In 2020, Mark Chen’s 12-year-old son made an unusual request for Christmas: instead of presents, he wanted carbon credits. That simple idea sparked a journey into the tangled world of carbon markets—one that eventually led to the founding of CNaught, a climate tech startup aiming to make carbon credits accessible and understandable for smaller businesses.
“When my son asked for carbon credits, I thought it was brilliant,” Chen said “I had a technical background and experience in solar energy, so I figured I could figure it out. But what I found was chaos.”
Chen began by trying to assess the quality of various carbon credit projects. He searched for trustworthy ratings and meaningful environmental impact. But despite his experience, he kept coming up short. That’s when it hit him: this wasn’t just a personal challenge—it was a market failure.
The Carbon Credit Market’s Untapped Potential
Most of today’s carbon credit infrastructure is built around large corporations like Microsoft and Stripe, which have entire sustainability teams dedicated to managing emissions and sourcing verified credits. But Chen believes the industry is missing a much bigger opportunity: the thousands of small and mid-sized businesses that want to reduce their carbon footprint but don’t have the time or expertise to navigate the market.
“There are more than a million companies in the U.S. with over 20 employees,” he said. “Yet, only 7,000 or 8,000 companies are actively buying carbon credits. That gap is enormous.”
To fill that gap, Chen launched CNaught, a platform that acts as a one-stop shop for small businesses looking to purchase carbon offsets easily and confidently.
A New Model for Carbon Credit Buying
CNaught doesn’t create new carbon offset standards. Instead, it works as a curated aggregator. The startup searches for available carbon credit projects, evaluates them using third-party ratings and additional quality metrics, and buys the best in bulk.
These high-quality credits are then held in inventory and sold to customers at a flat rate, simplifying the process for businesses that don’t have time to research every project. Companies can choose specific types of climate initiatives or stick with a default mix—similar to investing in a retail ETF.
“We’re trying to be that easy button,” Chen said. “Customers just need to tell us how much they need, and we handle the rest.”
So far, CNaught has attracted a diverse range of customers, including the Seattle Chocolate Company and Palantir. This shows growing interest from companies of all sizes that want to meet their sustainability goals without getting bogged down in technical complexity.
CNaught’s mission has drawn the attention of climate-conscious investors. The company recently raised $4.5 million in seed funding, led by Bow Capital. The round also included participation from FJ Labs, Karman Ventures, and Silence VC.
Rafi Syed, general partner at Bow Capital, said he was specifically looking for startups that focused on the underserved segments of the carbon market.
“Most climate software startups are targeting Microsoft, Stripe, or Shopify—the big players,” said Syed. “They’re completely neglecting the fat tail of smaller businesses. CNaught is different.”
With its latest funding, CNaught plans to expand its platform and make carbon credit buying as easy and transparent as possible for the companies that need it most.
