Why We Invested in Patch

September 13, 2022

By Sami Ahmad, Karly Wentz, Jeffrey Goldsmith and Narmeen Haider

The race to reach net zero is on and the stakes have never been higher. 2022 is already set to rank among one of the 10 warmest years on record, and climate impact threatens to push millions into poverty. To stop – and ultimately reverse – climate change, the global business community must step up to the front lines. Business leaders have two options to reach net zero goals: 1) decarbonize by lowering emissions output, and 2) offset emissions in cases where decarbonization is not financially or technologically possible. A mix of both strategies will need to be leveraged in order to achieve net zero. 

Given the expected rise in demand for carbon credits, we need voluntary carbon markets that are transparent, verifiable, large, and robust. Today’s carbon credit market is fragmented and complex, with lack of data on pricing, and it is hampered by opaque verification processes and limited selection. Easier to use carbon credit marketplaces will lower the barriers to entry so that individuals and organizations can do their part in tackling climate change.

That’s why we’re excited to announce our investment in Patch, a digital backbone for the future of carbon markets. Founded in 2020 and based in San Francisco and London, Patch offers a suite of APIs and developer tools that connect buyers and sellers of carbon credits – giving enterprises seamless access to a diverse base of high-quality credits. The company is taking extraordinary steps to address the core challenges facing the carbon credit market and build a durable and accessible marketplace.

Patch’s API-based solution allows customers to embed transactional carbon footprint estimation and removal directly into digital products and experiences, enabling individuals to take climate action on a more granular level than ever before. Patch is leveraging best of breed registration, verification, and ratings providers to ensure visibility and transparency – creating a sense of trust in a market that is typically opaque. Patch’s suite of developer tools make it easier for suppliers to bring their product to market and access a broad range of potential buyers. Reducing friction for suppliers will be a key enabler for growing the market for high-quality credits.

We were particularly impressed with the high-caliber network of customers and suppliers that Patch has been able to build in a short period of time. Patch has successfully acquired enterprise customers across a variety of industries including ecommerce, fintech, travel, and transportation. The company has a robust international presence and strong partnerships with industry leaders such as Persefoni, Doconomy, Afterpay, Route, Plaid, and many more. On the supplier side, the team has developed deep partnerships with some of the most sought after carbon credit providers on the market, including NCX, Living Carbon, CarbonCure and Anew. This robust network has led to industry-leading growth in a massive emerging market. 

When we first met Brennan Spellacy and Aaron Grunfeld, it became clear Patch’s success is driven by its talented and mission-driven leadership. Brennan and Aaron met as early employees at Sonder where they both helped scale the company globally. At Patch, their vision and energy toward solving one of the world’s biggest problems has enabled them to attract a phenomenal team that continues to execute.  

At B Capital, we strive to partner with industry leaders that help enterprises adapt to changing environments. Patch is doing just that – enabling ease of access and bringing down the barriers to entry for new participants in carbon marketplaces. Through our global footprint and partnership with BCG, we look forward to supporting Patch. We are thrilled to partner with Brennan, Aaron and the Patch team in their future growth.