Daniel Ek, the founder, and CEO of Spotify has invested in Tesla’s rival, Northvolt. This Swedish battery firm is building a Gigafactory in Sweden’s Lapland region.
Daniel Ek pledges one-third of its wealth to the development of European tech
On Tuesday, Northvolt announced that it successfully raised $600 million in equity funding from Daniel Ek, Cristina Stenbeck, a Swedish businesswoman, and other investors like Norrsken VC, Baillie Gifford, Bridford Investments Limited, Baron Capital Group, and PCS Holding. Also, participating in the fundraising were Northvolt’s shareholders IMAS Foundation, Goldman Sachs Merchant Banking Division, Volkswagen and, Scania.
Recently, Ek pledged to finance close to $1.2 billion of his wealth into moonshot “bets” in Europe. As per Forbes, Ek has a net worth of $3.7 billion, which means that he has allotted a third of his wealth to finance the European tech.
Northvolt to use the new funds to develop a giga-scale recycling factory
Headquartered in Stockholm, Northvolt is known to develop the world’s greenest lithium battery. Founded in 2016 by two former Tesla executives, it is focused on producing batteries that could be used to power the new electric cars produced by Europe’s largest automotive manufacturers.
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Currently, it is building a Gigafactory that will produce batteries in Skelleftea, northern Sweden. It expects to commence production in 2021. The company stated that it is set to increase the production of battery cells and systems with the new funding. It will also use it to double the size of its labs and develop a giga-scale recycling factory. This factory would be capable of recycling lithium, cobalt, manganese, nickel, and other metals.
Northvolt is also applying for a permit to set up its second Gigafactory facility in Salzgitter, Germany. It expects its operations to begin in 2024.
BMW signs 2 billion euro contract for battery cells with Northvolt
The Swedish firm had raised around $1 billion from Volkswagon, BMW, and other similar companies last June. Also, in July, it announced that it had raised $1.6 billion from a consortium of commercial banks, public financial institutions, and pension funds. This fund included a $350 million loan from the European Investment Bank, a publicly held institution having EU member states as its shareholders.
Northvolth also signed a battery cell contract worth 2 billion euro with BMW that will use the former’s batteries in its upcoming electric cars.