Bankruptcies | The company that offered Antero Vartia’s emission compensation filed for bankruptcy: “Makes room for something new”

Emission compensations the company that offered it, Compensation Operations, has filed for bankruptcy. The company filed its bankruptcy petition with the Helsinki District Court on Friday.

Compensation Operations was best known for its founder, a former Green MP Antero Vartian through. He told about the company’s situation In an interview with HS Vision last April. Bankruptcy seemed to be inevitable even then, and that is why the company had laid off more than 20 of its employees.

“By resigning in sufficient time, we aim to take care of our obligations, i.e. for example salaries, taxes and emission compensation payments,” Vartia said in an interview.

The reason for the bankruptcy of Compensation Operations was the lack of funding. The company had started looking for ten million euros in financing at the end of last year, but the necessary amount could not be found on the market.

According to Vartia, nothing special has happened in the company’s operations in the past two months.

“At the end of April, it seemed very likely that the company’s operations would end. At that time, we fired all our employees and focused on winding down our operations. Nothing more special has happened in two months. The company has now filed for bankruptcy,” he told HS on Sunday.

In 2019 the road to the established Compensate has been rocky.

Immediately after the establishment of the company, the Police Board requested an investigation. According to the legal interpretation, the operator offering emission compensations needs a money-raising permit, which cannot be granted to companies.

The situation changed in October 2021, when the parliament approved an amendment to the law, according to which the sale of emission compensations does not require a fundraising permit.

Compensate’s first real business year was last year. At that time, the company had a turnover of 2.7 million euros. In the first quarter of this year, the company’s turnover was around one million euros.

The company’s operations seemed to take a nosedive in the very last meters. For example, in March of this year, the British financial magazine The Economist bought carbon dioxide sequestration through Compensate.

In addition, the company had already managed to get the US Climate Neutral certificate as a customer. In an interview with HS Vision, who worked as the company’s responsibility director Niklas Kaskeala also reported that the London School of Economics had become Britain’s first carbon-neutral university thanks to Compensate’s clientele.

I’m on guard according to the company was always getting more customers. However, obtaining further funding became an obstacle to operations.

In 2019, the company also took out a capital loan of seven million euros from Business Finland. In an interview with HS Vision, Vartia estimated that it formed a “block”.

“We need to raise a large amount of funding, because the company has a total of around eight million euros in debt. If we raised only one million euros with a valuation of, for example, five million euros, the investor would have to immediately write down his one million euro investment to zero.”

Compensate’s bankruptcy was the first to report Trade magazine. According to the newspaper, Business Finland will with a high probability lose the funds it lent to the company due to bankruptcy.

The Compensate foundation behind Compensate continues to operate despite the bankruptcy. Through the foundation, consumers have been able to compensate for their own emissions.

Vartia says that he currently has no plans for what he would do after Compensate’s bankruptcy.

“I haven’t decided what to do next. The end of Compensate’s operation naturally makes room for something new. Time will tell what it is.”