S2 E75: America Doesn’t Have to Buy Magnets From China Anymore | Niron Magnetics

Dustin Olsen (00:41)
Hi everyone, welcome to the Rare Earth Exchanges Podcast. I'm your host, Dustin, joined by my co host Daniel, and our today's guest is Tom Granger, who is the vice president of commercial and corporate development in Niron Magnetics. Niron Magnetics is a Minneapolis based advanced materials company and has developed the first high performance rare earth free permanent magnet using iron nitride. Tom, welcome to the show. How you doing?

Tom Grainger (01:09)
Eight, doing well and great to be here. Excited.

Dustin Olsen (01:13)
Yeah, we're excited to have you too. We've been ⁓ as we're talking before the show started, we've been following your company pretty much since we started. we're really impressed with what you guys are doing. so Tom, first question to kick this off is

Can we get into nyron specifically and to help our listeners understand why the n iron nitride is a significant material for what you guys are doing?

Tom Grainger (01:38)
A hundred percent. So iron nitride, ⁓ that is the magnetic material that we make at Niron Magnetics, and that's the the cute name, N for nitrogen, and then iron Niron. it is the first credible, scalable alternative to rare earth-free magnets to enter the market, and the first novel magnetic material in decades. So why that's significant for the listeners to your podcast will know.

Magnets go into pretty well everything where you're turning electricity into motion or motion into electricity. The rare earth dependence today is a supply chain risk, which is why we have all of these efforts to stand up Western supply chains and find alternatives. And so iron nitride is the alternative that is commercial today.

in that the magnets are being made, ⁓ the process has been honed, and that's the result of decades of work, and for Nyron specifically, over a decade of work, coming to fruition. And given sort of the state of the world in the market, the timing is very good.

Dustin Olsen (02:44)
that's really interesting. I so I'm I feel like I've been saying it wrong. Nitrate or nitride?

Tom Grainger (02:50)
I tried, and that many have tried.

Daniel O'Connor (02:53)
the

Dustin Olsen (02:57)
Perfect. So Tom, your part of your background is you came from the the Boston Consulting Group where you specialized in launching new business units from ideation through first sales. So now you're in the rare earth space. And then how did you apply commercialization, that playbook to what you're doing with Nylon?

Tom Grainger (03:19)
My personal journey to Nyron harkens back prior to being on the the very corporate management consulting side of things. I was educated as an electric machine designer. And so the devices that magnets go into and power. And you know, as of prior to Nyron, there's been a very limited and very dated set of ingredients that machine designers can cook with.

And so as I was searching for a journey to sort of transition from Boston Consulting Group and work on commercializing something I could stick with and sort of see through to the end, I was talking to folks who invest in the space and said, Can you name a few companies where, and this is as of 2021, it's not clear yet that they're gonna make it. But if they do what they say they're gonna do, no question, it's game-changing.

And credit to them, two different folks independently pointed me towards Nyron, and I was immediately on the hook.

Just recognizing as somebody who has designed electric machines, you know, what does it mean when you give chefs who have been working with four ingredients for years a fifth ingredient? Like, no matter what the quality or nature of that ingredient, like something new and useful is gonna come from that. And then the more I learned about iron nitride and its properties, I was like, and this is a good ingredient. and so that's what got me here.

To your point around launching and commercializing that new product, like from ideation to first sales, these paradigm shifts tend to be marketed and talked about in terms of disruption and innovation. But at the end of the day, like customers focus on

risk reduction or a benefit. Like that's that's where people really lock in. ⁓ when somebody is looking for supply chain security, the word that comes to mind is not disruption. That's the word they're trying to avoid. And so

The approach has been work with customers basically on the problem that they're facing. And Nyron operated for a long time quietly, in stealth mode, with a very small number of employees, until before we spent even a dime on scaling for that exact purpose.

Like a s mistake that a lot of folks made in another material supply chain batteries is they jumped before the product was ready. And at NYRON we've been really diligent about not jumping before that product is ready. And our definition of ready is it's something that a customer, you know, has designed in to their device. And they say, hey, the faster you can scale, the better.

