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May was a month of shovels both hitting the ground and being laid to rest, restructuring, and hydrogen projects demonstrating how initial market positioning determines whether you get an FID or get fired. Also, some familiar names are stumbling in familiar ways. The Good News Kairos Power Hermes 2 broke ground in Oak Ridge in late April/early May, making it the second advanced reactor under construction in the US alongside TerraPower. The project aims to power Google data centres, although, by the time Hermes 2 is completed, I guess that the data centre in question will be running on solar/wind/batteries for some time. Still, two advanced reactor groundbreakings in a single month — America's nuclear dry spell is officially over. Now comes the hard part: actually building them on schedule. Commonwealth Fusion Systems (SPARC) installed a 106,000-pound (53-ton) vacuum vessel segment and announced that the reactor is at 75% completion in Devens, Massachusetts. They also filed the first-ever US grid interconnection request for a fusion plant with PJM. Both milestones are impressive in their own right. It is worth remembering, though, that SPARC is a pilot project, whose sole aim is to demonstrate that a fusion reactor can produce more energy than it consumes. Stegra (formerly H2 Green Steel) unlocked access to €1.5 billion in previously frozen credit lines after meeting delayed milestones with creditors. For the fifth month in a row, since I started monitoring FOAKs, Stegra is fighting for survival. What disappoints me here is that a green steel project, which is, strictly speaking, not a huge necessity now, manages to secure the necessary funding, while Morrow, which worked hard towards EU energy sovereignty, failed to bridge the funding gap. Brevik CCS continues to operate and is delivering real low-carbon cement. Heidelberg Materials used evoZero carbon-captured cement from Brevik for a road project in Redbridge, UK. A FOAK-producing product that gets used in real infrastructure — that's the whole point. ATOME Villeta selected Sungrow Hydrogen to supply 110 MW of electrolysis for its green fertiliser project in Paraguay and secured a $95M loan backed by Dutch development bank FMO. ATOME looks set to start construction and remains one of the few hydrogen projects done right. The Bad News and Warning Signs BP is selling its stake in Net Zero Teesside and the Northern Endurance Partnership. Let's not sugarcoat it: the company that was supposed to anchor UK CCS is walking away to refocus on oil and gas. NZT isn't dead, yet. Construction is reportedly starting, but losing your lead equity partner mid-launch is not a confidence signal. ZeroAvia lost its founder and CEO Val Miftakhov, following earlier staff cuts in both the US and UK. Securing extra funding at the beginning of the year didn't seem to help. ZeroAvia is following fast down the same flight path as Universal Hydrogen, which, I'd say, is the only flight path available to hydrogen aviation. Climeworks Mammoth is recovering from earlier setbacks and talking about cost reductions, but a WSJ report notes that engineered carbon removal costs are actually going up, not down. The whole thesis depends on a learning curve. I mean, learning that DAC eventually is as futile as hydrogen aviation. The Noise NEOM Green Hydrogen got another round of breathless coverage about its $8.4B mega-plant, but rumours surfaced that all construction on the project has been halted until 2030. Key Takeaways Two advanced nuclear reactors broke ground in the US in the same month. That hasn't happened in decades. Execution from here will determine whether this is a renaissance or just a photo op. My bet is on the latter. Hydrogen souffle (hat nod to Michael Liebreich) continues to deflate amid ZeroAvia travails. BP exiting NZT is a warning for every FOAK that depends on a major corporate anchor. Strategy pivots at HQ can orphan a project overnight. Next month: SPARC should be approaching final assembly milestones; we'll be watching whether Stegra actually accelerates construction now that the money is flowing, and whether ZeroAvia announce a pivot away from hydrogen now that the CEO is gone. Stay tuned.

