Nuclear fusion startup Proxima Fusion has secured €15m in new funding, extending its Series A to €145m as European investors continue to channel funds into companies they think can help the continent keep pace with the US and China.
The new funds come from Italian state fund CDP Venture Capital, the European Innovation Council Fund (EICF) and hedge fund Brevan Howard. The company has raised €200m in total: previous backers include Cherry Ventures and Balderton Capital, which led the company’s €130m raise in June this year.
Proxima, which spun out of Germany’s Max Planck Institute for Plasma Physics, will use the funds to continue building its stellarator: a device it believes is the most viable route to commercial fusion power.
Founder Francesco Sciortino tells Sifted the new funds will carry Proxima to 2027 or 2028, when it hopes to have completed construction of the magnet central to its stellarator. The company is already in discussions with governments about where it will build its first plant, which will cost over €1bn.
“We have looked at tens of options across Europe,” Sciortino says, including “standard suspects” — the UK, Germany, Italy, Spain and France — and some “non-standard suspects” — countries where fusion development is younger.
Stellarators
Nuclear fusion is the process of combining atoms to release energy, recreating a similar process that occurs in the sun’s core.
Proponents say fusion could create virtually limitless amounts of clean, safe energy, with less harmful byproducts than nuclear fission — the type currently in use.
Proxima is building a stellarator — a device which uses magnets to suspend hydrogen plasma which is heated to extreme temperatures so its nuclei fuse. Stellarators are a more viable route to commercial fusion power, Proxima says, as opposed to traditional tokamaks — a device pioneered by Soviet scientists in the 1950s.
“We are convinced that our first stellarator is going to be much better than any tokamak or any other laser fusion system that we have,” says Sciortino.
Italy bets on fusion
Funding fusion development is cap-ex intensive and Sciortino thinks Europe only has the capacity to support a few players.
“We're being recognised as the inevitable winner on European soil, and so you have geopolitically important investors joining in and saying, ‘the time has come, we need to come together around this horse’,” he says.
Proxima is not Europe’s best-funded fusion startup, that title belongs to fellow German company Marvel Fusion, which has raised €385m in total, including a €113m Series B earlier this year.
Proxima’s new funds bring Italy onto its cap table, which already included backing from German state funds.
“Italy’s current government has expressed a strong interest in fusion,” says Sciortino. The country is already home to a supply chain of key fusion ingredients, including the steel structures needed to build tokamaks and stellarators.
Lobbying governments has become a key part of Sciortino’s work, he says — and it’s something he enjoys. “We are trying to build something bigger than ourselves, bigger than any private company can,” he says.
China and the US
Although investors are piling into European fusion startups, their funds are dwarfed by the amounts being raised in the US. Sam Altman-backed fusion startup Helion raised $425m in January this year, while Bill Gates-backed Commonwealth Fusion Systems raised $1.8bn in 2021.
The US has seen a declining mandate for climate-friendly energy sources under current President Donald Trump. His presidency shows that Europe needs a self-reliant nuclear industry, Sciortino says, adding that Proxima has seen researchers leave the US and join its 100-strong workforce in the aftermath of Trump’s appointment.
China is also a powerful player, though it’s only recently started looking at stellarators.
“China has a very ambitious programme,” says Sciortino. “They're not very verbose about it, but a number of things are understood. They’re building more than one machine at the same time and they are diversifying the risk portfolio quite a bit.”
“You don't want to pick a fight with Europe. The number of people, the supply chain, the sheer scientific and engineering skill — you can’t ignore it,” he says. And, although the US is ahead on tokamak development, Sciortino says it’s Europe that’s leading on next-generation fusion technology.
