As a researcher with years of experience following the tech and startup scene, I must admit that I find the situation with Adam Neumann’s Flowcarbon rather intriguing, though not entirely surprising. The story of a much-hyped project failing to launch is all too familiar in this dynamic world.
Reportedly, the climate technology company founded by former WeWork CEO Adam Neumann, Flowcarbon, is said to be returning investments to its backers due to the delayed or failed launch of its highly anticipated Goddess Nature Token (GNT).
Based on a Forbes article published this week, it appears the company has encountered difficulties in achieving their goal of converting carbon credits into digital tokens.
Project Raised $38M From Token Sales
In the year 2022, Flowcarbon garnered an initial investment of $70 million, with notable investors such as Andreessen Horowitz taking part in the project. The Series A funding round also saw participation from General Catalyst and Samsung Next, along with high-profile Hollywood producers Sam and Ashley Levinson.
Approximately $38 million from the funds we’ve gathered was generated by GNT sales; however, it’s yet to be determined if this amount encompasses purchases made by retail consumers as well.
The idea was to create a token backed by carbon credits, which represent one metric ton of carbon dioxide either removed or prevented from entering the atmosphere. The cryptocu would have been traded on the Celo blockchain, which itself had bought $10 million worth of GNT to set off its own emissions.
In my recent analysis, I’ve discovered that the startup has been refunding investments due to prolonged delays in executing its original plans. They attribute these circumstances to challenging market conditions and resistance from carbon registry entities.
The Forbes article mentions that investors were obligated to agree to a document, effectively absolving the enterprise of any potential claims and imposing confidentiality conditions upon them.
Flowcarbon Blames Woes on Banning of Tokenization
According to queries made by Forbes, the project admitted to initiating refunds over the past year. Yet, rather than disclosing this information publicly, it opted for maintaining confidential correspondence with its investors regarding these matters.
According to a recent report, Flowcarbon encountered the same challenges as numerous other crypto-based carbon projects that have preceded it. For example, in 2021, both Toucan and KlimaDAO tokenized vast amounts of retired carbon credits, leading to worries about potential double counting from registries.
Following this, one of the biggest global organizations for greenhouse gas credit, Verra, prohibited the tokenization of expired credits the next year. This move proved challenging for Flowcarbon’s plans to generate tokens, causing dissatisfaction among their investors.
It’s worth noting that, even with ongoing refunds, the startup continues to operate as usual. Their recent social media update has announced a CarbonSmart summit taking place on September 23rd. The main focus for this event seems to revolve around the topic of carbon financing.
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2024-09-16 07:52