My closest encounter with mining was in a hotel. It was morning, and the window was covered in a thin layer of black dust from an open-pit coal mine, five kilometres away. The city of Krasnokamenks lies just 100 kilometres from the border with China. It takes a six-hour flight from Moscow and a ten-hour drive to get here. Apart from the coal mine, this small and rundown city is famous for having the only uranium mine in Russia, and for having three large prisons nearby, one of which "hosted" Mikhail Khodorkovsky, the tycoon who first dared to defy Putin. At that time, I was a chief investment officer for a company operating five combined heat and power plants, one of which was right there, powering the uranium mining and the city with coal from another mine. If you do any business that involves making physical goods or energy, if you go up the value chain far enough, you will end up at a mine entrance. When I started working in wind energy and wind turbine manufacturing, and later in lithium-ion batteries, I had colleagues and friends sending me news articles and videos of children in Congo mining cobalt and copper by hand. Then, while trying to secure materials for my gigafactory, I realised that most of it would come from China. Even if the nickel could be mined in Russia, it would still be refined in China. I was aware of the mining and materials problem in the energy transition, but I haven't come across a comprehensive and clear view of this problem. Until I picked up a book by Henry Sanderson, "Volt Rush: The Winners And The Losers In The Race To Go Green". Here is why I think you should read it, if you are working in cleantech or if you are simply interested in what it takes to go green. Mining is a shady business, done in shady places. Well, mostly. More often than not, getting access to mines required bribing, ahem, backing the right local warlord or politician in a time of great uncertainty. From Congo cobalt mines, to Peruvian lithium plateaus, to Indonesian and Russian nickel deposits, everywhere where institutions were weak, adventurers, opportunists or unscrupulous businessmen were taking advantage of the moment to secure critical mineral resources and enormously enrich themselves. The first part of the book reminded me of another book I've read "The World For Sale" by Javier Blas and Jack Farchy. The book explored the murky world of international commodity traders like Glencore, Vitol, Trafigura and Gunvor. Some of them, like Glencore, also appear in "Volt Rush". The tricks, tools and tactics are the same. The level of risk and reward is so insane, it would scare the pants off any venture capital partner. I don't know any VC who would be willing to fly into a war-torn Libya to cut an oil deal, or stay in a hotel in Kolwezi in Congo in the middle of an armed rebellion and bodies lying in the street. The mining industry and commodity trading are tough, highly risky businesses with their own rules. One of the things the book does well is demonstrate how the worlds of mining and clean technology collide, how they reshape each other, and how dependent the green revolution is on what we can dig up. It is not all doom and gloom, as it might seem. When VW tried to bully metal traders into long contracts at take-it-or-leave-it terms, and locked the trades on an empty stadium in Germany, they quickly and painfully learned that mining and commodities do not play by automotive OEMs' rules. But the process was hilarious. In another example, the European auto industry was the only lever good enough to enforce ethical behaviour by miners. The refusal of European carmakers to source cobalt mined by children, and the enforcement of workers' health and safety measures, led to significant improvements in the ways many minerals are mined, not only cobalt. But while US and European buyers were looking to transform the ways minerals reach their assembly lines, Chinese buyers had none such concerns, at least until pushed hard by their Western clients. The book left me with a clear impression that China developed all the clean technology not out of love for the planet. In fact, it seems like environmental issues were never considered. Chinese dominance in clean technology is firmly rooted in the desire of its leadership not only to be technologically independent but also to dominate entire industries. The book provides numerous examples of complete disregard for the local communities and the environment by Chinese companies, whether it is polluting rivers and beaches in Indonesia while mining for nickel, or turning a blind eye to child labour in cobalt mines in the Congo. But the most interesting part of the book for me came closer to the end, when Mr Sanderson wrote about what seemed to be a rise in European battery manufacturing from 2018 to 2022 through the lens of Northvolt. The recent quote from Robin Zeng, CATL CEO, that Europeans cannot make a battery because they have the wrong design, wrong process and wrong equipment is well known and shared. What was not known to me is that the same Robin Zeng, in 2019, called on China to introduce carbon emission limits similar to Europe, fearing that without them, China would not be able to compete. Sanderson shows that as early as 2017, European bureaucrats were very much aware of the risks of growing dependent on Chinese technology and supply chains: "We cannot sit idle while China is taking control of all the supply", said Maroš Šefčovič, then EU vice president, in 2019. Sounds familiar, right? Well, we all know how that worked out. The book was first published in 2022. The COVID-19 pandemic just ended, and there was a genuine hope for the European battery industry's success. Despite the flop of Britishvolt, new gigafactories were being announced, and many were under construction. The future looked bright. But more than three years after this book was published, the EU and the West in general still hadn't made much progress, either in producing batteries or in securing the necessary raw materials. I would recommend this book for anyone working in energy transition and cleantech. It helps to build a holistic understanding of how the world works and the true costs of energy transition. The best part of the book is that it doesn't fall prey to the "Nirvana fallacy" argument. It doesn't argue that failures in mining mean the energy transition should be abandoned. What it does is bring those failures to light so they can be examined and acted upon.

