Climate change has now become an inevitability and the clock is still ticking to solve the much more catastrophic climate crisis. But despite the mounting urgency, leading governments are falling behind in reaching the UN’s Sustainable Development Goals (SDGs) by 2030. A major gap stalling meaningful and impactful change in the timeframe given by climate scientists is funding and monetary allocation to vital projects.
The estimated funding gap for green projects is $50 trillion over the next decade. And as the window of opportunity closes, the imperative of finding an effective solution to mobilize the necessary resources becomes more pressing every day. For projects that rely on outside investment, funding pipeline blockages are causing critical initiatives like climate adaptation infrastructure to receive under 10% of the estimated $340 billion in support it requires. To ensure that funding goals are met, worthy projects of all scopes working in climate development and humanitarian aid must now seek different avenues to attain funds.
Bitgreen responds to this critical shortfall with a novel infrastructure for grassroots-level sustainability and impact projects to find a global investor community. Powered by Polkadot, the leading sustainable blockchain network, Bitgreen enables backers to finance sustainability projects, including conservation, clean infrastructure, and empowerment initiatives for vulnerable communities. On the heels of winning the 29th parachain auction, Bitgreen has activated its chain for its token holders to stake their assets, connect with projects, and utilize dApps launched natively on the network.
We sat with Adam Carver, CEO and co-founder of Bitgreen, to outline his journey to sustainable blockchain development, Bitgreen’s mission, and tips for founders and entrepreneurs entering the impact investing space.
Tell us about your background.
It may sound like heresy but my background is in traditional finance. I began my career in structured finance at Morgan Stanley and the Royal Bank of Scotland. That makes me a bit of an oddity in DeFi, but that formal training guides how we address Bitgreen as a financial platform irrespective of our use of blockchain as an enabling technology. We keep a keen eye on credit-risk assessment, deal quality, knowing our customers, and regulatory compliance.
Anyway, after Morgan Stanley, I pursued an MS in Sustainable Systems at the University of Michigan. Post graduation, I returned to New York and started working in venture capital, eventually working as Director at AngelList and then as Co-founder/Managing Director at TheFund.vc. I left AngelList in 2018 to leap into the wild world of crypto.
Why did you decide to found Bitgreen?
One day in 2021, I had a “mirror moment” as I refer to it. It struck me that there were too few high-quality technical teams targeting really important problems, such as climate change, deforestation, obesity, mental health epidemics, etc.
These pressing problems are only intensifying and far outpacing the mindshare committed to contending with them, and it’s just pathetic and so dispiriting to witness the smartest minds and venture dollars FOMO’ing into digital monkeys, as Vitalik puts it.
So one evening I mentally sized up the total landscape of serious teams who I believed were working on these challenges, and the number I came up with was around 100-200. And that was terrifying! It was like a giant Maslow’s Triangle flipped upside-down and resting on the pinpoint of a small, outgunned number of tech teams. From that moment forward I knew I couldn’t look in the mirror unless I stepped into the ring too.
Tell us more about your technology.
Bitgreen is an open and permissionless blockchain built to meet the needs of purpose-driven innovation in Web3. The phrase “purpose-driven innovation” could mean many things of course, and we don’t have a clear definition yet because it’s impossible to specify. But we do know that it considers the collective good over competition, long-term durability over short-term satisfaction, and shared wealth over individual gain.
Under these headings, the apps we’d like to see launched on Bitgreen would target microfinance and financial inclusion, renewable energy development, conservation finance, green supply chain management, corporate ESG, nonprofit support, physical and mental well-being, community activation, and more. In late 2022 and early 2023, we hope to come to market with three applications: A Bitgreen Carbon Platform, Impact Investing Marketplace, and a consumer-level wellness initiative.
How does your company innovate?
I’m not sure that I understand the question. But in our market, the broadly-speaking sustainability market, the fundamental friction is difficulty in coordinating capital, data, and human resources. For example, non-profits and multilaterals lack the resources of big banks to adopt bleeding-edge technology. Bitgreen can assist in releasing tools for enhancing how money flows among groups, how performance data is measured and reported, and where financial and social accountability lies.
What’s your company’s mission?
Bitgreen put a number on it. The physical cause of climate change is quantitative (CO2 parts per million) as well as financial. Analysts estimate humanity is operating at a $50 trillion deficit to meet the UN Sustainable Development Goals. And let’s be frank, we are going to blow past a global warming “red zone” of 3.5 degrees Fahrenheit (2 degrees Celsius) and on our way to a 10-degree Fahrenheit warming long before we figure out what happened to ski season.
Bitgreen’s mission is to raise $1 trillion for sustainability projects in 10 years. Impractical? Maybe. Existential? Believe it. This is the ultimate moonshot and somebody has to try.
Tell us about Impact Investing? How does it relate to carbon credits?
We differentiate Impact Investing and Carbon Credits as two different activities and markets.
Carbon credits can be either a voluntary philanthropic purchase or a mandated cost of commercial business, as in Europe where the European Union forces carbon emission offsetting onto countries and corporations. Yet in both situations, the end state of purchasing and retiring a carbon credit is an operating cost or philanthropic donation. To me, this activity doesn’t meet the definition of an “investment.” But, what it does accomplish is transfer wealth to global communities and natural ecosystems in need of income subsidies for conservation or carbon technology innovation. And we should celebrate that objective.
On the flip side, impact investing is when you invest a dollar and have an expectation that you receive that dollar back, potentially with some carried interest in the performance of the investment. Examples include green energy investing, microlending, or banking a fair trade cacao farm.
Why is Blockchain important for this?
Baseline, these markets are neglected by capital markets. Full stop. The current financial zeitgeist cares little for value creation beyond the next quarter’s earnings. By design, impact investing and its kin tend to be slower to return capital and less individualistic. In many cases, the value accrues to society and a multitude of stakeholders, not only stockholders and LPs.
Blockchain can aid with aggregating capital quickly, broadly, and at a low cost. It can assist with transparency of performance, due diligence, monitoring, auditing, and post-transaction settlement. Most of all, it creates access for investors to invest in these opportunities and concurrently enables sustainability projects to access investors.
How do you see the future of Web3? Anything particular on the horizon you are keeping your eyes on?
The previous bull cycles were predominately fueled by speculation on assets that lacked true value. But after 5+ years of development, there are projects coming online that have high real-world utility. If that comes to fruition, that will fuel an entirely different bull cycle based on products and companies that have actual business models and utilities. Bitgreen wants to stoke that bull run alongside those other companies.
What advice would you give to fellow entrepreneurs?
- Care deeply about the problem because it comes from your heart and guts. There is no substitute for intrinsic motivation.
- Be resilient and practice callusing your mind to pain, surprise, disappointment, and naysayers.
- Invest equally in storytelling and marketing as you do in the product, perhaps not synchronously though. Just because you build it, they may not in fact come.
- Manage your blue light exposure. 😉