CarbonFlow Raises Capital

California-based startup CarbonFlow has completed its first round of venture capital funding. At the moment it's unclear just how much the company has raised, but both Clean Pacific Ventures and OVP Venture Partners are now naming CarbonFlow as a portfolio company on their respective websites.

Clean Pacific Ventures primarily invests in cleantech projects, but OVP Venture Partners has a more diverse portfolio. While OVP has been known to invest in cleantech in the past, that's not the company's focus. CarbonFlow has also received seed money from Jane Capital, which handles investments in energy and environmental technology.

CarbonFlow developed the CarbonFlow Suite — a software package that helps manage carbon markets. It handles record keeping, as well as automatic validation and verification, and promotes credibility through transparency. The suite includes eRecord, which handles all details of a carbon credit project, reducing costs and risks. eRecord essentially provides an independent audit trail, which can protect all parties involved in carbon markets. The company also offers Carbon Step, an application which automatically handles verification, delivery and distribution of offset credits.

CarbonFlow's software product offerings are focused on solving two problems. First, the inefficiency of carbon markets; participants tend to have difficulties collaborating on projects as well as managing long-term work. Second, the software is meant to bring more transparency to carbon markets through improved records, validation and verification. CarbonFlow's software is designed to meet Kyoto standards for registration, verification, certification and monitoring.

If CarbonFlow's software can overcome the current hurdles facing carbon markets, it's likely that the cost to create a credit could drop significantly, making it far more worthwhile for the average business to trade credits. Current estimates place the total value of carbon markets at $30 billion a year.

CarbonFlow was founded by Neal Dikeman, partner at Jane Capital and a writer who has covered cleantech extensively, and Karla Bell, who has been responsible for green efforts at the Olympics since the Sydney games. CarbonFlow has also partnered with Norwegian firm DNV, which was one of the first companies that the UN accredited to verify emission reductions.

CarbonFlow has great potential. The company's product serves a much needed purpose — the streamlining of carbon markets — and looks likely to increase the ability of businesses to participate in carbon markets over the long run. In my opinion, both Clean Pacific Ventures and OVP Venture Partners have made an investment that could be very worthwhile.