“Start as you mean to go on,” the saying goes. Judging by our first-quarter commercial and capital milestones, Oka has set itself a high bar for the remainder of 2024. Here’s what you might have missed in a jam-packed quarter for our team, as for the voluntary carbon market (VCM) at large.
On Home Turf: New Global Channel Partners, New Capital
In January, we received official Lloyd’s approval for and started underwriting through Lloyd’s syndicate-in-a-box Oka Syndicate 1922. Developed in partnership with leading third-party managing agent Asta, Syndicate 1922 meets burgeoning demand for innovative risk and quality solutions in the voluntary carbon market (VCM).
Right on cue followed a series of high-profile customer acquisitions, including our inaugural channel partnership with digital carbon credit platform Cloverly and a market-first collaboration with Oregon Biochar Solutions (OBS) and GECA Environnement. Through the latter, Oka became the first insurance company to underwrite biochar credits against invalidation and reversal risks.
Oka’s trajectory would not be possible without the support of our investors. Rounding out March, we were delighted to announce our $10 million investor raise last week. Our funding round attracted the support of a number of leading investors, including Aquiline Capital Partners LP, firstminute capital, and Overview Capital. In addition, we’ve partnered with three reinsurance providers and secured a capital commitment from NASDAQ-listed reinsurer Greenlight Re, which will participate as a capacity provider for the syndicate in its first three years of operation.
In a tough year for venture capital generally and our operating market specifically, investor enthusiasm — coupled with early customer traction — reinforces our thesis that insurance is the ‘missing piece’ or key to transformational scale in the VCM.
In Industry Updates: New Regulation, Old Risk
Since my last newsletter, media interest has propelled carbon insurance — and Oka, by association — into the spotlight. Our traction has attracted attention from journalists at Sønr Global, Reinventing Finance, The First 100 Podcast, Quantum Commodity Intelligence, and AM Best, while publications such as GreenBiz and Eco-Business are honing in on the insurance-shaped opportunity ahead.
The growing interest in carbon-credit risk mechanisms is unsurprising in the context of wider industry trends — namely, regulation.
In March, the SEC passed its climate disclosure rule, all but assuring fresh appetite from US-listed companies that don’t want unaddressed emissions lingering on their risk reports. Meanwhile, CORSIA is taxiing for take off, heralding a wave of demand from the hard-to-abate international aviation sector. Both catalysts create a powerful tailwind for the VCM. Can the VCM rise to the occasion?
That’s the billion-dollar question to which I turned my attention during and after February’s seminal GreenBiz 2024 conference, where we saw a communications gulf growing between buyers and developers. Occupying the ambiguous space between voluntary and compliant, this new generation of market participants cares as much about risk management as they do sustainable impact. They may be unfamiliar with and liable for transaction risk, and existing risk-management markers are either scarce (the Core Carbon Principles) or insufficient in silo (Measurement, Reporting, and Validation).
In short, the project-level case for carbon insurance has never been stronger. For first movers, the opportunity has never been bigger. Will you help us lead the way?
