S1 E31 – Nitin Gupta: Attero Is Revolutionizing Recycling of REEs & Critical Minerals

Dustin Olsen (00:40)
Welcome back everyone to the Rare Earth Exchanges podcast. You've got me Dustin, I'm joined by Daniel and we have a special guest Nitin Gupta from India and we're excited to hear all that he's working on. So Nitin, thank you so much for joining the show today. To kind of just get us started, we'd love just to hear a bit of your background, what you're working on today and yeah, let's hear it.

Nitin Gupta (01:03)
Yeah, first of all, Dustin, Daniel, pleasure to be here. It's really nice to be able to talk to your audience and speak about the work that we are doing at Adderall. My personal background, I did my bachelor's in electrical engineering from IIT Delhi, which is the premier engineering college in the country.

worked as a signal processing engineer, basically designing chipsets for mobile phones, home access devices in India and US, did my MBA from NYU Stern School of Business, and then went back to India to start Atero with Rohan, who's my co-founder. And that's sort of a brief background about myself. In terms of the work that we are doing, Daniel and Dustin, Atero is a leading technology player in the critical mineral space globally.

We have today more than 46 granted global patents on various recycling technologies developed by us in India. Patents are across US, Europe and Asia, including China. We're also the only company in the critical minerals recycling space in the world to generate carbon credits per ton of waste recycled. And to give you a brief snapshot, we today recycle all kinds of electronic waste.

ranging from let's say your CFL lamp to your refrigerator or air conditioner and everything in between, mobile phone, laptops, what have you. We recycle rare earth magnets, we recycle lithium and batteries, we recycle solar panels, right? What we extract is 22 plus pure metals, including gold, silver, palladium, copper, aluminum, tin, zinc, including let's say dysprosium, neodymium, presidium and sort of GD, including lithium carbonate, cobalt, nickel,

that we put back in the circular economy ecosystem as a company with the largest player in India by any metric and with the best technology for critical minerals recycling globally. Profitable cash flow positive growing 100 % year on year backed by market investors, largely US based shareholders Dustin and Daniel. I'll stop there much, much more to unwrap, but we'll go with the conversation.

Daniel (03:04)
Yeah, that's impressive. It's very impressive. I think, Tero, let's talk about ⁓ the concept. How did you and Rohan come up with the concept? What was that light bulb moment? Where were you at? And how did it come together? And how did you first start it?

Nitin Gupta (03:20)
So, Rohan was working at SAP in Bangalore and also in New York. So Rohan had an old laptop which he didn't know what to do with. So, Atero's journey essentially started with a question of what happens to end of life devices in the lifespan, right? And when we dug deeper, we did realize that this sits in the intersection of technology and sustainability, which are the core DNAs of the company today. So that's how the idea got sparked. We obviously raised a

first round of capital from Draper Fisher-Jewiston, DFJ and India US based venture capital firm called Kalari Capital. We started doing R &D and started building the market and the plant, recycling plant and the collection infrastructure alongside Daniel.

Daniel (04:04)
Very impressive. And what year was that that you both started that?

Nitin Gupta (04:08)
This was in 2008,

Daniel (04:11)
Okay, that's right. Okay,

2008. Now, if we look at the core, so the core mission today, it's not just rare earth, it's a series of sustainability criteria and measures, correct?

Nitin Gupta (04:23)
Yes, so all critical minerals, rare earths are part of critical minerals. So anything to do with critical minerals, our basic concept Daniel is that today mining is among the most polluted industries in the world.

right? So if there is a way that we can replace part of mining and there is a way to do that by urban mining, which is all the discarded scrap stuff that is available, if you can put that in a reasonable manner, recycle them using technology, extract these metals, put them back in the circular economy, that way we reduce the dependence on mining, much more sustainable.

⁓ and it is local. It does need to be international. It does not need to cross borders. It is completely local and self-dependent, Daniel.

Daniel (05:07)
Very important, very important. can we talk to the extent you can, can we talk about your technology? Like, we're ⁓ surveying different types of approaches to urban mining and recycling of rarest and critical minerals. How does your firm fit into that ecosystem and what differentiates at a high level your approach, your methods, your technology?

Nitin Gupta (05:29)
So four critical differentiating factors, Daniel. One, our recovery rates from output to input are best in class globally. As an example, from end of life lithium and batteries, today we are recovering more than 98 % of pure battery-grade cobalt, pure battery-grade lithium carbonate, graphite nickel. Global averages, Daniel, are around 80%.

