Pachama
Winter 2019AcquiredRestoring nature to solve climate change.
Pressure-test this opportunity
Explore the risks and possibilities with a prompt for ChatGPT, Claude, or your agent.
Restoring nature to solve climate change.
Explore the risks and possibilities with a prompt for ChatGPT, Claude, or your agent.
Pachama tried to make forest carbon credits easier to trust and easier to buy. The company used satellite imagery, machine learning, project documents, and human review to assess whether forest projects were protecting or restoring land. It then sold credits from selected projects and later helped create new projects through Pachama Originals.
That combination attracted major corporate buyers and about $88 million in disclosed financing. It also placed two jobs with different incentives inside one company: judge project quality and sell approved inventory. When investigative reporting challenged forest-credit baselines in 2023, that tension became a public liability. The wider voluntary carbon market then contracted, corporate sustainability budgets tightened, and Pachama cut staff and retreated from project development. Carbon Direct acquired Pachama in November 2025, adding its forest-monitoring technology and part of its team to a larger climate advisory firm. The price and investor outcome remain undisclosed.
This was not a case of a product finding no use. Pachama moved money into forest projects, won recognized customers, and built measurement systems that a strategic buyer wanted. Its independent venture-scale path weakened when trust in the category fell and the company could not fully separate evidence from commerce.
Diego Saez Gil and Tomas Aftalion incorporated Pachama in October 2018 and entered Y Combinator's Winter 2019 batch. Saez Gil had built travel and hardware companies; Aftalion brought experience in artificial intelligence, deep learning, and cloud systems. Aftalion first considered machine learning for agricultural insurance. After meeting Saez Gil, the pair focused on forests and carbon markets. A Carnegie Mellon profile describes the shift from that first concept to measuring forest carbon.
The mission took shape during an October retreat in California's Santa Cruz Mountains. Aftalion later wrote that they decided to restore nature as a response to climate change and chose a name derived from Pachamama, the Andean earth mother. Their early instinct was to perfect the technology. YC partner Michael Seibel pushed them toward a direct test: sell carbon credits immediately.
The advice shaped the company. Pachama did not begin as a remote-sensing vendor. It built a marketplace where measurement supported a transaction. Microsoft became an early major customer in 2020, followed by companies including Airbnb, Mercado Libre, Salesforce, Shopify, Netflix, and BCG, according to Aftalion's account.
The marketplace presented a selected inventory of forest credits. Behind it, Pachama reviewed project documents and used optical, infrared, radar, drone, and LiDAR-derived observations to estimate biomass, monitor forest loss, and test project claims. Remote sensing did not eliminate field measurement or registry verification. It made independent checks faster and gave buyers a common view across projects that otherwise arrived as PDFs and spreadsheets.
Baselines were the hardest technical and commercial problem. A forest-protection project earns credits against an estimate of what would have happened without it. Pachama's Dynamic Control Area Baseline divided project land into small tracts and matched them with untreated areas using forest cover, topography, road access, and political jurisdiction. The company ran pseudo-projects and reported uncertainty to test whether the model invented benefits where none existed. S&P Global described the approach when Pachama released its revised project criteria.
Pachama Originals moved upstream. Instead of screening only issued credits, the company helped design and finance reforestation projects. A company case study said its work with Mercado Libre committed $23.7 million across ten projects in Brazil and Mexico, covering 15,000 hectares with stated goals of planting 15 million trees and removing 1.1 million tonnes of carbon dioxide. These are project and company claims, not independently audited results in the located evidence.
The final product turn was Pachama Insights. Launched in April 2025, it organized hundreds of projects, extracted facts from documents, supported diligence, and tracked changes over time. That was a return to the company's strongest capability: turning scattered project evidence into reviewable decisions.
Pachama served corporate sustainability and procurement teams buying voluntary credits, as well as developers that needed capital and credible measurement. Major brands gave it distribution and supplied projects with funding. The buyer needed more than tonnes and price: procurement teams had to defend additionality, permanence, leakage, community effects, and reputational risk.
