CorePower Magnetics Inc., a Pittsburgh-based magnetics company with a big role to play in the transition to electric vehicles and a more sustainable electrical grid, has received $2.5 million in preseed funding.
The preseed funding round was led by battery-tech investor Volta Energy Technologies and also included clean-energy investor Evergreen Climate Innovations and Pittsburgh-based startup investment fund Innovation Works.
CorePower Magnetics' technology, which was developed in Pittsburgh, promises to help make more efficient and lightweight engines in electric cars — saving fuel mileage — as well as being able to cut back on the rare earth minerals that are used in electric motors.
CEO Sam Kernion said the preseed funding will help CorePower hire key personnel on the commercial and technical side that will help it scale up business and manufacturing. CorePower, unlike a lot of young hardware technology companies, already has commercial revenue. Kernion said the company is able to build orders for customers at its space at the Energy Innovation Center in Uptown Pittsburgh even though it doesn't have a scaled-up manufacturing facility.
"This (preseed funding) is going to help us support some of that initial demand better with these customers and ... expand that capacity as well as so we can grow," Kernion said.
CorePower, which began in 2020, has revenue of between $1 million and $5 million, according to a document the company filed Aug. 22 with the U.S. Securities and Exchange Commission.
Kernion said that scaling up the business and manufacturing of CorePower will increase employment at the company from where it is today, about 11 company employees and contractors. There are already openings on its website.
CorePower licensed magnetics technology from Carnegie Mellon University that is 10 times lighter and five times the volume of typical magnetics technology, important factors in electric vehicles where weight is always an issue. It also has the ability to lessen the demand for rare earth minerals, which have supply and cost issues, in components for the electrical grid. Kernion said rare earth minerals are commonly used in motors but with CorePower's soft-magnetics technology, they may not be needed to get to the same power and size.
That message is resonating already, even though CorePower hasn't scaled up.
"We've had early success with defense contractors and we're also seeing early-on design efforts for electric vehicles," Kernion said. "Our long-term (efforts) are going to be on that passenger vehicle side as well as the power grid. One particular area is EV charging, which lies at the intersection of EVs and the grid."
CorePower in April was awarded a $250,000 grant from the Wells Fargo Innovation Incubator (IN2) from the Wells Fargo Foundation and the National Renewable Energy Laboratory to support the development and technology of clean-energy projects. CorePower, which was one of only five companies in the country to receive funding this year, will be working on demonstration projects for electric vehicles and grid efficiency with Eaton Corp. (NYSE: ETN).
"For EV's, there's a lot of concern right now about range, around charging time," he said. "Our projects can help to make charging time faster and lightweight the vehicles so the range is longer. With the higher power needs (of EV chargers), the charger station is going to get bigger, and we can help to bring that size down."
Kernion, a CMU graduate who returned to Pittsburgh to become CEO of CorePower in 2021, said the funding will help put down further roots in Pittsburgh. He said CorePower, whose key management is from Pittsburgh and the Mon Valley, are very intent on keeping local ties and putting its manufacturing operation here.
"We're really passionate about the Pittsburgh region," Kernion said.