Right? Similarly, if you look at rare earth magnets, from rare earth magnets, we are recovering more than 98 % of Neutron oxide, Presidium, Disprosium and GD. World averages or global averages are less than 75%. Right? Similarly, e-waste. Right? So first advantage is recovery efficiency, which is broadly around 25 to 30 % better than anybody else in the world. Second is a modular approach to recycling. So our typical recycling plants are profitable.

at let us say a 1000 tonne per annum level in terms of electronic waste are profitable at 100 tonnes per annum level for lithium and batteries are profitable at 100 tonnes per annum level for rare earth magnets and so on so forth. Again, globally if you speak to multiple companies that number is 10 times our numbers. Third,

Our capex per tonne is lower by 40 % compared to anybody else in the world. And here I'm doing an apples to apples comparison Daniel. We are in fact looking at setting up a plant in US and Europe and these are those numbers. It's not an India capex compared to US capex. Fourth, our op-ix is lower. And last point is our TAM is higher because we are recycling all kinds of stuff. So specifically in lithium-ion batteries, we're the only company in the world recycling LFP battery chemistry and

lithium carbonate and graphite and profitably doing that. Most other lithium and battery recycling players are focused on cobalt and nickel-rich batteries. Similarly is the case of magnets, similarly is case of e-waste Daniel.

Daniel (07:19)
Very impressive, very impressive. So basically from that standpoint, you're truly emerging as a global leader in this space. Now want to get into, at least on the rarer side, only about 1%. This is the number we continuously run into, derived from recycling today. Is that a number that you've heard and do you agree with that number?

Dustin Olsen (07:35)
you

Nitin Gupta (07:40)
Today, so depends on which metal you're talking about, rare earths, for example, less than 1 % completely agree. But take a look

Daniel (07:47)
Wow, wow.

⁓ So to date, the under 1 % with the rare earths, is that just a function of maturity that we're early in the lifecycle of these different approaches? And also I wanted to ask you, about China. You would think, given China's control of this space, they've got 90 % of the processing. And they seem to be big into recycling and ⁓ ESG, at least.

Dustin Olsen (07:48)
Okay.

Daniel (08:13)
That's what the news

tells us over there, the companies. Why isn't China pouncing on this to become a leader?

this is a fascinating topic. I mean, China has made all sorts of moves over the past 20, 30 years to monopolize rare earth processing and magnet production. They know that the recycling is coming. Why on earth have they not invested, leveraged their position to control that space?

Nitin Gupta (08:36)
So, couple of things Daniel, first is rare earth mining or processing or refining is not that clean an activity from an environmental perspective in China as is it made out to be, okay. In fact, it involves a lot of influence and so on so forth, right. Second, China has a dominant position today. So, in rare earth sort of recycling that is not their focus area because they did not think that that field could basically disrupt their pole position, right.

Daniel (08:50)
Right. Yep.

Nitin Gupta (09:04)
Having said that, even if you look at it as a parallel, look at lithium and battery recycling, right? China has the largest capacity for battery recycling in the world today. They also have the largest capacity for refining of lithium carbonate in the world today. So they are building that recycling capacity in fields where they feel that other countries can catch up. Rarer, they're still to build. Okay. But I'll give you another example here, Daniel. Even in battery recycling,

and we know a lot of Chinese companies because they keep continue to visit us from that perspective. Nobody in China today is recovering graphite by recycling end of life lithium batteries. The reason again is graphite as an element has a very low economic value compared to cobalt and nickel. So they didn't focus on it, right? From that perspective, Atteros take us better. Similarly from a rare earth angle, they didn't think that it can happen so fast.

Daniel (09:59)
Understood. That's fascinating. Fascinating. would you say, Fratero, would you say that your patents are your key differentiator and what does your patent portfolio look like and what percentage of your secret sauce is trade secret?

Nitin Gupta (10:14)
So our patent portfolio is 46 granted global patents, 200 applied for. There is, I would say 20 to 30 % of our process is trade secrets and 70 % is patented, roughly. So apart from technology, Daniel, for a successful recycling business, the collection network is critical as well, right? If you're not able to collect these devices,

how good the technology might be, you'll get no output, right? In India, we run two digital platforms. One is called CellSmart and the other one is called MetalMundi, right? CellSmart, essentially consumers can go online and we'll pay them a price for their end of life devices and we'll pick it up from their home, okay? In MetalMundi, we're aggregating these sort of scrap dealers across the country.

providing them transparent and fair pricing for different categories of scrap and a complete traceable supply chain. Okay. At the backend of both of these Daniel, there is a very strong AI based pricing engine that's running. Okay. I'll give you a further example. Let's take, let's say a magnet that is part of a speaker phone in a Samsung phone, right? Speaker in a Samsung phone. That is a different NDPR concentration.

compared to a magnet that is part of a compressor in let's say an LG air conditioner. That's got a different NDPR concentration. So when in Metal Mundi, you'll see the pricing of these magnets for various scrap dealers. It basically picks up at the backend, the NDPR pricing, where's the image and then puts out a price. All of this is happening automatically.

