Controversial WeWork founders back with crypto solution for climate change
Husband and wife duo Adam and Rebekah Neumann launch "Web3-climate venture" Flowcarbon in the hopes of scaling climate change solutions.
Flowcarbon, which describes itself as “a pioneering climate technology company working to build market infrastructure in the voluntary carbon market (VCM),” has announced a $70 million capital raise.
The raise consisted of venture capital funding and token sale proceeds, led by Silicone Valley VC firm Andreesen Horowitz (a16z).
“The funding round was led by a16z crypto and also includes General Catalyst, Samsung Next, Invesco Private Capital, 166 2nd, Sam and Ashley Levinson, Kevin Turen, RSE Ventures, and Allegory Labs. Other participants in the token sale include Fifth Wall, Box Group, and the Celo Foundation.”
Flowcarbon founders Adam and Rebekah Neumann were also behind flexible workspace company WeWork, which became marred in controversy after filing for an Initial Public Offering (IPO) in August 2019.
The firm’s pre-IPO market valuation came in at $47 billion. But soon after filing, the company’s valuation fell dramatically to $7 billion, triggering the dismissal of thousands of employees.
This controversy left a bitter sting for those who were let go, more so considering Neumann pocketed $1.05 billion from the deal.
In what Tech Crunch calls Neumann’s “redemption story,” the duo is back, and this time they are targeting carbon credits.
How will Flowcarbon use crypto technology to fight climate change?
Flowcarbon aims to tokenize carbon credits, enabling companies to buy and sell them in the hopes of reducing the global carbon footprint.
Carbon-negative firms can sell tokenized credits and benefit from more efficient cash flow. There’s also the benefit of paying a 2% tokenization fee, far less than the 30% charged through traditional channels.
Meanwhile, buyers experience greater transparency in the carbon offsetting process.
The CEO of Flowcarbon, Dana Gibber, called the VCM a “brilliant financial mechanism” to offset the environmental damage caused by carbon emissions.
“There are powerful economic incentives to destroy and degrade critical natural landscapes around the world, but the voluntary carbon market is a brilliant financial mechanism that creates a counterbalancing incentive to reforest, revitalize and protect nature.”
The public pre-sale of “Goddess Nature Tokens” (GNT) takes place on Friday, May 27.
What are carbon credits?
Carbon credits enable the holder to emit a certain amount of carbon dioxide gas in their business activities.
In theory, this makes companies more carbon aware, allowing them to take measures to reduce emissions over time as limits get reduced. Companies that do not use their allocation of carbon credits can sell them to others.
The cost of buying credits by net-positive emitters is a further incentive to cut emissions. However, the scheme is not without its critics. Friends of the Earth (FotE) called carbon credits a dangerous distraction that worsens the problem.
The organization argues that an offsetting system is a “convenient excuse for governments, businesses, and individuals” to avoid making difficult decisions. The only credible solution is the immediate end of fossil fuel use.