Daniel O'Connor (05:48)
It's a great, it's a very important company. again, when we launched Rare Earth Exchanges, formerly as a company January 2025, we were already really tracking your company because we understood that the West or ex-China is in a very precarious situation. And the

probably the most logical pathway to get out of that situation is to innovate our way out of it. And so that's what brought awareness of your company. Before we get into some other questions, I wanted to get a better sense of the technology itself, where it comes from. Was it a university? Could you maybe just take a couple minutes and explain the genesis to the extent you can?

Tom Grainger (06:34)
Yeah. As a material, folks have known about iron nitride since the nineteen fifties. So the compound the magnetic phase of iron nitride, which is the alpha double prime Fe sixteen N two phase.

Or those who are feel so compelled to get into the specifics. But that was discovered at Cambridge University and it came out of steel hardening. People were looking at nitrogen as a way of hardening steel casing. and it coincidentally it was magnetic. And so the crystal structure was identified, but the ability to produce that any sort of pure phase was sort of an area of academic curiosity for many years. And there was work in the 70s in Japan.

And then work by the actually the son of that lead researcher in the 90s in Japan to try to prove what had been reported very inconsistently as this giant saturation magnetization. So, really, like the magnetic potential of the material. And if that potential was real, this was potentially the holy grail of magnetic materials, but the results were inconsistent and very much limited by the technology of the time.

And so two things came together around 2010. ⁓ you know, kind of supply and demand side. Demand side, that was a when we had the ⁓ first rare earth crisis. And so trade dispute between China and Japan. This is sort of well-trodden territory for those who are real rare earth heads. but it was a restriction in selling magnets and rare earth materials.

That sort of the shock waves were felt around the world of governments who had not realized the level of concentrated geopolitical dependence on China suddenly realized it. Like rares prices shot up five to ten X, people realized that they had a single source of failure for a critical component. And what that launched within the US government.

Was the ARPA E React program. ARPA E being the energy program's Department of Energy's version of DARPA, like the famous defense program that launched the internet and lasers and many other strange and wonderful things. The Department of Energy had taken that model and was looking for some first program to deploy it against. And so Rare Earth Alternatives for Critical Technologies, or React, which is what they did to the trade dispute, funded a number of universities.

across the US, as well as national lab institutions, to take a crack at determining rare earth alternatives for critical technologies.

One of those was the University of Minnesota, and this is where the supply side comes in. A researcher there, Dr. Zhang Ping Wong, had been working on magnetic materials. There is a last bastion of magnetic materials expertise in the US that comes out of the hard disk drive industry because of magnetic memory. So the magnetic physics component, the first thing you have to understand to launch a new material, there are research groups, and there'd been a particular interest.

In iron nitride is this mystery nobody could crack. And it had been recently enabled by just new advances in advanced characterization technology. What you couldn't measure in the 90s, you suddenly could measure in 2010. So that grant came together with that research, and the result was, for the first time, empirical physical evidence proof of iron nitride's giant saturation magnetization. It's a technical way of saying.

My goodness, this is the most magnetic material known to science. and that that was Yeah. What came out of it was founding the company and a long pathway to go from we know this is the thing we want to make, to and how do you make it? And how do you make it economically, and how do you make it at scale? So that's been the journey since.

Daniel O'Connor (10:00)
Wow. Wow. Amazing.

So. ⁓

Fascinating and and that's probably why it's in the Minneapolis Twin Cities area because of the Minnesota connection the University

Tom Grainger (10:29)
We are a proud

alumni of the University of Minnesota.

Daniel O'Connor (10:33)
Yeah. Which, by the way, Minneapolis-St. Paul has a lot of innovation. Medical devices, software, I mean, it's not known like Silicon Valley, but it's a very innovative place, the region.