Daniel (11:47)
And that's brilliant, Nitin. I have to give you guys credit. You've really thought through the whole life cycle. And these both CellSmart and MetalMandy are pretty ingenious, I have to say. Are you there, Nitin? Okay. So I would imagine, let me ask me that, can you take those softwares and license those to other parts of the world, to other groups?

Dustin Olsen (11:53)
Okay.

Nitin Gupta (12:01)
Yes.

We are

in the of doing that, Daniel. Very soon we'll be sort of launching these in Europe and then the US, Daniel.

Daniel (12:17)
Yeah, that's great. Okay, how much money capital have you all raised so far total?

Nitin Gupta (12:22)
So Daniel, till date we have raised around 25 million US dollars. That's largely come from IFC, which is part of the World Bank Group. That's come from DFJ, DPG. That's another large US-based private equity investor. Last year we did roughly around 120 million dollars in revenue. And the year before that we did roughly around 60 million dollars in revenue. This year we do roughly around 250 million dollars in revenue.

Daniel (12:43)
Yeah.

Yeah, you all are on your way to something big. You're going to be one of our new rich friends. That's for sure. Let me ask you this. If you look at the growth trajectory, what do you see as your biggest risk? As you're starting to scale up this operation, what keeps you up at night?

Nitin Gupta (12:51)
⁓

So Daniel, first the scale of opportunity and the timing being right is a big sort of advantage plus a big burden as well, right? Given the position where critical minerals industry is globally today, it is incumbent upon all of us, including ourselves, to make sure that we create something scalable, global and big here. The Ex-China strategy has to play out.

The world cannot be held hostage to one country deciding on critical mineral supply chain and suddenly deciding they'll stop exports. That's exactly what happened a couple of weeks ago, right? ⁓ That scale of opportunity keeps us awake at night saying, are we doing enough? Can we do more?

Daniel (13:38)
That's right. That's right.

Let's talk, and you're a very important company and that's why we identified you. And I don't think a lot of folks in the United States know who you are yet, but they will soon, thanks to this podcast and all the good work you're doing. Now, sustainability, let's talk about this carbon credit. It's a very complicated area, and of course, with our new administration, we don't have a weather problem anymore. Those are old days. But in the rest of the world, so.

Dustin Olsen (13:47)
you

Okay. ⁓

Nitin Gupta (14:06)
Hmm.

Daniel (14:12)
How does it work? Break it down for a lay person.

Nitin Gupta (14:15)
So simply speaking, Daniel, the amount of energy used in Atero's processes to extract pure metals, be it rare earth metals or precious metals or base metals or any other critical metal is significantly lower than the amount of energy used in extracting those metals from a virgin mine. Okay, that is just for us, right? Having said that, Daniel, as a company, as a firm, we are not very

Daniel (14:35)
Yes, right.

Nitin Gupta (14:43)
dependent on monetization of carbon credits. In fact, look at it as a green discount. Today, the gold that we extract is 99 % lower carbon footprint than the gold that comes out of mining. The lithium carbonate that we extract is 97 % lower carbon footprint than what comes out of China and so on and so forth, right? But we are selling these metals at market prices. We are not extracting a green premium. We're not expecting a green premium. Okay.

Daniel (15:08)
Okay, okay.

Dustin Olsen (15:09)
Thanks.

Nitin Gupta (15:09)
It's a sustainability

metric to show that the work that we're doing is important for the environment and the society. But from a financial standpoint, as a firm, we stand on our two legs.

Daniel (15:21)
Yep, yep, that makes sense. you're, okay, so currently you're at 120 million in revenue about today, okay. Any plans of going public?

Dustin Olsen (15:22)
you

Nitin Gupta (15:29)
Yes.

Yes, we looking to go public in the next 12 to 24 months, Daniel.

Daniel (15:36)
Okay, good. And how many employees do you have? Now, I may have asked, forgive me if I already asked that, but about how many employees do you have right today?

Nitin Gupta (15:42)
Right

now around 800 people total Daniel.

