Battery startup Our Next Energy Inc. has raised $300 million in a Series B funding round, the company announced Wednesday.
The investment valued the Michigan company at $1.2 billion.
The company will use the funds to build the second phase of its $1.6 billion battery cell factory, which is expected to be completed in 2024, said company founder and CEO Mujeeb Ijaz. car news.
Coupled with a $220 million grant from the state of Michigan, the company known as ONE has now received over $500 million to fund a battery cell plant in Van Buren Township, Michigan. Workers completed construction of the factory exterior in December 2022.
The company’s long-term approach relies on developing batteries that don’t rely on hard-to-find rare-earth elements, relying instead on lithium iron phosphate chemistries. Aijaz, a Ford Motor and A123 Systems veteran, said the technical strategy attracted investors despite the high-interest-rate environment.
To date, ONE has signed 10 customer contracts for its products, totaling 36 GWh over the next five years, he said. In December 2021, ONE put one of his batteries in a Tesla Model S for a trial run. Tesla has achieved his 752 miles of range. By comparison, the longest-range EV ever produced is the Lucid Air, at 520 miles.
Fifth Wall, a venture capital firm primarily known for investing in real estate, led ONE’s Series B round alongside mutual fund firm Franklin Templeton.
Peter Geisch, partner and co-head of Fifth Wall’s climate technology investment team, said: “We are delighted to be part of the growth that defines our category.”
The company focused on growing from startups and raising money from investors seeking equity, Ijaz said.
“We are moving from a venture capital-funded start-up to a growth capital-fueled manufacturer,” Ijaz said. This is important in this environment, where there is an urgent demand for US-based cell manufacturing.”
Series A investors Temasek, Riverstone Holdings, and Coatue also participated in the Series B funding round, while AI Capital Partners, Alpha Intelligence Capital’s US-based fund, Sente Ventures, invested in Istanbul, Turkey’s TR. Worked with PE.
In January 2022, ONE borrowed $62.5 million in convertible notes as part of its Series B funding round. This short-term debt was converted into his one stake in BMW i Ventures, Assembly Ventures, Breakthrough Energy Ventures, Coatue, Flex, and Volta Energy Technologies.
Companies invested in ONE’s Series B round will own about 30% of ONE, Ijaz said.
Franklin Templeton’s investment in ONE’s Series B round includes the appointment of managing director Richard Pilliero to ONE’s board of directors.
As for an upcoming Series C funding round, Ijaz said the company is already working on funding.
“I can’t say anything other than that it will be bigger than this round,” Aijaz said.