When you raise your first rounds, you are selling a dream. Customers are thin, your burn is low, the road ahead is long, and most of the risks aren't even visible yet — so investors settle for a story, or, as it's more politely called, a vision. By the time you're raising for your pilot, demo, or FOAK, that conversation has changed entirely. Investors want to know when the offtake will sign, who your EPC is and why, whether your suppliers are committed enough to weather another geopolitical shock, and how you plan to keep the senior engineers you've spent two years training. You are no longer selling a vision. You are selling your ability to draw a plan and execute it across dozens of moving parts. This is structural. The VC who came in at seed never really expected you to make it — the bet-spreading model assumes most companies in the portfolio will fail, and one or two outliers will return the fund. The investors you talk to now — strategics, infrastructure funds, governments, impact funds — write checks an order of magnitude bigger, and they cannot afford that posture. They want to be as sure as possible that you'll return the money. Risk, which sat in the background of your earlier conversations, is now in the foreground of every meeting. I learned in finance school that risk is the silver lining of investment, and the simplest way to look at it is as a tradeoff between greed and fear. Early on, your investors are greedier than fearful. By FOAK, fear is calling most of the shots. Each of them looks at your project through their own lens, and each one cares disproportionately about one or two specific risks rather than the full risk register. The framework below is built around this asymmetry. When talking to investors, you don't need to map every conceivable pitfall. Instead, walk them through the four risks that matter to almost every late-stage investor, and then learn how to identify the investor-specific one that will tip their decision. Step 1. Address technology obsolescence risk In 2021, Renault and Plug Power formed Hyvia, a 50/50 joint venture to build hydrogen fuel cell vans for European fleets. The credibility behind it was substantial. Renault is one of Europe's largest automakers, with a hundred-year-old distribution network and the engineering depth that comes with it. Plug Power was the listed US hydrogen specialist that institutional cleantech investors had spent a decade chasing. Hyvia set up a fuel cell assembly and testing plant at Renault's Flins facility in Yvelines, hired around 110 people, approved two production versions of the Master H2-Tech van in 2023 and 2024, and had a third generation in development that they previewed at the IAA and the Paris Motor Show. By December 2024, they had filed for bankruptcy. In February 2025, the Versailles Commercial Court placed them in liquidation after no credible takeover offer surfaced. The technology worked, the vans were real, and the factory ran. What didn't show up was the market. Renault CEO Luca de Meo, testifying to the French National Assembly's Economic Committee shortly before the liquidation, was blunt: despite considerable investment and numerous public subsidies, hydrogen passenger and light commercial vehicles "are not selling due to a lack of demand." His own framing was that hydrogen would eventually find a role in long-haul heavy trucking and perhaps green steel, "but I see things taking off more slowly than we expected." Hyvia's own statement echoed the same conclusion — that the failure traced back to "the too slow emergence of hydrogen mobility ecosystems in Europe and the very significant development costs required for hydrogen innovation." Over the same four-year window, battery-electric vans in the same class crossed the 400-kilometre range threshold, depot charging proved trivial to install at a fleet's own yard, and the fleet buyers Hyvia needed concluded that for almost all of their duty cycles a battery van was simpler, cheaper to fuel, and serviceable at any fast charger they happened to pass. The hydrogen van wasn't beaten by a better hydrogen van. It was beaten by an adjacent technology that improved faster than the hydrogen ecosystem could be built around it. This is the version of obsolescence risk that investors at your FOAK stage press hardest on. It sits outside your factory walls, and it is hard to mitigate. You name the substitute technologies most likely to move while you're building, you draw out both their cost curves and their infrastructure curves to the year your FOAK commissions, and you are honest about where you land at that intersection. A project pitched against a 2021 lithium-ion cost curve and a 2021 European fast-charging buildout is not the same project when its FOAK switches on in 2026. Investors don't expect you to eliminate the risk. They expect you to have looked it in the face. Step 