EV Batteries

VCs invest nearly $650 million for automotive-related startups

More than 70% went to battery tech companies, and one in particular raised $300 million.
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Battery tech may be one of the hottest automotive investments this winter—at least according to VC dollars.

Venture capitalists invested more than $647 million in automotive industry startups in February, and more than 70% of that funding went to battery tech companies, Automotive News reported.

Fully charged

The biggest bet in that sector was Our Next Energy, a Michigan-based energy storage company that netted a $300 million Series B at a post-money valuation of $1.2 billion.

The funding round came alongside an additional $220 million in grants from the State of Michigan. One of the company’s goals is to produce enough LFP batteries to power 200,000 electric vehicles by 2027, the FT reported.

Why it matters: LFP batteries are widely seen as a smart way to power EVs since they’re less expensive to manufacture than some methods and provide faster vehicle charging.

But the tech is a relatively new manufacturing bet for the US. In 2022, LFPs represented about half the battery capacity of EVs sold in China, compared to only 9% for the US—and that’s up from zero for the US in 2021, according to research from Adamas Intelligence cited by the FT. When Our Next Energy completes its factory, chances are that number will grow even larger.—HF

Keep up with the innovative tech transforming business

Tech Brew keeps business leaders up-to-date on the latest innovations, automation advances, policy shifts, and more, so they can make informed decisions about tech.