Niron Magnetics Inc., a startup that's developing magnets made without rare-earth materials, has raised over $86 million in funding, according to a securities filing.
The Minneapolis company disclosed the funding, which includes a mix of equity and $61.3 million of convertible securities, with the Securities and Exchange Commission in a Form D filing Jan. 3. Niron couldn't immediately be reached for comment.
The deal seems to be the largest equity round for a Minnesota startup in more than a year. The next-largest was from Rochester-based Nucleus RadioPharma, which closed a $56 million Series A round in October, according to CrunchBase. (2022 had a few deals worth $80 million or more, but investment activity slowed significantly in early 2023)
According to the SEC filing, Niron's latest round began in December and included 79 investors.
The Minneapolis-based startup is planning to commercialize iron nitride magnets to be used in electric vehicle motors. Permanent magnets in EV motors are typically made from rare earth minerals like terbium, dysprosium, praseodymium and neodymium, which are expensive and currently processed almost entirely in China.
Niron is the first to develop a permanent magnet with automotive-grade power that is entirely free from those materials.
The batteries can also be used in products ranging from consumer electronics to wind turbines, but it's the auto sector that's been the most interested. A $33 million funding round last fall included investments in Niron from auto giants General Motors Co. (NYSE: GM) and Stellantis (NYSE: STLA), the Dutch company behind brands such as Dodge, Jeep, Fiat and Maserati.
In 2021, Niron attracted $23 million from Volvo Cars Tech Fund and Volta Entergy Technologies.
Niron’s rare-earth-free magnet was recently named one of the best inventions of 2023 by TIME Magazine. In 2022, the U.S. Department of Energy awarded Niron a federal grant of $17.5 million.
Founded in 2015, the company began as a team of four working on borrowed University of Minnesota equipment. Now with over 60 employees in its Minneapolis facility, Niron is now planning to shift from research stages to produce 500 tons of magnets per year, which could create 200 jobs in the region.