Tom Grainger (10:49)
And something I think you'd appreciate is there's sort of when I joined Nyron, coming from a machine design background and a business background, ⁓ both of which are relatively abundant versus a Magnetics background. There were electric machine designers being hired and trained by all the different automotive players at the time. Business folks are a dime a dozen, I'm pointing at myself. But Magnetics talent I thought was going to be a real problem. Like there is no Magnetics pool of talent in the US.

That has not been a problem for NIRON. It's been somewhat the opposite, where we've got these two ingredients, which is the local potential, like you said. 3M is headquartered in the Twin Cities, Seagate is headquartered in the Twin Cities doing all the hard disk drives, Honeywell has major operations there. There is this manufacturing heartland where there's a lot of material science expertise. And then you take those talented, young to mid-career individuals.

And mix them with what I've described as the Oceans 11 strategy, where the original kind of founders of the Magnetics industry in the US are largely nearing retirement age. And we have done the roundup and said one last job. And so folks who both started the US Magnetics industry were part, just as doing the job of that industry's exodus to China, have chosen rather than retire, which they're in the fortunate position to be able to do so.

To do a victory lap in bringing magnetic manufacturing back to the US with this first new material in decades. And so I can show Tony Morkos and Jeff Calvert as individuals who were at the original Magnaquench operations in the US and are helping train up the next generation of American Magnetics leaders.

Daniel O'Connor (12:38)
Amazing story.

Dustin Olsen (12:38)
It's really exciting.

Yeah, truly.

⁓ I do have a question though, Tom, as you've been talking about the the material, the product, what you guys have staked the company's reputation on is a rare earth free alternative. So the industry question is can it perform against ⁓ neodymium magnets, these permanent magnets? how do how do you support that?

Tom Grainger (13:07)
It's the right question to ask, and it's usually the first question that customers ask when they come our way, which is good. ⁓ if they didn't, that would be ⁓ the they'd be sc be burying the lead. So the the most common grade of rare earth magnet we replace is a niodymium ion boron grade, and it's an N forty two SH permanent magnet.

And so that usually just easy to snap into the existing framework where people are more familiar with neodymium. It's sort of a workhorse grade for industrial motors, for automotive motors, and then used broadly. And what usually brings people over the line on does it work? is we're now in a position to just show them the motors. at the end of the day.

Every magnetic metric is in service of the performance of the device. And so, like if you take a tier one like a magna or an OEM like a GM or Stellantis, what they are benchmarking themselves against are torque, speed, efficiency, and that's the language in which they operate. And so does the magnet enable you to produce a device in your automotive or defense or industrial end market that does.

the job and does so economically and

There used to be a lot more steps of explaining. ⁓ we're now at a stage where we can share motor results that speak for themselves, or you know, in some of the industries where we're just breaking in at a minimum simulations. And so a lot of that is gonna be shared publicly later this year. You could imagine when we do those with customers, they keep their product roadmaps pretty close to their chest. And so ⁓ as part of our 2026 product marketing, ⁓ some of the you know

NYRON and partner examples that can be shared publicly are going to be unveiled. So it's gonna be an exciting back half of the year.

Dustin Olsen (14:58)
That's awesome.

Daniel O'Connor (14:59)
I was going to mention ⁓ both Dustin and Tom that we recently did a deep dive into the automobile supply chain and Tom, I was really surprised how much innovation, how much investigation at least, these supply chain players, big ones, are doing to diversify away from

rare earth centered magnets, for example. It surprised me how far they were getting. There's still some time to go, but there's clearly a movement afoot. from that perspective, have you all, are there certain industries that are more conducive to or classes of product that are more conducive to rare earth free magnets? Or is it?

not so much an industry thing, it's more of a functionality thing.

Tom Grainger (15:51)
It's it's a the right question and functionality translates into a subset of industries. there's also a component of like we're making iron nitride magnets today. I should there you go. We're making iron nitride magnets today. So you can see one there with its lovely nickel plating. And the pull test is difficult. I'm not a guitarist or a rock climber, so my grip strength is probably not represented test, but the magnet sticks are better.

