As many firms struggle to meet their emissions targets, Toronto-based Carbon Neutral Club has raised $1.4 million CAD in seed capital to mine what the startup views as a largely “untapped resource” for corporate climate pledges.
“We’ve come to realize that in order for organizations’ climate plans to be successful, they must engage the people who are responsible for delivering upon them: employees,” Carbon Neutral Club co-founder Jeff Packer told BetaKit.
“We want to shepherd in a new era of climate plan implementation.”
– Jack Bruner, Carbon Neutral Club
Though companies have historically neglected to consider employee engagement in their climate plans, emissions from employee activities like flights and commutes often represent a significant portion of corporate climate impact. Carbon Neutral Club aims to rectify this with its platform, which incentivizes workers to help companies meet environmental targets.
To date, Carbon Neutral Club has grown to serve hundreds of clients across North America, from multinational food giant Kraft Heinz, to sustainable apparel brands like Toronto’s Kotn and Vancouver-based TenTree, and fellow Toronto cleantech firm Manifest Climate.
Armed with $1.4 million in fresh funding, Carbon Neutral Club plans to build on that growth by expanding globally and accelerating its product roadmap, at a time when experts say it is imperative to act in order to avoid irrevocable environmental damage. To support its expansion plans, Carbon Neutral Club plans to double the size of its 12-person team over the next year with hires in growth, product, and engineering roles.
Carbon Neutral Club’s growth strategy is two-pronged. The company sees room to grow with the help of individuals who sign up for Carbon Neutral Club’s platform and champion it internally within their organizations. The startup is also partnering with other corporate sustainability ecosystem players, from carbon accounting platforms and credit providers to climate strategy consulting firms, to broaden its reach.
Carbon Neutral Club’s seed round, which closed in October 2022, was led by a pair of cleantech investors in Vancouver-based Emend Vision Fund and Montréal’s Blue Vision Capital, and Markham-based Good News Ventures. Raised via simple agreement for future equity (SAFE), this round saw support from undisclosed strategic angel investors, and brings Carbon Neutral Club’s total funding to about $1.7 million.
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Founded in 2021 by Packer, Roee Eidan, and Jack Bruner—a trio of tech workers with past experience working at firms like Konrad Group and TWG—Carbon Neutral Club gives employees tools, education, and incentives to reduce their environmental footprint.
“We want to shepherd in a new era of climate plan implementation, one that embeds climate action directly into the values of a company,” said Bruner in a statement.
Carbon Neutral Club’s Sustainable Behaviours Platform allows workers to calculate their carbon footprint at home and at work, integrating into Slack and Teams. It delivers educational content and behaviour change opportunities towards the goal of incrementally reducing individual and company-wide climate impact.
According to Packer, Carbon Neutral Club’s platform is capable of serving organizations of any size, which he said sets the startup apart from other similar players that target SMBs or large enterprises. The co-founder also views the brand incentives Carbon Neutral Club offers, which include savings at over 75 sustainable brands, as a differentiator within the space.
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At its launch in mid-2021, Carbon Neutral Club raised a $250,000 pre-seed round from a group of undisclosed angel investors, including some other Canadian climate tech entrepreneurs. Later that year, the company won second place in the New Energy Nexus Cards and Payments Challenge, taking home another $50,000.
“While the climate culture space is in its infancy, it will be the bedrock of all successful corporate climate strategies going forward,” said Emend general partner Richard Egli in a statement.
Emend and Blue Vision are both early-stage, climate tech-focused venture capital funds that were founded last year. Launched by Alacrity Canada, Emend is working to raise $70 million for its first, Telus Ventures-led fund, which will invest in tech that helps transform traditional industries, protects critical infrastructure, and maintains food and water security. For its part, Blue Vision closed $40 million towards its $60 million goal in 2022.
As Packer noted, “It was important for us to bring on VCs that align with our vision and impact goals in our early rounds, to hold us accountable to our mission of building a global climate movement through the workforce.”
Feature image courtesy Carbon Neutral Club.