Stripe and others to spend nearly $1bn on carbon removal

The Frontier fund will help fledgling carbon-removal companies scale up and reduce the cost of withdrawing each ton of CO2

Patrick and John Collison: Stripe owns the Frontier fund, to which start-ups with technologies that pull CO2 from the air can pitch.

Irish firm Stripe is leading some of the world's largest companies in spending $925m (€850m) buying offsets from start-ups that remove carbon dioxide from the air.

The Frontier fund, a public-benefit corporation owned by Stripe has received funding from Google's parent company Alphabet, Facebook's owner Meta and from Shopify.

The initiative will help fledgling carbon-removal companies scale up and reduce the cost of withdrawing each ton of CO2 from the air, which would benefit all companies in the world looking to buy high-quality offsets.

Climate scientists are clear that every company in the world has to cut emissions first, whether that be through moving to renewable power or other carbon-free alternatives. But the process of reducing emissions has been delayed so much that it will not be possible to meet global climate goals without removing some of the CO2 already dumped in the air. 

Offset purchases made by large companies to deal with emissions it cannot cut, such as those from air travel, could create a business model that will support carbon removal.

Frontier is based on a model that Stripe, led by Limerick brothers Patrick and John Collison, has fine-tuned over the past two years. Start-ups with technologies that pull CO2 from the air can pitch to Frontier. 

The fund will evaluate those technologies with a pool of experts and if they are happy, Frontier will negotiate a price per ton captured and make a commitment to spend millions for the delivery of those tons as offsets.

Stripe and Shopify have each run a Frontier-like fund that has so far supported 14 and 22 start-ups with $7m (€6.44m) and $30m(€27.6m), respectively, in purchase agreements.

“If we don’t hustle and figure out the real potential of these technologies, the world will be put in a challenging position,” said Nan Ransohoff, head of climate at Stripe. 

As much as 6bn tons of carbon will have to be removed annually by 2050, according to the Intergovernmental Panel on Climate Change’s models. “We are relying on technologies that we don’t know can get to that scale,” she added.

• Bloomberg