But the the places that we're we're focused, and I'll also walk through that strategy is rare earth-free magnets are compelling in a diverse array of applications. and as you think about the neodymium market as a whole today, and just the market entry iron nitrides, what I was showing you there, what's produced from our pilot manufacturing mini facility in Minneapolis already.

So 30 to 40 percent of applications, there's a ticks and ties, checkboxes down the list, technical and economic case for adopting a rare earth-free solution outside of your supply chain constraints. And then

For sort of expand that to 60 to 70% of the market for neodymium magnets today. There is a a technical case that can be that is made, is technically compelling, it delivers what you need. but you're looking to a subsequent generation of iron nitride unless you're willing to pay like a modest premium for that system, but you know, you don't want to count on that as your business case. And so, and that remaining third, additional grades of iron nitride will continue to

you know, create viability for that. ⁓ but the magnets today aren't focused there. And so what I'll I'll sort of share is either of you guys, you know, film buffs.

Daniel O'Connor (17:36)
Yeah, sure.

Dustin Olsen (17:37)
I enjoy a good

movie.

Tom Grainger (17:38)
Okay. Well, it's it's a big part of my podcast diet outside of rare earths. That's how I keep it fresh.

And so a concept that we use within Nyron is sort of what is the log line for a customer program? What the log line is the one to two sentence summary of a film that you use to sort of convey the idea or to get somebody hooked on actually reading the full script, which, like a customer relationship, is much more rich and diverse and complex. And so like the the godfather, for example, is you know, an aging patriarch of a crime family is looking to hand over his dynasty to a hesitant son. Like

whole thing in a package. So we will take a customer say a customer specific relationship and say what's the log line? And an example in mobility is performance related. And so this speaks to where is there a checks down the list technoeconomic case. And that is a a customer program where their log line would read, you know by integrating iron nitride magnets into our motor design,

we will deliver the most efficient electric traction motor on the market.

And so you take away all of the geopolitical constraints, and that is still a really exciting movie. Like you are going to read that script and you're going to execute from there. And so there's work we've announced with various OEMs. Like a public one is we're doing work on variable flux motors with Stellantis. We've also been public about licensing some of the core IP in that space. There are these new technologies that I said this new ingredient unlocks that push the boundaries of what has been possible for automotive.

and micromobility, so think e-bikes, Uber Eats, the bikes that are buzzing around India and in so many of their mobility segments.

And the other side is there are segments where it is really about that supply chain security. And like the another example of a log line would read, you know, we are setting two different actuators for missile fins down in front of like the US military decision maker for service to air missile systems. And one of them we will say is dependent on China and the other one is not. Which one would you like? Like that's that's their their log line. And that sits in a segment where you know the

Daniel O'Connor (19:40)
Okay.

Tom Grainger (19:51)
First magnetic material is within 10% of that full technoeconomic case, but you do have to take that leap to adopt it today. The magnets that are tracking to be you know productized and released in 12 months, the leap of faith is you know the gap is closed.

But we're getting pull from customers who are sort of

supply chain risk off. And like you said, it's surprising how deep some folks have gone. And I really think for automotive the chip shortages taught a lesson and people moved from just in time to just in case supply chains. In defense,

Daniel O'Connor (20:26)
Yeah.

Tom Grainger (20:28)
we're seeing that with the the D FARS restrictions as well as

You know, as as there's more active military conflict around the world, stockpiles are being depleted, and the export restrictions from China do prohibit those rare earths from getting into the hands of any foreign military, you know, not just the US. And so those pressures are coming together, and the initial markets markets we were targeting have expanded based on just customer pull versus Niron push.

Daniel O'Connor (20:56)
Well, it's interesting on that note, I don't know and love the film analogies by the way and You know oceans 11. That's classic. I just wonder who's George Clooney in your

in your shop. you know, Crossing the Chasm is a very important book. Have you read that book?

Tom Grainger (21:11)
You've got me on video, so you know it's not me.

