Dive Brief:
- Niron Magnetics, a startup specializing in rare earth-free permanent magnets, raised a $25 million funding round, the company announced on Feb. 20.
- Samsung Ventures led the funding round with participation from automotive supplier Magna and Allison Ventures, the venture capital arm of supplier Allison Transmission.
- Niron will use the funding to expand its pilot production facilities, boost magnet production and accelerate its research and development activities.
Dive Insight:
The Minnesota-based company is also backed by three major automakers: General Motors, Stellantis and Volvo Cars. The venture capital arms of GM and Stellantis participated in a $33 million funding round for Niron Magnetics last November.
Niron says its magnets can help automakers build more sustainable electric vehicles, as its permanent magnets do not contain rare earth metals such as neodymium,dysprosium, terbium and praseodymium. The company’s magnets also have the potential to lessen the auto industry’s reliance on China, which processes around 70% of rare earths.
“Allison Ventures was launched to drive innovations that will shape the future of commercial-duty mobility,” said Mike Foster, chief technology officer of Allison Transmission, in a press release. “We believe solutions like Niron’s Clean Earth Magnet are needed to address the global demand and supply risks of rare-earth elements needed for electric motors and other critical applications.”
Unlike traditional magnets, Niron’s rare earth-free magnets are made using iron nitride, which is a mixture of iron and nitrogen that’s inexpensive and abundant. Iron nitride magnets cost around 50% less than rare earth magnets, according to Niron, which could make EVs more affordable.
Shakopee Mdewakanton Sioux Community and the University of Minnesota, both current investors, also participated in the funding round.
