Siebel's Stealth Carbon Startup C3 Lands $26 Million And Condoleezza Rice On Its Board

What do Thomas Siebel, Condoleezza Rice and $26 million have in common? They are all connected to stealth energy startup C3, which may be entering the business of managing carbon cap-and-trade systems for corporations. In the past two weeks, C3 has filed three Form Ds with the SEC disclosing financings totaling almost $26M. Very little is known about the company publicly, and the company declines to comment on its future plans (or anything else). But from other publicly-available sources, an interesting story can be pieced together.

C3 is the brainchild of Thomas Siebel, former CEO of Siebel Systems which was bought by Siebel’s previous employer Oracle for $5.7 billion in 2005. Siebel has brought in a lot of familiar talent, including former Siebel Systems and Oracle executives Patricia House and Edward Abbo. House is a star, serving on a number of boards and in the past being named one of Fortune’s 50 most powerful women. Abbo is the former CTO of Siebel Systems, among other positions. The holdover team from Siebel, including its CTO, points towards enterprise software.

Also among the C3 board of directors are former Secretary of State Condoleezza Rice and former Senator and Secretary of Energy Spencer Abraham. Both are powerful Republicans, which comes as no surprise as Siebel played a role in introducing Vice Presidential candidate Sarah Palin to California. Far more interesting is the role each might play. C3 is focused on energy management and a former Secretary of Energy is a logical (and valuable) asset in that business. More interesting is the potential role of Rice. Rice’s most visible experience is as America’s lead representative to the world, suggesting that C3 is planning an international play.

Another key Director is Jay Dweck, a Managing Director and Global Head of Strategies and Technology for the Institutional Securities Group at Morgan Stanley. Mr. Dweck’s insider knowledge of institutional securities and the underlying technology at least raises the possibility that C3 will seek to securitize and/or create a market for some kind of carbon security.

So what does an enterprise-software, energy-management company with international ambitions, $26 million in capital, and sophisticated financial securities software do? Besides make a lot of money of course.

One logical answer is that the company is planning to create software/platforms for the management of carbon emissions. What makes the space potentially so valuable is cap and trade. These systems substitute a market for regulation; an enterprise’s carbon emissions are measured against a specific amount, the cap. Companies with emissions below the cap can sell their extra “space,” while companies whose emissions exceed their cap need to purchase permits for their overage. Cap and trade is not currently in use in the United States, although it has been proposed and is being pushed by the Obama Administration, but it is being used to reduce carbon emissions on a cost-efficient basis elsewhere, notably in the EU.

Two large and related problems plague cap and trade systems. One is measuring emissions (in an officially sanctioned manner) and the other is pricing them, and those two problems could very well be C3’s targets. The goal in this scenario would be to get licensed or approved to create and run cap-and-trade markets. If cap and trade is ultimately adopted as the way to control carbon emissions in the name of reducing global warming, it will be a multi-billion dollar market.

C3 bills itself as an “Energy and Emissions Management” company. Limited information about it is currently available at, itself an unlikely website. The company also appears to own, and may be shopping for a more euphonious domain as it has chosen to remain at the welcome site as opposed to the longer term, which redirects.

There are other companies tackling this problem such as Greenstone Carbon Management, Carbon Hub, and Carbon Trust, but the glowing board/leadership pedigree on top of nearly limitless access to capital make C3 a diamond in the rough, so to speak.