Exclusive: Solcoa Industries raises $75M for rare earth metal plant
A Solcoa employee loads rare earth oxide feedstock into processing equipment at the company's Alameda, Calif., facility. Photo: Courtesy of Solcoa Industries.
Solcoa Industries raised $75 million in seed equity and debt as it develops a new rare earth metal making plant, CEO Hooman Reza Nezhad tells Axios Pro exclusively.
Why it matters: Startups, investors and the U.S. government are trying to disrupt China's stranglehold on the rare earth supply chain.
Follow the money: The $45 million equity raise was led by Bain Capital Ventures, with participation from Gigascale Capital, Long Journey, Felicis, and Dylan Field.
- JPMorgan anchored $30 million in debt and equipment financing.
What's next: The funds will help the company to continue development of its research and pilot manufacturing facility in Alameda, Calif., and to build its 500-ton-per-year plant in Nevada.
- The Nevada plant, which will make rare earth metals for the auto and defense sectors, will be "the largest rare earth metallization plant outside of China," says Reza Nezhad, a 20-year-old Canadian who is a former space technology researcher.
Zoom in: The 500-ton capacity could deliver enough rare earth metals for over a million cars, says Reza Nezhad.
- The company plans to commission its Nevada factory in July 2027, and intends to eventually build a second plant next door that will be able to produce 3,000 tons per year.
How it works: Solcoa has developed a new high-temperature chemical process to produce rare earth metals from raw materials. The company says it's cleaner, more efficient and cost-competitive with conventional methods scaled in China.
- Solcoa buys the rare earth materials from countries like France, the U.S. and Malaysia.
Catch up quick: In high school, Reza Nezhad started working on a lab project to use soil on Mars to produce oxygen and metals for future Mars missions.
- The project provided the basis for his ambition to develop rare earths: "If you can reduce different mixtures of oxides on Mars, why can't you do that on Earth?" says Reza Nezhad.
- He moved to the Bay Area at 18 to co-found Solcoa and raise funds.
- Solcoa's co-founder and CTO is 22-year-old Worcester Polytechnic Institute researcher Artem Iurkovskyi.
The big picture: China's suspension last year of rare earth metal and magnet exports drove a surge in investor and entrepreneurial interest in startups offering rare earth mineral innovations.
- The U.S. government has also ramped up support of a domestic rare earth supply chain.
- Rare earth metals are used in machines that move or generate electricity, like generators, electric motors, fighter jets, wind turbines, phones and data centers.
- "They're the foundation of a lot of modern technology," explains Reza Nezhad.
