From left to right: Johan Pihl, Chief Creative Officer and co-founder of Doconomy, and Mathias Wikstrom, Chief Executive Officer and co-founder.
Doconomy
Swedish climate change financial technology startup Doconomy told CNBC on Thursday that it had raised 34 million euros ($36.9 million) from leading European banks UBS and CommerzVentures.
Doconomy, which offers tools to help banking customers measure the carbon footprint of their daily spending, raised the money in a Series B funding round co-led by UBS Next and CommerzVentures, the venture arms of UBS and Commerzbankrespectively.
Financial data and analytics company S&P Global The company came on board as a new investor, and existing shareholders Motive Ventures, PostFinance and Tenity also took part.
Founded in Sweden in 2018, Doconomy works with companies such as Boston Consulting Group, Mastercard, S&P Global and the United Nations Framework Convention on Climate Change to calculate the climate costs associated with financial transactions.
The company’s tools include AIand Index, a cloud-based service for banks that helps their customers convert each transaction into the corresponding carbon footprint. The index is used by more than 100 financial institutions in more than 40 countries.
Doconomy plans to use the fresh money to fuel expansion into North America and launch new products, CEO and co-founder Mathias Wikstrom told CNBC in an interview.
“In the future, we want to enable every bank in every corner of the world to involve their customers in ESG [environmental, social, and governance] work of the bank,” said Wikstrom. “We see a connection between E and S, the environmental and the social. We cannot isolate these two different streams.”
Wikstrom said he was “very happy” to see partnerships emerging with companies like UBS and Commerzbank, describing it as “an alliance of those who are gaining both money and brains to get to grips with this problem.”
Politicization of the climate
News of Doconomy’s latest funding follows the company’s February 2023 deal to acquire Dreams Technology, a platform that uses behavioral science to increase customers’ digital engagement and financial well-being.
Wikstrom said Doconomy’s valuation in its Series B round remained unchanged from the price at which the company raised funds in its Series A round City ventures, MasterCardand Ikea parent company Ikea.
Doconomy’s growth story is not without its challenges. More recently, the company has faced attacks from right-wing online commentator Jordan Peterson and his followers.
It’s not really hurricane season anymore, it’s fear season.
Mathias Wikstrom
CEO, Doconomy
Last week, Peterson took out the company in a post on the social media platform
The Canadian psychologist who became famous online for his criticism of so-called political correctness is a well-known skeptic who called climate change “the idiot socialist’s get-out-of-jail-free card.” He once described rising greenhouse gas emissions as having a positive impact on the planet becoming “green in the driest areas.”
Climate scientists say this is misleading because it does not take into account the negative impact that increased droughts, wildfires and heat waves caused by global warming are having on plants and ecosystems.
Wikstrom told CNBC that the situation surrounding Peterson’s attacks on his company “shows that we need to educate a lot of people.”
“Fear will lead to frustration, and frustration will potentially lead to protests, and protests will lead to violence, and violence will lead to harm done,” he told CNBC.
Wikstrom said he hopes that the more people like Peterson and other climate skeptics continue to “beat the drum,” their feelings will eventually ring “hollow.”
“If you look at what’s happening in Hawaii, in Canada, in France, in Spain, in Greece – we have the floods, we have the fires, we have so many worries now,” he said. “It’s not really hurricane season anymore, it’s fear season.”
Climate fintech is a niche area of financial technology that has attracted increased interest among investors as governments around the world push companies to meet ESG goals and reduce carbon emissions associated with their operations.
Michael Baldinger, UBS’s chief sustainability officer, said the bank’s venture investment in Doconomy “underlines our focus on driving innovation to provide the data and actionable insights our clients need to make informed decisions about their investments and the to bring about the desired changes.”
Clarification: The headline of this story has been updated to clarify that CommerzVentures, the venture investment arm of Commerzbank, co-led Doconomy’s €34 million fundraising campaign.
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2024-05-31 09:59:35
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