2. Address competition risk When I pitched the case for building a lithium-ion battery plant in Russia, one of the Rosatom board members told me a story about the time the corporation tried to enter solar panel manufacturing in the early 2000s. They invested in the technology, built a small line in Kazakhstan, and by the time the line was producing panels, the global cost curve had moved so far down, and the technology had advanced so far that the factory could not stay competitive. They closed it and walked away. I've watched the same story play out across solar, wind, lithium-ion cells, and electric vehicles — technologies developed in Europe and the US, then manufactured cheaper and at scale by China. It's so common now that "can the Chinese replicate this?" is a default question in every late-stage cleantech meeting I sit in. The honest answer is usually yes, they can. This is why founders need to be sober about what their actual moat is. The IP moat — the patents you're proud of — sits at the front of every deck and matters much less than founders or early-stage investors think. If your IP leaks and a Chinese rival builds a FOAK faster than you, litigation will enrich your lawyers and bankrupt your company while they scale. Show the patents, but don't pretend they're the armour. The harder moat is know-how — the kind encoded in your team's hands and habits rather than in a filing. There's a reason the best car engines are still made in Germany and the best battery cells are still made in China. Demonstrating know-how is harder because most investors don't have the manufacturing background to feel its value. You show it by spelling out, concretely, why the scale-up cannot be executed without it. The third moat is regulation, and it cuts both ways. At NovaWind, the Russian wind manufacturer where I served as director for business development, strategy and manufacturing, the policy moat was decisive — the government's local content regime guaranteed favourable prices only to domestic producers. CBAM, IRA (now largely defunct), tariffs, procurement rules and local content requirements can all do this for you. They can also be reversed in a single election cycle, as the IRA's recent fate has shown. Politically supported moats can win you the round today. Cost discipline, customer obsession and know-how are what keep you alive after the policy turns. Step 3. Address commercial risk I've worked the two extremes. In 2016, when I pitched the wind turbine factory in Russia, there was effectively zero commercial risk — the first step of the project was a government tender that guaranteed ten years of wind energy sales at attractive prices, locked in before a single piece of equipment was bought. Five years later, I was pitching an 8 GWh lithium-ion battery factory, and the difference was that I had zero customers. KAMAZ, the largest Russian truck and bus manufacturer, had signed a non-binding offtake term sheet with Renera, the company I was running, but they were buying cells from CATL for their electric buses and were only cautiously exploring passenger EVs. Two projects, same founder, opposite ends of the commercial risk spectrum. Commercial risk usually carries the most weight in the investor meeting, because customers are the only real proof that someone wants what you're building. The cleanest signal is a binding offtake, underwritten by a credible counterparty. My wind project essentially had that, with the Russian government as the buyer. That is rarely what FOAK founders have. More often, you arrive at the pilot raise with a handful of LOIs, maybe an MOU, and ideally a customer trial that has returned positive results. Battery startups tend to start joint trials before pilot, which is why most of them have something more than a piece of paper to show. The weakness of LOIs is that they say nothing about price. So you need to be ready to explain, outside any specific customer dialogue, why anyone will pay more for your product than for the existing alternative. And, no, it is not the green premium. The green premium is dead — no one underwrites a project on the assumption that customers will pay more because the product is cleaner. That leaves two real reasons for a customer to absorb a premium. The first is a regulation that forces them to: CBAM, local-content rules, import tariffs, carbon pricing, or some combination. The second is the disruptive-innovation case Clayton Christensen laid out, where a niche customer group is paying a premium for an existing product they're already unhappy with, and your product solves something that group cares about. Early solar panels lived in this niche before utilities cared, powering telecom relay stations and US military forward operations in Iraq. A strategic investor on the cap table, or even seriously in discussions, exerts gravitational pull on VCs and financial