Dustin Olsen (21:14)
Ha ha.

Tom Grainger (21:27)
I'm familiar. I have, I must admit, read the blogs inspired by that book.

Daniel O'Connor (21:28)
It's.

It's a Silicon Valley must-read and it's really about technology, marketing, and adoption. So it'd be really intriguing for me to read it again and think about rare earth-free magnets because it's all about early adopters, visionaries, early adopters, pragmatists, and then the conservative buyers, right? And the conservative buyers really, like it's very hard for them to change. So it's sort of a segmentation.

And then for you as a company, what you have to do according to that framework is you might be focusing on early adopters right now, but your case studies, your documentation, all the evidence that you're putting together is really meant to be for that more pragmatist group that's kind of hesitant, they're conservative.

We don't want disruption, right? But we can't be dependent on a state regime monopolist either. That's an adversary.

⁓ Anyway, some thoughts. Dustin, I know we have some more questions. I had one or two more, but please proceed.

Dustin Olsen (22:40)
Mm.

Yeah. I g have some thoughts. So Tom, recently on our show we had a guest called Jack Lifton who has been in the industry, has worked with the OEMs automotive for sure, in his career. And seeing as hell that's a market you guys are going after as well, I'm curious what sort of testing longevity have you guys done to prove to these automotive OEMs that you're

⁓ rare earth free magnets can go the distance, no pun intended. and then just a taglong curiosity question in terms of size, are your motors the same size as similar what they're maybe they're used to?

Tom Grainger (23:25)
It's I we'll we'll run through both and

It highlights something. Daniel, you're crossing the chasm thought. I I just want to share something on that. I know that a big thesis in that is you've got to find the people for whom like the the burning platform, the case for change, or like the light at the end of the tunnel in the in the positive framing is the brightest. And this relates to the automotive questions. I'm gonna tie two things together. One of the interesting things about iron nitride ⁓ is its thermal stability. So when you're

Operating in the rare earth space and you think about a higher temperature grade magnet, you are immediately thinking about using the heavy rare earths as the dopants that provide that thermal stability.

Iron nitride, just by virtue of being a different material, ⁓ that thermal stability is intrinsic. So as we think about a magnet operating at 80 degrees Celsius or 20 degrees Celsius or 150 degrees Celsius, it's the same iron nitride magnet. Like there's no difference in formulation to target any of those operating temperatures profiles. And so that's been one of the things that has really been attractive to it's not just automotive, but like the motor segment more broadly, because these

Daniel O'Connor (24:12)
.

Tom Grainger (24:39)
These

things are running, they're running hot, there's not a lot of room to breathe. If you're giving it room to breathe, you're giving up room to do something else. And so your question on motor size, the typical constraint, and this is for those conservative customers, ⁓ but also size is a performance metric. Like space is not limited, weight is not limited, is to hold constant, and we'll use a pump because it's got so each of the different representative levels are there in this example. But if you think of the plastic casing that involves the it

Will have all the interconnects with your broader fluid system. And this could be cooling in a car, it could be cooling in a data center, increasingly is an exciting growth area with an HVAC. That's going to look the same. There's no change outside in the systems it connects to, there's no cascading effect. If you strip away all the plastic and say, now I've just got the motor, the envelope of that motor is typically set as a constraint. You keep that the same because that, you know, if you think about power density, the density is dependent on the

Size, this is your size. Then you go, okay, let's break the motor down into a stator and the rotor. The stator is staying in place, your copper coils, the rotor is your rotating component.

And typically that stator, we have that stay the same in terms of design and hold that constant. There are cases where we have customers, and this is these are the bold who are looking to eke out every performance advantage they can, want to make changes at the stator level. ⁓ but the majority of times we're recommending the conservative path because we'd rather people push us.