Daniel (15:45)
Okay. 800 and you're, you're, you're in it. Where are you based in India? What city?

Nitin Gupta (15:50)
multiple cities, the main headquarters is in Delhi, Daniel.

Daniel (15:53)
Okay, okay. Based in Delhi and then you're setting up operations in the United States, Europe. ⁓ What in terms of, is there anything in terms of, are you looking for partners in these countries? Are there things that you need to do to be successful there that we can help you with on Like are there types of partnerships or opportunities you're looking for?

Nitin Gupta (15:59)
Yes.

So Daniel, we're always open to partners

who can help us grow and we grew together, right? That is always the case. We're interested there. At this point in time, there's no specific answer I can give you for that. Part of the expansion is confidential. We are raising money in the US. We're raising capital in Europe as well. We are in discussions with partners. So I can't give you a specific answer, but we are always open to working with good people, Daniel.

Daniel (16:40)
Excellent. Excellent. Yeah, I think it's very important. think that this… another important question, just ballpark. What's your forecast being conservative but upbeat in terms of, and especially given your role, your company's role in this process, let's say by 2030, which is five years away, four and a half years away.

What percentage of rare earth magnets will be derived from recycled processes, urban mining, etc.

Nitin Gupta (17:07)
Okay, so Daniel, in my opinion, we will cross the 50 % mark.

Daniel (17:12)
Wow. Wow. That's, that's a great, that's

Nitin Gupta (17:13)
there you, yeah, I'll give you small

sample, right? There are magnet manufacturers who have, who working with us already. We supplied them our NDPR oxide, right? The quality of that NDPR oxide is similar to what they get out of virgin mining. There is a material shortage because China is blocking all those materials. So today,

If you're a magnet manufacturer out of extract, which is not based in China, you have a tough problem of getting raw materials from making your magnets. Okay? Where would you get these raw materials from? So recycling is anyhow coming up the value chain. And as we are scaling up, collecting more more rare earth magnets, the technology exists to recycle them. It's a matter of scaling up this operation.

Daniel (17:58)
Yeah, that's extremely exciting. I mean, if that's even half accurate, in my opinion, that's extremely exciting. What about heavy rare earths? Do you all have experience producing those?

Dustin Olsen (17:59)
you

Nitin Gupta (18:09)
Not right now, but we will be looking at it very soon, not right now.

Daniel (18:12)
We can share with you that the US government right now is actively looking for sources. So that's something we'll look into just from our research standpoint, the process. Dustin, think this has been incredible. Nitin, think actually you and your partner are brilliant, frankly. I think you guys have been visionaries. That's why we wanted to have you on.

We saw when we started this company, we saw what you were up to and we thought these guys are going to be important in this whole process. Dustin, any sort of final questions

Dustin Olsen (18:42)
you

Daniel (18:43)
or thoughts from your end?

Dustin Olsen (18:44)
No, I honestly Daniel, you took the question right out of my brain of how long is it going to take before we start to see meaningful amounts of recycling coming from rare earth? I think just from an environmental standpoint, so we are like we're talking about e-waste, we're talking about recovering some of these critical minerals. Are you doing anything else with the rest of the e-waste outside of that? you?

Are you just going for the critical minerals and leaving the rest or are you trying to also repurpose the rest of the e-waste?

Nitin Gupta (19:14)
So all the e-waste that comes for recycling dust in is completely recycled and extracted. So we extract apart from rare earth, critical minerals, base metals and precious metals and plastics. And all of that goes back into the circular supply chain. Repurposing today is let's say 10 % of the business. It's a small business, small part of the business, but repurposing in our opinion is a critical part of any recycling value chain.

Dustin Olsen (19:38)
Absolutely. That's awesome. yeah, I agree with Daniel. This has been a very educational and honestly, very exciting, discussion in just, terms of where we're at now and where we're headed in a short amount of time. every, a lot of people that we talk to here on the podcast, things are not quick. Things do not happen at a fast pace in this industry, ⁓ for many reasons. and, so to hear your optimism, your

your projections over in just the next five years is awesome. There's not many words else to describe that. So we would love to have you on the show again at some time in the future, get an update on where you're at, whether it's your IPO, your expansion, whatever it is, we would probably love to have an update from you in the future.

Ninton, thank you so much for being with us and sharing some information about what you're working on. And we'll see everyone later.

Nitin Gupta (20:27)
Thank you, It pleasure speaking to you guys. Thank you.

Dustin Olsen (20:31)
Thanks.