Highlights
- Phoenix Tailings closes Series B funding round with global investors like Sumitomo and In-Q-Tel.
- Targeting U.S. rare earth processing independence.
- The startup aims to break China’s 90% dominance in rare earth metal refining through innovative, non-toxic processing techniques.
- Investors signal strategic commitment to rebuilding U.S. critical minerals supply chain for national security and clean tech applications.
In a pivotal development for U.S. critical minerals independence, rare earth processing startup Phoenix Tailings (opens in a new tab) has successfully closed its Series B funding round, with backing from a powerful syndicate of global investors led by South Korea’s Envisioning Partners (opens in a new tab). Major participation came from Japan’s Sumitomo Corporation of Americas (opens in a new tab), Builders Vision (opens in a new tab), and strategic defense-aligned funds like In-Q-Tel (opens in a new tab) (IQT)—highlighting intensifying urgency around rebuilding U.S.-controlled refining capacity for rare earth elements and critical metals.
The round, as reported by Reuters (opens in a new tab), marks a strategic bet on Phoenix Tailings’ promise to commercialize waste-free, non-toxic metal refining, targeting neodymium, dysprosium, and other rare earths vital to EV motors, wind turbines, and defense systems. This comes amid growing global alarm at China’s near-total dominance of rare earth processing, with over 90% of global refining and full control of heavy REEs.
CEO Nicholas Myers (opens in a new tab) celebrated the milestone on LinkedIn, stating:
“We are done with the Series B. Now we can really get to work making sure the U.S. and her allies have the critical metals we need for national security.”
The investor roster reads like a coalition of national resilience and clean tech: BMW i Ventures, Yamaha Motor Ventures, Presidio Ventures (Sumitomo), IQT, Olive Tree Capital, EnergyInnovation Capital, and Plum Alley Ventures. Notably, this round positions Phoenix Tailings as one of only a few U.S. firms with both capital and technical ambition to tackle the rare earth bottleneck without toxic tailings or reliance on China.
REEx Take
While the Series B signals strong investor faith, key questions remain from commercial scalability to supply chain integration and background policy support. For example, Phoenix Tailings has not yet announced when its technology will scale beyond pilot operations or deliver commercial-grade oxide output at volumes needed for magnet manufacturers. Moreover, the company’s success hinges on securing consistent feedstock and downstream magnet partnerships, currently dominated by China. Finally, there is no mention of U.S. Department of Defense or DOE grant support, raising the question of whether U.S. policy is keeping pace with the private sector. However, the company has received an ARPA-E grant and has been on the radar of U.S. elected officials, such as Elise Stefanik (opens in a new tab).
Still, this marks a rare moment of optimism: a venture-backed, waste-free refining firm based in the U.S., supported by Asian allies, and aimed squarely at breaking China’s grip on rare earths.
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