Pina Earth gets seed backing to grow sustainable forestry carbon credits

YC-backed climate tech startup, Pina Earth, has closed a $2.5 million seed round of funding a year after being founded and a few months since it presented at the accelerator’s Winter 2022 Demo Day in March.

The seed is led by Franco-German VC XAnge, with participation from London-based VC firm Nordstar, as well as a number of business angels and serial founders, including Gustaf Alstromer (partner at Y Combinator), Sundeep Ahuja (partner at Climate Capital), Lea-Sophie Cramer (founder at Amorelie) and Anselm Bauer-Wohlleb (Alasco, Stylight).

As we reported back in February, when we took a first look at the Munich-based startup, Pina Earth is building an online platform for European forest owners to get certified to sell carbon credits — with a special focus on encouraging landowners to increase woodland biodiversity and future-proof their forests.

That’s important as climate change increases risks to the survival of trees, with more droughts, forest fires, disease and other extreme weather predicted. But the startup’s premise is also that more sustainable forestry management can generate extra carbon credits for forest owners, too.

As a first step, Pina Earth’s platform helps forest owners register their forest for carbon credits. It then sells, essentially, a high tech forest management service — supporting landowners to make adaptations to their forests, such as planting climate-resilient tree species, which should, over years, generate extra carbon credits vs if they did not undertake the sustainability-focused measures that will enable the forest to take up more carbon.

The startup is using AI modelling to predict how climate change will affect the future growth of forests, combined with remote data capture to monitor customers’ projects and verify improvements to forests — to boost the quality of carbon credits.

That’s also important given the proliferation of low quality or bogus carbon offset projects during the ‘greenwashing’ scramble over the last decade+, as companies have rushed to claim they’re taking steps to reduce their business’ climate impact — while, all too often, not actually taking meaningful steps.

The reputation of offsetting as a climate change-fighting tool remains low — while tree-based offsetting attracts specific scepticism given the timescales involved and the difficulty of monitoring over the long haul to ensure the claimed carbon sequestration actually occurs — but given the scale of the challenge humanity is facing, to rapidly shrink carbon emissions in order to avoid climate disaster, offsetting will undoubtedly have some role to play in the mix of solutions.

When we spoke to Pina Earth co-founder and CEO Dr. Gesa Biermann earlier this year, the startup was operating two pilot projects across 1,200 hectares in its home market of Germany and preparing for a commercial launch this year.

Since then, she says it’s been focused on moving from initial pilot projects to expanding its reach in Germany. The commercial launch is still pending.

“We have also recently signed new team members for key positions, in tech, forestry, and business,” she tells ProWellTech. “We are switching from initial pilot projects — which helped us develop our core technology — over to adding thousands more acres of forest projects to our pipeline. We are in private beta with the owners of the respective forests at the moment — testing key features before our public launch of the platform later this year.”

On the product dev front, Biermann says the seed funding will be used for “critical steps in carbon project development include checking for eligibility of the project area, gathering data, calculating the carbon optimization potential and finally, project documentation”.

“After having completed the process for our first projects, we are translating our learnings into replicable processes, automating the bottlenecks of carbon project development,” she continues. “We have already built software to forecast the effect of climate change based on a digital twin of the forest. Next, we aim to replace input traditionally requested from forest owners with third-party data sources to increase speed and independence. We are further expanding our carbon project toolkit, learning to simulate the effect of different types of forest adaptation methods in our software. This will help us address the needs of a diverse range of forest owners.”

Asked if the startup is expecting to launch into additional European markets or would it need to raise again before it takes that step, she talks up the prospect of imminent expansion without offering a clear yes or no — suggesting it’s benefitting by being able to draw on its new European investors’ networks to “forge connections with key players”, before adding: “We are also being approached by both forest owners and project developers worldwide and are keen to bring our product to further regions. After all, over half of Europe’s forests are vulnerable to climate risks — an urgent problem to tackle.”

“Our priorities for the next 12 months are automating further parts of the carbon project development process, expanding to thousands more acres of forest in Germany and selling our first carbon credits to financially incentivize forest owners to adapt their forests to climate change. These priorities are guided by our mission: To offer landowners the most accessible way to get rewarded for making their forest climate-resilient.”

Commenting on Pina Earth’s seed raise in a joint statement, Nadja Bresous, partner (Paris) and Astrid Moullé-Berteaux, associate (Berlin) of XAnge, said: “XAnge is proud to continue investing in climate tech and support European forest adaptation. Pina Earth’s technology generates high-quality European nature-based carbon credits, for which demand will continue increasing. This investment is a contribution to protecting both the financial and the environmental value forests provide.”

While there are a number of other, more established startups focused on expanding access to carbon markets — such as US-focused SilviaTerra (now called NCX) — Biermann argues that Europe remains a “blue ocean opportunity” for forest carbon markets.

“This is partly due to the challenge of a more fragmented ownership structure, meaning smaller sized carbon projects. Therefore, low entry barriers for forest owners, automation and efficiency are central to our product strategy,” she suggests.