Battery recycling startups have sprung up in Europe aiming to exploit the next big opportunity in the electric vehicle market: waste batteries.
Among them is Cylib, a Germany-based startup with a pitch that automakers might find financially attractive. The company claims it can extract pure forms of all materials from a battery using a fraction of the energy used by its competitors.
This means that Cylib is able to recover all elements from electric vehicle and micromobility batteries, as well as production waste, including lithium, cobalt, nickel, aluminum and manganese, using 30% of less energy than its competitors.
Lilian Schwich, CEO and co-founder of Cylib, is betting that this secret sauce will give the startup an edge over competitors with more resources and longer value chains, like Swedish incumbent Northvolt and U.S. heavyweight Redwood Materials . Massachusetts-based Ascend Elements also recently took on a European role by forming a joint venture with Polish startup Elemental.
That was enough to attract backers from the climate, deep tech and corporate automotive sectors, said Schwich, who has spent more than a decade researching resource-efficient battery recycling methods at RWTH Aachen University before founding the startup in 2022.
Earlier this month, Cylib raised a €55 million Series A round, co-led by World Fund and Porsche Ventures, the venture capital arm of sports car maker Porsche. Bosch Ventures, DeepTech & Climate Fonds, NRW.Venture and others also participated in the round.
Cylib will use the funds to build its new industrial-scale factory in Aachen with a launch date in 2026 and strengthen its team by 60 employees. In the long term, Cylib wants to expand beyond Germany and into other European markets.
“In our seed round we raised 7.6 million euros and with this we built a pilot facility where we are already able to recycle one electric vehicle battery per day, or around 300 at 600 kilograms per day”, Gideon Schwich, CEO of Cylib. co-founder and COO and husband of Lilian Schwich, told TechCrunch. “In a Tesla you have about 300 kilograms, and in a Porsche you have about 600 kilograms.”
Capacity today, cathodes tomorrow
Cylib has already established relationships with automotive OEMs, Tier 1 suppliers and lithium refineries to secure battery production waste for near-term recycling. These partnerships are crucial to Cylib’s long-term success and continued supply of raw materials, ensuring access to end-of-life electric vehicle batteries for future recycling.
Securing raw materials (such as batteries and production waste that can be processed in a recycling facility) is also important today for Cylib to be able to prove to manufacturers that it has the capacity to manage recycling at the same time. industrial scale.
“The problem with battery recycling is that if you don’t have capacity, the big guys won’t provide you with raw material,” Anil Achyuta, managing director of TDK Ventures, the giant’s venture capital arm, told TechCrunch Japanese electronics company TDK Corporation. “And if you don’t have raw material, you won’t have capacity.”
Achyuta said TDK Ventures, which invests in Cylib competitor Ascend Elements, helped the startup prove its value in 2021 by “taking a big turn in the market” and investing a lot of money in capacity building and the purchase of raw materials. Today, Ascend’s plant in the United States can process 26,000 tons per year.
Raw materials and capacity aside, Achyuta says that as an investor, what he really wants to see in battery recycling companies is a plan to produce cathode active materials at the same time. future, because that’s where the real money is. The cathode is the part of a lithium-ion battery that stores energy and releases it when a battery is used. It is generally composed of metal oxides such as lithium-cobalt oxide or lithium-manganese oxide. In other words, battery recycling startups should go beyond battery recycling and material refining to get into cathode material remanufacturing.
Today, most battery recycling companies export battery materials to China and other parts of Asia to develop cathode active materials, which are then sent back to automakers and battery manufacturers domestically. . This goes against the principles of the circular economy.
Schwich said Cylib plans to produce cathode active materials in the future, but doing so on an industrial scale is not a top priority until the startup commissions its new facility.
“We have the highest value-add in the market with what we do best, which is producing truly green, pure raw materials into technology grade or battery grade,” Schwich said. “But that doesn’t mean these materials can be used directly to build new cells. They still need to take a few steps, and this is something we are already developing with our partners.
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