Woodinville, Wash.-based Group14 Technologies has raised $400 million in venture capital that will supercharge the commercialization of its battery technology.
The Series C round was led by Porsche AG, which plans to use the company’s technology in some of its electric vehicles. Group14 has developed a silicon-carbon composite material that can replace the graphite anodes in lithium-ion batteries, improving their performance by 50% and providing faster recharging times.
While Porsche is the first publicly announced customer, the technology can boost lithium battery performance across applications and the company is working with aviation companies and consumer electronics manufacturers as well.
“We’ve proven the technology and proven it across 40 different customers,” said CEO and co-founder Rick Luebbe. “And now the pressure is on us to support the demand we see. The demand for this is a fantastic. And so we have to build production capacity as quickly as possible to keep up. We’re really going to lead the transformation into the silicon battery industry.”
Group14 launched in 2015, but Luebbe’s work in this space dates back much farther. The startup spun out of EnerG2, a University of Washington spinoff that Luebbe co-founded in 2003 and was acquired by German chemical company BASF.
Group14 previously raised $41 million in venture capital and funding from the U.S. Department of Energy.
Other participants in this latest round include OMERS Capital Markets, Decarbonization Partners (a partnership between Temasek and BlackRock), Riverstone Holdings LLC, Vsquared Ventures and Moore Strategic Ventures.
The round is the largest VC investment to be announced so far this year in Washington state. Group14 did not share the company’s current valuation.
The new funding will help build a manufacturing facility in Eastern Washington’s Moses Lake that should come online in the second half of next year. Group14 already has a facility in that area that’s working on engineering and R&D. Luebbe said he likes the location because there’s lots of land, a good labor pool and access to clean, affordable hydro-power.
“It’s kind of an ideal location and, frankly, not just for us,” Luebbe said. “I think Moses Lake is going to be a center of battery ecosystems.”
The company is also developing a joint factory with SK Group in South Korea that is scheduled to start operating later this year. Group14’s headquarters in Woodinville includes manufacturing and R&D. The 90-employee company has new jobs available across its facilities.
The demand for better batteries is being driven by efforts worldwide to shift to electrification and away from the consumption of fossil fuels that are warming the planet. Porsche recently announced that it’s aiming for 80% of its new vehicles to be all-electric by 2030.
Group14 is working with Cellforce Group, a Porsche subsidiary, to incorporate the technology. Cellforce plans by 2024 to start producing lithium-silicon battery cells in a plant in South Germany for use in Porsche EVs.
“The battery cells are the combustion chamber of the future,” said Lutz Meschke, deputy chairman and member of the executive board of Finance and IT at Porsche AG, in a statement.
The technology costs more, Luebbe said, but because it packs more power into fewer battery cells, that offers some savings. And the technology can be relatively easily adopted by battery manufacturers.
“You don’t have to buy any new equipment. You don’t have to retrain anybody,” he said. “All you have to do is have a slightly different recipe for what goes in that slurry mixture.”