Lithos raises $6.3M to give basalt away to farmers

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Lithos raises $6 3M for volcanic carbon farming

, author of A tractor spreads basalt across a field. Photo: Courtesy of Lithos.Exit Content Preview Seattle-based Lithos raised a $6.3 million seed round to give away basalt to farmers — and, in turn, capture vast amounts of carbon. Why it matters: This isn't a mere ag-tech or carbon play. Lithos also aims to become the go-to software provider for carbon accounting and management for soil-based carbon removal. Details: Union Square Ventures, Greylock Partners and Bain Capital Ventures led the all-equity round.It's the first climate-focused investment for both Greylock and Bain. Carbon Removal Partners, the Carbon Drawdown Initiative, Fall Line Capital and Cavallo Ventures participated. What's happening: Lithos is already the largest carbon credits supplier for — the backed by Stripe, Shopify, Meta, Alphabet and McKinsey.It’s also working with Yara, the Norwegian chemicals giant that is among the largest suppliers of nitrogen-based fertilizers.Agriculture about 11% of U.S. greenhouse gas emissions in 2020. How it works: Lithos provides basalt to farmers, who then spread it across their fields to improve crop yields. Lithos customizes each use to match every farmer's particular crop, soil conditions and farming practices. The company then measures how much carbon the basalt captures and sells those credits to buyers.So far it's been sprinkled across more than 1,000 acres. What they're saying: "Ten percent of this is the chemistry of the rock," co-founder Mary Yap tells Axios. "The rest is what happens when you get the rock and spread it in a field." Zoom in: Carbon credits are the company's primary revenue stream — and "the profit margins are very healthy," Yap says. That lets the company give the basalt away and also share a cut of its carbon credit revenue with farmers.Lithos is planning to eventually license its technology to third parties. "We’re trying to get to a billion [tons] captured as quickly as possible," Yap says. The intrigue: Greylock and Bain have traditionally focused on software. What drew them to Lithos is the company's goal to become the software provider for carbon credits management."We think every farmer will be farming carbon alongside their crops. And Lithos is the opportunity to be their carbon accounting and analytics system," Aaref Hilaly, a partner at Bain Capital Ventures, tells Axios.Union Square Ventures has previously invested in carbon startups focused on and — and had been seeking a similar play for soil, investor Mona Alsubaei tells Axios. What we're watching: Lithos is a logistics-heavy business, responsible for sourcing the basalt, transporting all that heavy rock to farms, collecting samples to measure carbon capture — all while maintaining what will have to be a top-flight website to reach its unicorn aspirations. "You're working with farmers, shippers, and enterprise sales," Mike Duboe, a partner at Greylock, tells Axios. Duboe adds that a focus in the months ahead will be streamlining logistics and getting scale there. One fun thing: Yap, whose previous startup was the social payments company Tilt, which , co-founded Lithos with professors from Yale and Georgia Tech. Editor's note: This story has been updated to correct a word in Yap's quote in the "Zoom in" section to "capture" from "dollars" (transcription error). The story also corrects the fundraising figure to $6.3 million in the headline and first sentence.

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