London-based carbon credit ratings startup BeZero Carbon announced today that it has raised $50 million in a Series B funding round, with proceeds aimed at expanding its initiatives to provide transparency in environmental markets.

The financing marks the largest capital raise in the UK this year, and brings the total raised by BeZero Carbon to more than $70 million in the past year.

The deal comes as demand for carbon offset projects that counteract the release of greenhouse gases, and related credits is expected to increase significantly over the next several years, with companies and businesses increasingly launch net zero ambitions, and turning to offsets as a bridge to their own absolute emissions reduction efforts, or to balance difficult to avoid emissions.

The market for carbon credits, however, is challenged by problems including a lack of liquidity, and insufficient or inconsistent data to assess the effectiveness of the projects.

Tommy Ricketts, CEO and co-founder of BeZero Carbon, said: 

“We have a once in a generation opportunity to build environmental and ecological restoration into the heart of the economic model. Starting with carbon, effective ecosystem markets have huge potential to accelerate the Net Zero transition and generate economic prosperity. Developing the information infrastructure that allows these markets to take off is fundamental to their growth. The raise will ensure we can continue to invest in our ratings, risk and analytics tools to make this vision a reality.”

Founded in 2020, BeZero is a ratings agency for carbon markets, providing carbon ratings, research and data products, backed by a team of climate scientists, earth observation specialists, data scientists and financial analysts.

According to the company, the funding will be used to drive innovation in environmental markets through the development of ratings, risk and analytics tools, enabling BeZero to invest in creating risk-based products for other ecosystem markets, and open offices in New York and Singapore. The company also aims to expand its proprietary automation toolkit, deepen its earth observation capabilities, and invest in talent.

Sebastien Cross, Chief Innovation Officer and co-founder of BeZero Carbon, said: 

“We are grateful to our investors, clients and partners who have recognised that the team and tools we have built at BeZero Carbon will transform the Voluntary Carbon Market. We are thrilled to continue our expansion with offices in the US and Asia, delivering world-leading insight and analysis that powers global environmental markets.”

The funding round was led by US investment firm Quantum Energy Partners, and included participation from strategic investors EDF Group Hitachi Ventures and Intercontinental Exchange (ICE), as well as existing investors Molten Ventures, Norrsken VC, Illuminate Financial, Qima and Contrarian Ventures.

Jeffrey Harris, Venture Partner at Quantum Energy Partners, said:

“Set to reach $50bn by 2030, the Voluntary Carbon Market will play a central role in the transition to Net Zero. BeZero Carbon has built the biggest ratings agency in the market, with an incredible team of experts that are leaders in their fields. We are excited to be supporting them with their next stage of growth to help build a new climate economy.”