Redwood Materials raises $350 million with backing from Nvidia to expand U.S. battery recycling operations

Battery recycling startup Redwood Materials has raised $350 million in new funding, led by Eclipse Ventures, with participation from Nvidia’s investment arm, NVentures, and several other investors, the company announced Thursday. The new round strengthens Redwood’s position as one of America’s most important players in building a domestic supply chain for critical battery materials.

Founded in 2017 by J.B. Straubel, the former Tesla co-founder and chief technology officer, Redwood is tackling one of the biggest challenges in clean energy — how to recycle and reuse key elements like lithium, cobalt, nickel, and copper at scale. The Nevada-based company isn’t just focused on recovering materials from old batteries; it’s also building large-scale energy storage systems that help stabilize the grid and provide backup power for data centers.

Redwood’s timing couldn’t be better. The growing adoption of electric vehicles and AI-driven data centers has sent global demand for batteries and energy storage soaring. Governments are pushing for more secure and sustainable supply chains, while tech and automotive giants are racing to reduce reliance on overseas materials.

Straubel, who left Tesla in 2019 to scale Redwood, has spent years assembling partnerships with major corporations, including Volkswagen, Panasonic, Toyota, and Lyft. Those alliances have helped Redwood become one of the few U.S. companies capable of producing battery materials at a commercial scale.

The company said it will use the new funding to expand its energy storage operations, materials production capacity, and employee base across the U.S. Redwood was previously valued at $5 billion following its $1 billion Series D round in 2023, bringing its total equity funding to nearly $2 billion, along with an additional $2 billion loan commitment from the U.S. Department of Energy.

“With this new capital, Redwood will accelerate the expansion of our energy storage deployments, refining and materials production capacity, and our world-class engineering and operations teams. We’re actively recruiting those who want to shape the next era of American energy leadership and critical-minerals independence,” Redwood said in a news release.

As the race to secure energy independence and meet AI-driven power demands intensifies, Redwood’s expansion marks a major step toward creating a sustainable, closed-loop battery supply chain made in America.