Reversing Climate Change 346: How Structure Climate Financed Carba’s Biochar Offtake Agreement with Microsoft—w/ Andrew Jones of Carba & Matt Schmitt of Structure Climate
Apr 30, 2025
Matt Schmitt, Founder and CEO of Structure Climate, and Andrew Jones, Co-founder and CEO of Carba, discuss a game-changing partnership where Microsoft committed to purchasing carbon credits from Carba. They dive into the intricacies of financing carbon removal projects, highlighting the critical role of debt in bridging the gap from agreement to scale. The conversation also sheds light on how innovative financial structures can unlock the potential of climate tech companies while addressing the challenges of securing funding for transformative environmental solutions.
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Significance of Microsoft's Offtake Deal
- Landing a major offtake deal like Microsoft's purchase signals validation and trust for a carbon removal startup.
- However, such deals usually don't mean upfront payment and require proven progress and risk management over time.
Equity vs Debt Financing
- Equity financing gives startups flexible capital but at high cost and with diluted ownership.
- Debt financing is cheaper but has strict repayment terms and is hard to obtain for startups due to risk.
Carba's Biochar Project Story
- Carba turns waste municipal wood, often discarded, into biochar to reduce landfill emissions.
- Biochar application provides carbon removal and co-benefits like reducing landfill odors and methane leaks.