Dcycle acquires ESG-X as sustainability reporting’s great consolidation continues

Dcycle has acquired ESG-X as the consolidation of the sustainability reporting accelerates.

Founded by Juanjo Mestre, Jacobo Umbert, and Luis Escámez, Dcycle is a SaaS platform that helps companies track and report non-financial ESG data, including emissions, energy use, and supply chain metrics, to meet European sustainability reporting requirements.

Meanwhile, Germany-based ESG‑X was founded by former Tesla business exec Valentin Aman, software engineer Paolo Mazza, and ESG consultant Jean Bauer through the Antler accelerator. The startup builds an AI-powered platform to help companies turn ESG data into reports that comply with the EU’s landmark sustainability directive – the CSRD – and other voluntary standards.

ESG-X puts a strong emphasis on building a European-first product. The company says its software platform is hosted entirely in German data centres, and its AI is developed in accordance with the European AI Act.

ESG-X marks Dcycle's first acquisition, and will propel its expansion into the German-speaking market, the company said.

“The combination of structured data, artificial intelligence, and an integrated platform is the model that will inevitably dominate the non-financial data market in the coming years,” Mestre said in a press statement. “Our acquisition of ESG-X is a decisive step toward leading that transition in Europe.

Spain-headquartered Dcycle has raised around €10m from investors such as Ship2B Ventures, Angels Capital, Samaipata, Sabadell Venture Capital, Draper B1, and Decelera.

Is sustainability reporting growing up?

Like hordes of over ESG-reporting startups, Dcycle emerged at the start of the 2020s – when capital was abundant and corporates were making bold green commitments.

Since then the landscape has shifted considerably, with a significant drop in venture capital for climate tech – and carbon accounting more specifically – as well as a watering down of corporate sustainability requirements in some places, particularly in the US.

The result has been a rapid consolidation of the carbon accounting space. Dozens of startups have gone bankrupt, but many more have been acquired, as the market divides up the sector’s winners.

Europe’s largest carbon accounting M&A came in January, when UK-based Diginex, a Nasdaq-listed ESG software provider, acquired Plan A in a €55m deal.

Other significant deals include London-based Pledge which was acquired in May last year by American supply chain management company Blue Yonder, and Greenomy, a Belgian sustainability software provider founded in 2020, was acquired by Position Green in September.