Only so much change at once has usually been the recipe for having these successes. And then within the rotor, its size, shape are the same. What you're seeing that is different is the internal cutouts where magnets are placed.

different orientation, different aspect ratio, like length over width, of that magnet in profile is how you move from a rare earth permanent magnet motor to a rare earth-free iron nitride permanent magnet motor. And it is that geometry within the constraint of what is, you know, a fixed size steel cylinder, that internal geometry that changes. And like the benefit of all that is that because it is contained within the

like dimensions and volume of that component, there is no cascading effect. And what's very interesting is sometimes by virtue of iron nitride having a slightly lower density than the rare earth magnets and a lower density than steel, is that sort of no matter what you're replacing, is you can sometimes reduce weight from that same component. And so the inertia of that rotor, how much it wants to keep spinning when you want it to stop, can be lessened.

And that gets very exciting, primarily in actuation applications where you're doing small, precise movements that would show up in robotics, that shows up in up flight surfaces and defense applications where that's relevant. ⁓ I'm down my rabbit hole, but that was you sparked a lot of thoughts.

Dustin Olsen (27:35)
Yeah.

Daniel O'Connor (27:37)
Well, just on that note, mean, we write a lot about, Tom, the lengthy process of qualification for rare earth magnets. And what's interesting, lot of the companies, know, mind to magnet is a common theme. And companies that have not been in Magnetics are getting into Magnetics by virtue of maybe their mind and their

Developing the capability but what we sort Yeah, we have a lot of investors that come to to our website and our goal we sort of have a fiduciary duty to them to be critical and vet not just be cheerleaders, although we want to be cheerleaders for the country and for Patriotism and everything but we also want to be critical. I think it's a very serious process ⁓ Qualifying these magnet the magnetic technology whether it's rare earth

Tom Grainger (28:03)
Yeah, the critical integration play. Yeah.

Daniel O'Connor (28:30)
or rare earth free in major corporations? At a high level, you, A, is it a similar process, just the general qualification process per specification? And B, I would imagine you all are getting deeper and deeper into that as your company's growing.

Tom Grainger (28:48)
you've you've hit right to the core of where the majority of our work is happening right now. And this is where different industries like are different. And so there was a sort of a sound bite that circulated for a long time, and I'm partially at fault. I've been a ⁓ a front-facing person for an iron from some time, that iron nitride was like incorrectly believed to be only appropriate for consumer electronics. ⁓ and

What that came from was, hey, consumer electronics has the fastest qualification cycles. So it's probably it's the first place where an iron nitride product will be something that can show up, you know, in infrastructure or under a Christmas tree, depending on which you know specific product you're talking about. ⁓ and so those qualifications.

Daniel O'Connor (29:33)
⁓

A retail drone would be an example for Christmas.

Tom Grainger (29:42)
that'd be an example, or ⁓ the the the first iron nitride product that will be purchasable depending on your budget. It's the hi-fi space and you've got to be an audiophile to love those things will be a like a hi-fi speaker system. and it's great for Nyron because the volumes in that space are small, like you don't make too many SKUs, such that we can actually manufacture that out of the facility that's already built and operating.

As opposed to waiting for the facility that is in Sartel, Minnesota, where we've broken ground, but it's not yet manufacturing, that construction is underway. But to your your question on qualification, that is the fast qualification timeline. as I'm talking about a product launch, like fully through the gauntlet. Not for every customer, but we've we've been through that journey end-to-end. whereas if you look at something like automotive, they are rigorous. And

It's for that reason that if you look at the publicly named investors in NIRON, you'll see an overrepresentation of automotive OEMs and tier ones versus the mix of markets that we intend to serve. And that's because the keys to success that we've seen to get through that qualification cycle together is that you need both sides to be long-term committed to the partnership.

And so that's been the rationale for a lot of those groups to invest is for them that equity investment lets them participate in upside, which is an exciting part of it, but more so it guarantees them like access to supply as soon as it comes online. So they have the opportunity at every stage of their qualification to say, we're gonna be able to run through this process at the fastest pace. And that gives us a competitive advantage because we have our reservation at the table.

