Flowcarbon, co-founded by former WeWork CEO Adam Neumann planned to revolutionize the carbon credit market by tokenizing carbon credits on the blockchain. The project faced a setback leading to the refunding of millions to investors after the failure to launch its Goddess Nature Token (GNT).
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Flowcarbon was launched in 2021 with the goal of utilizing blockchain to streamline and modernize the carbon credit market. The company proposed tokenizing carbon credits, thereby making them easier to trade and improving access to climate projects seeking funding.
The creation of its cryptocurrency, Goddess Nature Token was central to this vision. The company’s proposition attracted considerable investor attention including a $70 million funding round led by Andreessen Horowitz, a leading venture capital firm.
The company promised to solve the issues related to the fragmented and opaque infrastructure of the carbon credit market. Despite initial excitement, GNT has yet to see the light of day.
Since its founding, Flowcarbon has not been able to launch the GNT, which was intended to be a tool in transforming how companies trade carbon credits. The token was designed to offer greater transparency and efficiency in the carbon markets.
The company has attributed its inability to launch the token to unfavorable market conditions. The volatility of the cryptocurrency space combined with resistance from key players in the carbon credit registries has led to a delay in bringing the token to market.
The company has been quietly refunding investors who had purchased the Goddess Nature Token. This move, which was first reported by Forbes has been done discreetly, likely to avoid reputational damage.
The primary product of Flowcarbon was the Goddess Nature Token, a cryptocurrency that would be backed 1:1 by carbon credits.
These tokens were designed to represent a metric ton of carbon dioxide that had been removed from the atmosphere. However after a year of delays, the GNT token never launched.
Flowcarbon cited poor market conditions as one of the main reasons behind the token’s delayed launch. The cryptocurrency market has been volatile with both regulatory and fluctuating token prices making it difficult for projects like GNT to gain traction.
The carbon credit market has been met with skepticism from key players. Major carbon registries, which oversee the issuance and tracking of carbon credits, concerns over the idea of tokenizing these credits.
One major worry was the possibility of double-counting, where the same carbon credit might be counted twice, once in its physical form and again as a tokenized asset.
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This combination of market resistance and regulatory challenges eventually led Flowcarbon to abandon the GNT project resulting in the company refunds to investors.
After waiting over a year for the launch of the GNT token, many investors including firms like Andreessen Horowitz (a16z), began to lose patience. In recent weeks, Flowcarbon has started to issue refunds to investors.
Flowcarbon reportedly held Zoom calls with investors to explain the situation, addressing the tough market conditions and resistance from key carbon registries.
As part of the refund process, Flowcarbon required investors to sign a waiver of claims. This waiver prevents investors from pursuing legal action against the company and its affiliates.
Additionally, certain confidentiality terms were imposed restricting investors from publicly discussing the refund process or their involvement in the project.
According to a Flowcarbon spokesperson, retail investors who had purchased GNT tokens had been offered refunds with standard and customary terms since the previous year.
The company did not make any formal public announcements about these refunds, which led to some confusion and frustration among investors.
Flowcarbon received huge backing from venture capital firms and investors. In May 2022, the company raised $70 million in Series A funding with names like Andreessen Horowitz, General Catalyst and Samsung NEXT leading the investment round.
A huge portion of the funds, around $38 million was reportedly raised through the sale of Flowcarbon’s GNT tokens.
Flowcarbon’s struggles also bring into question the fate of its investors especially Andreessen Horowitz (a16z). As one of the venture capital firm’s largest investments in the climate space, Flowcarbon’s failure to launch its key product has concerns over the firm’s investment strategy.
In 2022, he launched Flow, a real estate company aimed at transforming apartment living. This company also secured a huge investment from Andreessen Horowitz, with the firm putting $350 million into Flow, largest single investment to date.
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