“Running Tide, Carbon Removal Startup Backed by Microsoft and Shopify, Shuts Down Due to Lack of Funding”

Running Tide, a carbon removal startup that made headlines for its innovative approach to sequestering carbon dioxide in the ocean, is now shutting down due to a lack of financial backing. The company, which had signed on major customers such as Microsoft, Shopify, and Stripe, announced its closure in a post by CEO Martin Odlin on LinkedIn.

Just three months ago, Running Tide had successfully completed a trial that sequestered 21,000 metric tons of carbon dioxide in biomass sunk deep in the Icelandic ocean. This achievement earned the company offset credits for its early customers. However, despite its promising start and a roster of two dozen clients, Running Tide was unable to secure the additional funding needed to scale up its operations.

Odlin highlighted the challenges of operating in the voluntary carbon market, noting that there simply wasn’t enough demand to support large-scale carbon removal efforts. The company had been exploring various approaches to carbon removal, with a focus on sinking biomass, such as forestry waste, into the ocean to avoid emissions that would result from burning the material.

Running Tide had raised $54 million in a Series B round led by investor Chris Sacca’s firm, Lowercarbon Capital. The funding was used to expand the company’s team to 120 experts in various fields related to carbon removal. Despite its efforts, Running Tide’s revenues remained undisclosed.

The closure of Running Tide reflects the challenges facing the carbon removal industry, with many startups struggling to attract customers and secure funding. With $1.2 billion invested in early-stage carbon removal startups in 2023, the space is ripe for consolidation. Nan Ransohoff, head of climate at Stripe and lead for Frontier, a $1 billion carbon buyers group, noted that more startup failures are expected in the coming months and years as the industry matures.

In an upcoming episode of Climate Pioneers, Ransohoff will discuss how Frontier evaluates risky startups and which solutions are gaining traction in the industry. The conversation will also cover lessons learned and governance responsibilities between Stripe and Frontier.

For those interested in learning more about the carbon removal industry, a webcast featuring Ransohoff will be held on July 17 at 1 p.m. ET. Participants can register to join live or watch the recorded interview.

As the carbon removal industry continues to evolve, events like VERGE 24 provide professionals with the opportunity to streamline their supply chains and drive transformative, decarbonized change. The event, scheduled for October 29-31 in San Jose, will bring together industry leaders to discuss the future of sustainable business practices.