Bridging the Battery "Valley of Death"

It can take a decade to develop a viable proof of concept, and having money helps.

A short reel on recent US startups receiving funding. If you enjoy this newsletter please give us a share and subscribe! For enquiries, reach out at intercalationstation@gmail.com.


Several startups (Sila Nanotechnologies, 24M, Ionic Materials, Natron Energy, Cuberg, Feasible, Noon Energy, and Sepion Technologies) have recently received grant funding to continue commercializing their battery tech.

As the market grows, more researchers will — with encouragement from universities — contemplate taking their battery innovations from the lab bench into the real world. Delivering new battery technologies is a challenge: “Materials are tricky beasts … development takes patience and time and money” according to Kristin Persson from Berkeley Lab. Indeed it can take upwards of a decade to develop a viable proof of concept, and it is a journey fraught with death traps.

You can’t have your cake and eat it too with battery tech. Dan Steingart, from Columbia University, aptly describes performance tradeoffs as an “unfortunate tetrahedron”.

Despite what companies may claim, there are no silver-bullet solutions, and traditional investors aren’t a fan. Typical VCs prefer working tech and revenue projections before they deploy capital, which is difficult for fresh spinouts. For later-stage startups, additional funds are often needed to establish real-world scale. Still, entrepreneurs are lining up to traverse the “Valley of Death” and capture a portion of the $71B lithium-ion battery market. While government research grants focus on fundamental development, other funding bodies have positioned themselves to bridge the commercialization process perceived to be too early and risky for traditional investors. 


Seeding Critical Advances for Leading Energy technologies with Untapped Potential (SCALEUP)

ARPA-E’s SCALEUP is one initiative that enables companies to seed critical advances for leading energy technologies with untapped potential

“SCALEUP supports the scaling of high-risk and potentially disruptive new technologies across the full spectrum of energy applications. The goal of the program is to translate the performance achieved at the lab- and bench-scale by previously funded ARPA-E technologies to commercial viability, supporting promising energy technologies that require scaling-up or pre-pilot projects to enable a path to market and ultimately lead to realized commercial impact.” 

In February 2021, the program announced a total of $47m in funding, with $27m going to battery startups in the United States. Here are some of the projects that got funded: 

  • Sila Nanotechnologies ($10 million): Sila (Alameda, California) has had a tremendously successful year, raising $590 million to fund their battery materials factory. SCALEUP will support a portfolio of novel technologies around advanced reactor designs to enable efficient materials processing, diagnostics, precursor utilization, and materials handling. 

  • 24M ($9 million): This month, 24M (Cambridge, Massachusetts) inked a licensing deal with Norweigian battery cell factory Freyr to manufacture 24M’s SemiSolid cathodes, aiming for 40Gwh by 2025. With SCALEUP, 24M will also develop their Lithium Electrode Sub-Assembly and SemiSolid cathodes for lower-cost energy storage (<70 $/kWh), superior power (>1.5 kW/kg), and improved energy density (450 Wh/kg). The team will work on a 1 MWh/y pilot line for customer validation, on the exciting path to demonstrating lithium metal batteries for electric aircrafts. 

  • Ionic Materials ($8 million): Ionic Materials (Woburn, Massachusetts) will continue development to a high-volume, commercial-quality polymer electrolyte. The team will drive towards a 15% reduction in production cost and receive third-party qualification to test their electrolyte in automotive Li-ion cells. 

ARPA-E developed a “Fast-Track” program in late 2020 in response to investment disruptions due to COVID-19.

  • Natron Energy ($20 million): The project aims to scale up Prussian blue electrode sodium ion batteries by 30x and de-risk the supply chain by adopting industry-standard chemical synthesis and battery manufacturing equipment to produce Natron’s cells. 

Twitter avatar for @ARPAEARPA-E @ARPAE
Recently, @cenmag named Natron Energy one of its 10 startups to watch for 2020 – but earlier this year Natron was selected as part of our ⬆️SCALEUP⬆️ program’s “fast-track” to support the commercialization of their sodium-ion battery tech! Learn more:
arpa-e.energy.gov/news-and-media…

C&EN @cenmag

Working toward a better future using the power of chemistry, meet @cenmag’s 2020 #10StartUpsToWatch: @aryballe, @culturebiosci, @cygnaltx, @futureofapparel, @Lilac_Solutions, @Proterabio, @Ventus_Tx, @ZapataComputing, Lycia Therapeutics and Natron Energy! https://t.co/ooqWMjdgPp https://t.co/8vGQrZ7EVH

In California, The California Energy Commission (CEC) is another program that attempts to bridge the valley of death. They awarded ~$10 million in February 2021 as part of its Bringing Rapid Innovation Development to Green Energy (BRIDGE) grant:

  • Cuberg ($3.5 million): Cuberg is a Stanford spinout working on lithium metal batteries. The CEC grant will support its battery cell maturation and battery module developments for the electric aviation industry. Most recently they were also acquired by European gigafactory developers Northvolt.

