Commonwealth Fusion Systems has raised $863 million from a long list of investors, including Nvidia, Google, and Breakthrough Energy Ventures. Co-founder and CEO Bob Mumgaard explained the company’s mission is to advance fusion as quickly as possible and transform it into a commercial industrial endeavor.
The Massachusetts-based company has now raised nearly $3 billion to date, which is the most of any fusion startup. This recent funding follows a $1.8 billion round the company raised in 2021.
Fusion power has long been promised as a nearly limitless energy source, though it is only recently that investors have considered it a viable bet. Advances in computing and AI have quickened the pace of research and development, making the sector a hotbed of startup and investor activity.
Inside a fusion reaction, atoms are compressed and heated until they form a fourth state of matter known as plasma. When the plasma reaches the right temperature and pressure, the atoms begin to fuse, releasing tremendous amounts of energy.
The company is currently building a prototype reactor called Sparc in a Boston suburb. It expects to turn that device on next year and achieve scientific breakeven in 2027. This milestone occurs when the fusion reaction produces more energy than was required to ignite it. While Sparc is not designed to sell power to the grid, it is vital to the company’s success.
An associate professor of physics at the College of William and Mary, Saskia Mordijck, noted that there are parts of the modeling and physics that are not yet fully understood. She said it is an open question whether turning on a new device might reveal unexpected plasma regimes or uncover unforeseen challenges.
Assuming Sparc does not reveal any major problems, Commonwealth Fusion Systems expects to begin construction on Arc, its commercial-scale power plant, in Virginia starting in 2027 or 2028. Both the Sparc and Arc designs are tokamaks, a type of fusion reactor that uses powerful superconducting magnets to confine and compress plasma. This design is well known within the research community.
The list of participants in this funding round is lengthy. No single investor led the round, and a number of existing investors increased their stakes. Existing investors that increased their commitments include Breakthrough Energy Ventures, Emerson Collective, Eni, Future Ventures, Gates Frontier, Google, Hostplus, Khosla Ventures, Lowercarbon Capital, Safar Partners, Eric Schmidt, Starlight Ventures, and Tiger Global.
New investors include Brevan Howard, Morgan Stanley’s Counterpoint Global, Stanley Druckenmiller, FFA Private Bank in Dubai, Galaxy Interactive, Gigascale Capital, HOF Capital, Neva SGR, Nvidia’s NVentures, Planet First Partners, Woori Venture Partners US, and a consortium of 12 Japanese companies led by Mitsui & Co., Ltd. and Mitsubishi Corporation.
This broad base of investors may prove helpful as the company develops its supply chain and searches for partners to build its power plants and purchase electricity. The company has already inked a deal with Google to buy 200 megawatts from the future Arc power plant.
As the first of its kind, the Arc power plant is likely to cost more than subsequent facilities. While Sparc will help prove the underlying science, it will also allow the company to understand the necessary capabilities and the true costs of building such technology.
This new funding will help the company make progress on Sparc, but it will not be enough to build Arc, which will likely cost several billion dollars. The company is not yet sure what form the funding for Arc will take, acknowledging that its status as a first-of-its-kind technology adds a wrinkle that will impact where the capital comes from. The company and its investors remain committed to seeing the project through.