This customer had a difficult mandate. Carbon credits were a small discretionary budget for many companies, but each purchase could invite public scrutiny. Pachama tried to reduce that burden with a trusted catalog, scientific review, and a transaction path in one place.
The market looked large when corporate net-zero pledges accelerated. Pachama raised its Series B into that expectation. The realized market moved the other way. Trellis estimated voluntary carbon-market value at about $530 million in 2024, roughly one quarter of its size three years earlier. That contraction mattered more than a broad forecast of future offset demand. A venture-backed marketplace needs current transaction volume, repeat buyers, and enough margin to support sales and scientific review.
Regulation also divided demand. Some buyers sought voluntary claims; others needed credits eligible for compliance systems. The Integrity Council now evaluates both crediting programs and individual methodologies for its Core Carbon Principles label. Eligibility, claim language, host-country authorization, and credit quality became separate diligence questions.
Pachama competed with brokers and marketplaces for transactions, with consultants for corporate trust, and with ratings firms for evidence. Sylvera now offers independent ratings, geospatial monitoring, market data, and a catalog of more than 20,000 projects. Its monitoring product flags material changes and updates ratings. BeZero's platform combines analyst ratings, standardized project fundamentals, spatial data, and pre-issuance tools.
These competitors show where the category settled: independent opinion and workflow software are products of their own. Carbon Direct occupied another position, combining climate science and buyer advisory. Acquiring Pachama gave it forest-measurement technology without asking Pachama to keep supporting a standalone marketplace, project-development arm, and diligence platform.
Pachama's public materials do not disclose revenue, gross margin, or the split among software, transaction, project-development, and service income. The marketplace likely earned a margin or fee on credit sales; Originals linked the company to longer-duration project finance and development; Insights moved toward software and diligence. That evolution increased the number of parties and timelines Pachama had to coordinate.
The marketplace supplied useful early revenue and market learning, but the company that approved inventory also benefited when that inventory sold. Strong review standards could reduce supply. Lenient standards could increase revenue while damaging trust. Pachama said it accepted only about one in three projects it evaluated, evidence that it rejected inventory. The structural question remained visible to customers and critics.
Pachama raised about $88 million and sold to some of the world's most recognizable technology and consumer companies. Saez Gil reports that the company directed more than $100 million to forest projects, helped protect more than two million hectares, restored tens of thousands of hectares, and kept more than four million tonnes of carbon dioxide out of the atmosphere. His account is the most complete statement of impact located, but the figures are company-reported.
The acquisition is another form of traction. Carbon Direct wanted Pachama's measurement and monitoring work after the voluntary market had contracted. The technology and team had strategic value even though the deal's financial outcome is unknown.
The immediate pressure came from a loss of confidence in forest credits. A January 2023 SourceMaterial investigation reported former head scientist Elias Ayrey's allegation that commercial pressure conflicted with Pachama's evaluator role. It discussed projects whose deforestation assumptions or observed outcomes were disputed. Saez Gil answered that the company considered internal and external expert views, had stopped selling the credits at issue, and accepted only a minority of evaluated projects. The investigation called Pachama one of the more conscientious participants while questioning the model around it.
Pachama responded with stricter criteria, new baseline work, and platform-wide re-evaluation. Those moves improved the evidence process but could not restore market demand alone. Nature-credit prices fell sharply in 2023. Anti-ESG pressure and economic uncertainty then reduced discretionary sustainability budgets. Project development added long commitments while buyers became cautious.
By June 2025, Pachama cut about 20 roles and returned to its geospatial diligence core. Five months later, Carbon Direct bought the company. Axios reported that terms were undisclosed and that Saez Gil and other employees joined Carbon Direct. The outcome preserved the product inside a larger advisory business; the evidence does not support calling it either a successful investor exit or a collapse.
The central failure was organizational fit. Pachama built scientific review, project origination, and credit distribution together at a time when rapid category growth could cover the tension. When trust and volume fell together, each activity made the others harder: strict review constrained supply, project commitments consumed capital, and selling credits weakened the appearance of independence. Insights pointed toward a narrower company, but the change came after years of expansion and substantial fundraising.