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Gates-backed battery maker files for bankruptcy

Illustration of a frowny face with "11" as the eyes.

Illustration: Shoshana Gordon/Axios

A tough fundraising climate was among the issues next-gen battery developer Ambri cited in its bankruptcy filing.

Why it matters: Capital-intensive climate tech startups like battery makers remain vulnerable to the broad pullback in venture funding.

Zoom in: Bill Gates-backed Ambri, which is working on a liquid metal battery, says investors pulled out of key fundraising processes last year, eventually leading to liquidity issues building out its manufacturing facility.

  • The company says it plans to sell itself to existing noteholders, including firms associated with Gates and hedge fund investor John Paulson, unless it gets a better offer via an auction.
  • The noteholders will make an initial bid worth $38 million using debt owed to them.
  • The Marlborough, Mass., company said in court filings that it will halt its plans for manufacturing and refocus on R&D and licensing.

Catch up quick: The company had early funding from Gates and ARPA-E and raised millions of dollars from investors over the years including VC firm Khosla Ventures, energy company Total, and Indian conglomerate Reliance.

  • It closed an almost $150 million Series E round in 2021 and planned to raise $300 million in 2023, which was halted.
  • Co-founded by MIT professor Don Sadoway and researcher David Bradwell, Ambri aimed to commercialize a long-duration battery for grid storage using new chemistry.
  • It partnered with big names on pilot deployments like Microsoft and Xcel Energy.

The big picture: Commercialization of the tech was pushed back over the years due to engineering hurdles.

  • New battery chemistries are incredibly hard to commercialize, and the sector is littered with failed startups that couldn't move from the lab into manufacturing.
  • The success story that is lithium-ion batteries benefited from many decades of investment and research by Asian battery conglomerates.

The bottom line: Ambri is not alone in the challenges that the market reset delivered, causing cratered valuations, high costs of borrowing and a lack of investor support.

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