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Wise co-founder’s VC fund backs Arbonics’ €5.5M round to fight climate change

Arbonics founders
Picture credits: Arbonics

Estonian startups raised €147.3 million in the first three quarters of 2023, engaging in over 40 investment deals, claims Startup Estonia. The largest investments this year were raised by Funderbeam, Planet42, and Efenco

Adding to this impressive lineup of investments is Arbonics, a climate tech startup. Touted to be building the highest-quality, scalable forest carbon removal platform in Europe, Arbonics has closed €5.5 million seed investment from NordicNinja known for its investments in Einride and Bolt, Plural, and Tilia Impact Ventures. 

This follows the €1.8 million pre-seed funding it secured last year. With this, the total funding raised by Arbonics accounts for €7.3 million. The Estonian startup will use the fresh funds to meet the growing demand for quality carbon removal. It will further develop its product portfolio to cover the entire forestry lifecycle, grow its team, and expand to cover 50% of European forests next year. 

The funding will also see Arbonics add further layers of impact assessments for biodiversity, triple its team, and work with leading scientists with the launch of a scientific advisory board.

What challenge does it solve?

Carbon removal is a globally acknowledged challenge and forests play a central role in its efficacy. Research indicates that nature-based solutions could contribute up to 30% of the required global carbon mitigation and forests are expected to contribute as much as 80%. 

Nature, on its own, currently eliminates nearly 2 gigatonnes of CO2 annually through the growth of forests, the restoration of wetlands, and the maintenance of healthy soils. This capacity could potentially increase to as much as 10 gigatonnes per year by 2050, which is equivalent to the total emissions from the entire global transport sector.

However, realising this potential hinges on a fundamental shift in how we manage our forests. This is where the Arbonics platform comes into the picture. 

Calculates the carbon removal potential of land

Founded by Kristjan Lepik and Lisett Luik in early 2022, Arbonics enables nature-based solutions to fight climate change, focusing particularly on forestry. Arbonics makes it simple for landowners to check how much carbon their land can soak up. The platform quickly analyses the carbon potential of an area of land or forest, using lots of data sources and the team’s forest know-how. It works fast, taking less than a minute. 

Arbonics looks at unused land and offers a tailored solution for existing forests, earning carbon credits through smart forest management. By changing how landowners figure out their carbon storage potential, Arbonics helps forests and landowners make more money. It also improves the voluntary carbon market.

With this tool, landowners earn extra money and provide reliable, high-quality carbon credits that are certified by top verification providers like Verra for the voluntary carbon market.

The tool is already fully developed and in use for afforestation in the Baltics and Finland. The data-based approach will be scaled out to cover existing forests. It is also witnessing increased demand from landowners in Europe and beyond. 

Arbonics CEO Kristjan Lepik said: “With this recent funding we’re poised to make a significant impact, not just as a business but as a catalyst for meaningful change. This year has been tough on the carbon markets, and with concerns around the Voluntary Carbon Market but it’s exactly what it needed to mature. It proved just how important it is for the market to be more transparent and proven for forest carbon projects, and at Arbonics, that’s what we’re building. Our tech stack is designed to elevate the nature-based removals industry, setting a new standard for what can be achieved when forests and technology work in harmony. With the support of our latest investors, we can continue building what we consider to be the future of transparent carbon removal.”

Taavet Hinrikus, Partner at Plural said: “While many new projects are being started on the technological carbon removal, those solutions take time. A luxury we do not have. If we take technologies and empower nature with them, in the way that Arbonics does, scalable solutions can happen already this decade.”

Rainer Sternfeld, Managing Partner at NordicNinja said: “Arbonics is exactly the kind of innovative, scalable, and sustainable solution we look for at NordicNinja. The company not only has the technology and market understanding but also the vision and the team to make a significant difference. We see Arbonics as having the potential to conquer the market in this crucial sector. That’s why we’ve made this strong bet on their, and our planet’s future.”

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