  • Feasible Inc ($1 million): Feasible is working on advanced battery inspection and metrology with ultrasound and machine learning (EchoStat™ Platform), and the grant will be used for scaling up and validating its product in battery manufacturing. 

  • Noon Energy ($2.2 million): Noon Energy is pioneering a flow battery technology that enables economical long-duration energy storage. The grant will support a pilot of its low-cost, long-duration energy storage system. 

  • Sepion Technologies ($1.4 million): Sepion develops highly tunable nanoscale membranes for multiple industrial markets including batteries, electrowinning, and water treatment. The grant will be used to extend cycle life and boost the safety of lithium-metal batteries for electric transportation.


The ARPA model as a template

Supporting high-risk high-reward science has been successful for American science entrepreneurship, and it is a model to be replicated. The UK government is adopting several strategies from ARPA in their own Advanced Research & Invention Agency (ARIA). The program will be initially funded with £800M with a focus on:

  • High-risk research

  • Strategic, scientific, and cultural autonomy

  • Investing in the judgement of talented people (i.e. “programme managers”)

  • Financial flexibility and operational freedom

“ARIA will unleash our most inspirational scientists and inventors, empowering them with the freedom to drive forward their scientific vision and explore game-changing new ideas at a speed like never before. This will help to create new inventions, technologies and industries that will truly cement the UK’s status as a global science superpower.” - Science and Innovation Minister Amanda Solloway.


Joint ventures often go global

While US battery startups gain a lot of attention for their technological innovations, they often partner with companies to leverage their manufacturing capabilities.

This is ‘division of labor’ on a global scale, largely enabled by programs like ARPA. For example: in the past month, Cuberg (Stanford battery startup) was acquired by Northvolt (Swedish manufacturing), and 24M (MIT battery startup) working with FREYR (Norwegian manufacturing).

Listing out some examples…

  • Cuberg (US 🇺🇸) + Northvolt (Sweden 🇸🇪)

  • 24M (US 🇺🇸) + FREYR (Norway 🇳🇴)

  • Quantumscape (US 🇺🇸) + Volkswagen (Germany🇩🇪)

  • Sila Nano (US 🇺🇸) + Daimler (Germany🇩🇪)

  • SolidEnergy (US 🇺🇸) + General Motors (US🇺🇸)

  • PolyPlus (US 🇺🇸) + SK Innovation (Korea🇰🇷)

  • Seeo (US 🇺🇸) + Bosch (Germany🇩🇪)

  • Satki3 (US 🇺🇸) + Dyson (UK🇬🇧)


The “Valley of Death” is an oversimplification.

In reality, it is one big valley composed of several valleys, each with different sizes and challenges dependent on the specific battery technology the company is working on. In a perpetually evolving scientific baseline and a rapidly expanding battery industry, it is promising to see bridging programs like SCALEUP, BRIDGE, and FAST-TRACK. It is critical for more investors and agencies to fund in this valley of death to deliver scalable energy solutions for the electric future to come.


🎧 WHAT WE’RE READING/LISTENING TO

  1. Cell Siders Podcast - a look at the business and technology of batteries.

  2. The Mobilist: Will Biden’s Plan Jumpstart a U.S. Battery Industry?

  3. Aionics Fortnightly: battery-related talks hosted by software solutions and consulting company Aionics

  4. FT: Investors see ‘gold rush on steroids’ for green battery metals


🚀 STARTUP MOVEMENT TRACKER

  1. Lilium (Germany) to list on US stock market via SPAC

  2. Oyika (Singapore) raises $100m for battery swap business

  3. Lightyear (Netherlands) raises $40m for solar EVs

  4. Betteries (Berlin) raises $2.1m seed funding for EV battery upcycling

  5. ChargerHelp! (Los Angeles) raises $2.75m for EV charger repair

  6. Nanom (Iceland) raises $3m for new nanomaterials


🌞 THANKS FOR READING!

If you enjoy this newsletter or know someone who would, please subscribe. For tips, feedback, or business enquiries, please email intercalationstation@gmail.com.

About the writers:

Andrew is a PhD researcher at the University of Oxford (@ndrewwang). Nicholas is a business manager at UCL Business and Venture Fellow with Berkeley SkyDeck (@nicholasyiu). Ethan is a battery scientist with experience at startups, research labs, and EV manufacturers across the world (@ethandalter).