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Solcoa Industries raised $75 million in seed equity and debt as it develops a new rare earth metal-making plant, CEO Hooman Reza Nezhad tells Axios Pro exclusively.

Why it matters: Startups, investors and the U.S. government are trying to disrupt China's stranglehold on the rare earth supply chain. 

Follow the money: The $45 million equity raise was led by Bain Capital Ventures, with participation from Gigascale Capital, Long Journey, Felicis, and Dylan Field. 

JPMorgan anchored $30 million in debt and equipment financing.

What's next: The funds will help the company to continue development of its research and pilot manufacturing facility in Alameda, Calif., and to build its 500-ton-per-year plant in Nevada.

The Nevada plant, which will make rare earth metals for the auto and defense sectors, will be "the largest rare earth metallization plant outside of China," says Reza Nezhad, a 20-year-old Canadian who is a former space technology researcher.  

Zoom in: The 500-ton capacity could deliver enough rare earth metals for over a million cars, says Reza Nezhad. 

The company plans to commission its Nevada factory in July 2027, and intends to eventually build a second plant next door that will be able to produce 3,000 tons per year.

How it works: Solcoa has developed a new high-temperature chemical process to produce rare earth metals from raw materials. The company says it's cleaner, more efficient and cost-competitive with conventional methods scaled in China.

Solcoa buys the rare earth materials from countries like France, the U.S. and Malaysia.

Catch up quick: In high school, Reza Nezhad started working on a lab project to use soil on Mars to produce oxygen and metals for future Mars missions. 

The project provided the basis for his ambition to develop rare earths: "If you can reduce different mixtures of oxides on Mars, why can't you do that on Earth?" says Reza Nezhad. 

He moved to the Bay Area at 18 to co-found Solcoa and raise funds. 

Solcoa's co-founder and CTO is 22-year-old Worcester Polytechnic Institute researcher Artem Iurkovskyi.

The big picture: China's suspension last year of rare earth metal and magnet exports drove a surge in investor and entrepreneurial interest in startups offering rare earth mineral innovations.

The U.S. government has also ramped up support of a domestic rare earth supply chain. 

Rare earth metals are used in machines that move or generate electricity, like generators, electric motors, fighter jets, wind turbines, phones and data centers. 

"They're the foundation of a lot of modern technology," explains Reza Nezhad.

Exclusive: Solcoa Industries raises $75M for rare earth metal plant

Startups are trying to disrupt China's stranglehold on the rare earth supply chain.

A person in a white lab coat and blue gloves leans over a metal cabinet, reaching toward it in an industrial setting; blurred background shows machinery and a motor.

A Solcoa employee loads rare earth oxide feedstock into processing equipment at the company's Alameda, Calif., facility. Photo: Courtesy of Solcoa Industries.

Solcoa Industries raised $75 million in seed equity and debt as it develops a new rare earth metal-making plant, CEO Hooman Reza Nezhad tells Axios Pro exclusively.Why it matters: Startups, investors and the U.S. government are trying to disrupt China&#x27;s stranglehold on the rare earth supply chain.

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Exclusive: Solcoa Industries raises $75M for rare earth metal plant

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