the platform. From reforestation in Latin America to Mangrove projects in India, and regenerative agriculture projects in Asia. To win these projects over we needed a quality proposition, we call it a ‘quality and transparency framework.’
What are 3 tips you can share with other green techpreneurs?
I’m a big fan of that word, because it applies especially to entrepreneurship. There will be tough times and easier times, but there will always be challenges and the unexpected that you have to fight through day to day as they pop up. It’s the greater purpose that matters for us, we want to shift millions into nature.
Have the mindset that it’s a marathon, not a sprint
Be in it for the long run
This is a market that will only work if players collaborate more than in other markets. Have an openness to exchange with potential competitors or collaborators, connecting with a network in your space is crucially important.
I’d like to make a call out for partnerships – we are very open to partnerships of various dimensions.
What’s your mantra or life philosophy?
I’m an optimist by nature – that’s my mantra – ‘in the end, things will be alright.’ That’s how I look at life.
What keeps you grounded?
Exercise, my family and kids, and walking to work – it gives me time to reset. I love to spend my vacation in a camping van with my family, it’s the closest you can get to nature.
Do you have a role model who has been highly influential?
My parents, both in how they integrated work-life balance, but also the work ethic they gave me – doing things properly.
If you could teleport yourself into your future and be anywhere, doing anything, where would you be and why?
In 10 years time, we want to have financed 1 billion tons of carbon emission reductions, and we want to be a role model to encourage others to follow suit.
…..I would be in the mountains – it’s a fantastic place to be – I love it for the atmosphere.
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