And then on our side, we say, hey, we know that this is not a flight of fancy for you. You guys are committed. You've committed the engineering teams prior to that investment to come kick the tires on the material, to design a rare free motor that becomes the basis of what is the typical build and testing after that relationship is cemented with the equity investment. So we're moving through qualification in those longer-term industries.

What has been the most interesting to me, if I think about customers behaving in ways that I would not have predicted. So if we'd done this podcast in December, ⁓ I would not be saying this. But with all the changes in defense, which originally there were you know slides, papers, models that said 10 to 15 years as the timeline between you know initial engagement and deployment in field. And that number comes from a member of my team, ⁓ Carl Sprenthal.

Who introduced one of the first new soft magnetic materials? So it's not a permanent magnet, we're talking about the used for high frequency switching, but introduced one of the first new soft magnetic materials into military applications that you can now see in some of the systems on on ground vehicles. That was 10 years between his first meeting and those being deployed in field. What we've seen over the last four months is.

Customers coming to us, and that's both government customers and then the the primes and tier ones that serve them, saying that's gonna be 24 months. ⁓ and so I had no prediction that defense or national security would be part of our first plants product mix because of the qualification question and how hard and long and arduous those are. And they're no less arduous, and they're no less hard, but they are a lot less long in some of the sectors where

There is a a genuine crisis in the supply chain.

Daniel O'Connor (33:22)
Well, it's fascinating. it's not, it's, well, let's just observe what's happening in the Middle East. There's a completely different sort of reality in terms of kinetic engagement. mean, you know, it's, or Ukraine, there's, you know, drones and pretty soon we'll probably have robotics and it's a very different world.

and you all are perfectly situated. In fact, if you execute correctly, you will be one of the most valuable companies on the planet because nobody else has that. You understand?

Tom Grainger (34:00)
We are are working hard for that and other reasons to execute correctly. Like a lot of folks at Nyron came here and this it's a little bit like how customers come to Nyron for different reasons. There are the supply chain security first folks. There are the breakthrough performance first folks. If you were to talk to walk around the Nyron site on a visit, which hey, if you if you're in the Twin Cities area, you are welcome to come by. ⁓ and I think I think it'd be really fun. ⁓

Daniel O'Connor (34:05)
Yes.

Tom Grainger (34:29)
And talk to different folks around the floor, around the office. ⁓ some came ⁓ for sustainability purposes, like by virtue of avoiding net new rare earth mining, avoiding crack leach facilities, avoiding the energy intensity of metallization, and just starting with abundant commodities that can be supplied out of existing supply chains for iron and nitrogen, you just immediately it's that promise of like do something cleaner.

And as the best clean solutions are, it's cleaner in many ways for the same reasons it can be cost competitive. And because you're not relying on something that has a lot of waste, which is just inherently expensive. and then there are folks who are military veterans and see this as a key potential breaking point in what is otherwise an important foundational aspect of national security, ⁓ and they're here as patriots.

And so the and and then there's the folks who say, Hey, I want to bring something new to the world. what a mark to leave. It's not the same as adding a new element to the periodic table, but there's a single digit number of magnetic materials out there, so it's pretty darn close. ⁓ it's and it it's exciting for those reasons.

Daniel O'Connor (35:47)
Very much so, very much. know, bigger picture just for the investors that frequent this channel and the website. Right now, Ballpark, how many employees are you and what's the growth? I know you've opened up, you're building a new facility. What does the one, three, five years look like? How is your company gonna evolve over the next handful of years?

