Redwood Materials, a company focused on developing a sustainable, circular battery supply chain, has been developing solutions to recycle, refurbish, refine and remanufacture sustainable battery materials. The company, founded by JB Straubel – who co-founded Tesla (TSLA) -) – said Tuesday that it has raised more than $1 billion in a Series D investment round led by Goldman Sachs.
The company has now raised a total of almost $2 billion of equity capital, in addition to a $2 billion loan commitment from the Department of Energy.
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“As the electrification megatrend continues to accelerate, building a local sustainable battery materials supply chain is more important now than ever," Goldman Sachs' managing director in private equity Sebastien Gagnon said in a statement. "We believe the Redwood team is well-positioned to become a leader in the battery materials industry."
Gene Munster, Deepwater Management's managing partner, thinks that, in the wake of this investment round, Redwood is poised to become a powerful force in the tech world.
"I believe this is the biggest equity raise in battery tech. On top of that it was done in a tough fund raising environment," Munster said. "I believe it's on track to become a foundational tech company."
Noting that Deepwater partook in the investment round, Munster said that Redwood's coming dominance can be broken down to three reasons. First, it "is the only company building a closed-loop battery materials supply chain in the U.S." Second, Redwood is working with a total of $4 billion in available capital.
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And third, Redwood has a "leadership team that knows how to build a massive tech company."
Beyond Straubel – who Munster referred to as "one of the most knowledgeable people in the world when it comes to battery tech" – Colin Campbell, who spent 17 years heading up Tesla's powertrain development, serves as Redwood's CTO.
Kevin Kassekert, Redwood's COO, is another Tesla veteran; he spent seven years as VP of people & places and director of infrastructure operations.
The company is planning to use this latest funding round to expand its U.S. operations.
"Redwood’s vision, leadership, and execution places it at the forefront in this emerging sector," Joe Fath, a T. Rowe Price Associates portfolio manager said. "With its commitment to creating a sustainable battery materials supply chain, we believe Redwood can be a durable growth company and help catalyze the next phase of clean energy adoption and deployment.”
