Niron Magnetics Inc., a startup that’s developing magnets made without rare-earth materials, is planning to expand beyond the automotive industry into consumer electronics.
The Minneapolis-based company announced Tuesday that a recent $25 million strategic investment round was led by Samsung Venture Investment Corp, which invests in tech innovations for consumer electronics, semiconductors and telecommunications. It's an affiliate of Seoul-based Samsung, the global consumer and industrial electronics company.
The investment was part of a $86 million round that was reported to the SEC in January, the largest equity round for a Minnesota startup in over a year.
Niron has primarily worked on scaling its commercial manufacturing capacity so that its iron nitride magnets can 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.
Niron now says it plans to use Samsung’s support to widen its ability to support clients in other industries, saying it will extend pilot production and support customer prototyping programs. The company has long noted that its magnets can be used in batteries ranging from consumer electronics to wind turbines.
Samsung Ventures said in a news release that Niron’s clean earth magnet has the potential to “revolutionize” consumer electronics and the audio market.
The $25 million funding round also two automotive investors to Niron's roster: Allison Ventures (NYSE: ALSN), the venture capital arm of propulsion solutions manufacturer Allison Transmission, and Magna (NYSE: MGA), one of the world’s largest automotive suppliers. Niron’s previous automotive investors General Motors Co. (NYSE: GM) and Stellantis (NYSE: STLA), who led last fall’s $33 million round. In 2021, Niron attracted $23 million from Volvo Cars Tech Fund and Volta Entergy Technologies.
Jonathan Rowntree, who joined Niron as CEO in 2022, said in a statement that he looks forward to collaborating closely with Niron's investors and partners.
Josh Berg, Magna’s managing director of technology investments and ventures, said in a statement that Niron’s tech is an example of a “building block” for future sustainable product innovations.
“Magna invests in technologies for multiple reasons, including those that have the potential to enhance our competitive position,” Berg said.
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 2014, 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.