Tom Grainger (36:13)
Yeah today ⁓ when you come visit it's 170 folks. and the locations are the Minneapolis facility where we've got sort of end-to-end raw materials out to finished magnets, our commercial pilot facility, which is where we're shipping to customers from today. ⁓ and then the site in Sartell, Minnesota. And so it's about 75 minutes by car and

if you were to go visit today, you would see equipment rolling. we hit the timelines to ensure that all of the groundwork was done before things froze over the winter. And as things have thawed, now all of the ⁓ infrastructure is being laid and encased as that factory goes up and there'll be buildings there very shortly that we can then fit out over the winter season. So as you get into 2027, towards the end of the year,

We are expecting to ship the first magnets from that commercial scale plant one production facility in Sartel, Minnesota. And we've already launched site selection for what will be we call it an HVM high volume manufacturing and measuring high volume by the benchmark of competitive and at a similar scale to the incumbent, the guy to beat, the Chinese magnet manufacturers.

for that facility, sort of doing site selection across the forty-eight continental states. and we've got ⁓ a team sort of ⁓ out on the road ⁓ visiting a number of those sites. There was an overwhelmingly positive response to that RFP. And so more to come on that. And that facility is to follow quickly in the footsteps of the Sartel facility, specifically because the manufacturing line in Sartel is that

base building block like the copy paste cookie cutter unit, where higher volume manufacturing, there's no new incremental scaling that has to happen. You're putting more lines under one roof and getting those economies of scale or shared infrastructure.

Daniel O'Connor (38:11)
Fascinating, really exciting, destined. I know we're getting towards the end, but this is really a really exciting and hopeful, I think, situation with neuron magnetism.

Dustin Olsen (38:26)
Absolutely. And so yeah, I think just the one last question I want to came maybe wrap up the show with is ⁓ a tag along question that Daniels is predicting the future. What does it look like? But let's say in ten years, wh what do you think the rare earth magnet market is gonna look like once Nyron it kind of puts its stake out there? Are you guys hoping to replace rare rare earth magnets, complement them?

Or kind of carve out your own segment in which this iron nitride ⁓ magnet is fully applicable.

Tom Grainger (39:01)
It's I I will do my best to predict the future. so always a dangerous exercise, but to your point, we can I think accurately forecast sort of what that strategy looks like. Like when Nyron executes on its roadmap, neodymium iron board magnets will not disappear. Like the market will diversify. Iron nitride is gonna own applications where supply security, stability, and that thermal performance really matter.

⁓ outperforming in applications where efficiency is critical. But the future is multi-chemistry market supplier. You don't want to move a market from one single dependency to the next. Like the goal is to be essential and not to be exclusive. So I think maybe the I'd say the biggest problem with the magnet industry today is we only have one solution. And I I think competition is good and

Diverse solutions mean you can optimize to get the best. And we're gonna need better motors, more efficient motors, more effective motors as we electrify globally, and that's everything from more air conditioning in the global south to this impending wave of robotics and industrial automation. It's sort of an all of the above approach to that. And I think it doesn't happen without what's happening with NIRON.

in new magnet chemistries, as well as all of the other efforts where people are putting everything they can towards diversifying the existing legacy magnet supply chain.

Daniel O'Connor (40:28)
Thank you.

Dustin Olsen (40:35)
said Tom, I if if we can't predict the future, what guides us through it, I think you said really well, is we need to find ways to be essential, not exclusive, so that we don't trade one one exclusivity, one dependency for another. ⁓ and I think that is what the sh future should look like. And I agree with what you said there. So

Daniel O'Connor (40:55)
But Dustin,

our thesis, Tom, about supply chains and choke points and how rare earth elements, critical minerals, and other commodities become extremely important moving forward. So, Niron Magnetics is an extremely important company for our national security and our resilience. So, I can assure you, we're very grateful and thankful for what you all are doing.

Tom Grainger (40:58)
Happy. Yeah.

Daniel O'Connor (41:20)
and encourage anybody watching this to look into you all.

Tom Grainger (41:29)
Hey Daniel Dustin, thank you. it's it's been an honor to be on and and a very good time. I had a lot of fun.

Dustin Olsen (41:35)
Yeah, this is great. And hopefully we can get you back on the show in the future to kinda get an update as things seem to be changing at a rapid pace in this industry. I think it'd be great.

Tom Grainger (41:46)
That is a a well put understatement. So I'm looking forward to it.

Dustin Olsen (41:51)
Perfect. Well, Tom, thanks for being on the show.

Tom Grainger (41:55)
Thank you so much.