investors who read their participation as a commercial signal. I have my reservations about strategics — they can crowd out future customers and complicate exits — but in markets dominated by a handful of incumbents, like nuclear, partnering with one of them can be the only realistic path. And if none of this applies, if you're in fusion or direct air capture and there is no immediate demand at all, the argument becomes strategic. The case I made for the battery factory was that lithium-ion is a foundational technology of the new energy infrastructure, with intermittent generation on one side and the rise of the prosumer on the other. Some investors will place a long bet on strategic positioning when they cannot underwrite near-term demand. Step 4. Demonstrate FOAK execution risk control "Emin, you don't have any experience in battery technology or battery manufacturing. Why should we hire you to lead our gigafactory project?" That was my pre-final interview at TVEL, a Rosatom subsidiary, for the CEO role at the company that would become Renera. They were worried about execution risk, because a decade earlier they had been part of an attempt to build Russia's first gigafactory near Novosibirsk, and that project had failed spectacularly. They knew first-hand what execution risk looks like when it hits. Execution risk isn't one risk; it's four — construction, ramp-up, supply chain, and team. Construction risk is the most immediate, and your story here is mostly determined by how you handle EPC. A Tier 1 EPC with experience in similar projects has a calming effect on investors; ATOME secured one for its Villetta green ammonia project and raised accordingly. Going without an EPC is also a defensible choice if the arguments are rock-solid. JR Energy Solution built a 500 MWh electrode factory in nine months without one, and they could defend that decision because they were building inside an industrial park with infrastructure already in place, several of their equipment suppliers were on the cap table, and the founding team had personally built and run battery lines before. Ramp-up risk is what the pilot-demo-FOAK sequence is designed to attack. For investors, list the ramp-up risks you've identified at each stage, align them with your mitigations, and find anecdotal evidence from adjacent industries to anchor your timeline assumptions. Nothing beats a comparable project. If you can outsource the ramp-up altogether through a foundry-style partner, even better. JRES does exactly this for battery startups looking to produce their first commercial-grade batch — adapting designs for large-scale manufacturing, finding and resolving ramp-up problems before they hit the customer's lab, and training the startup's own team on the way. Supply chain risk is the one I see most often overlooked. In March of this year, at InterBattery in Seoul, I had multiple conversations with Westerners asking whether a 100% China-free battery supply chain is achievable — a question that wasn't being asked a year ago. Geopolitics aside, FOAK founders should worry more about being deprioritised by a tier-one supplier the moment a larger, less risky customer places a rush order. The strongest demonstration of supply chain control is a critical supplier on your cap table, which is rarer than it sounds but more common in FOAK than in software. Failing that, you want either a diverse supplier pool that can be swapped without friction, a supplier with their own strategic reason to participate, or — at minimum — a procurement lead with deep, named relationships at your key vendors. Team risk is the most overlooked of the four. Investors don't want to hear the org-design philosophy. They want to shake hands with the person on your team who has personally solved the risk they're most worried about. If the supply chain is the concern, they want to meet someone who has bought from those exact suppliers for fifteen years. For every major risk you can't cover with a full-time hire — and you won't be able to cover most of them, because the people you'd want are hard to pry loose from their current jobs — the next best thing is the same kind of person as an advisor. You save the salary, you get the practical advice, and you give your investors a name and a CV they can read. Step 5. Identify the one risk that will actually decide it In many of the conversations I've had with potential investors and partners, I've felt they weren't telling me the whole story. There was always something — a real deal-breaker — that they were hesitating to put on the table. Sometimes they wanted to know me better first; sometimes they were still forming their own view; sometimes the person across from me wasn't the actual decision-maker; sometimes they weren't really interested and were just being polite. But when I could get it out of them, it always turned out to be what actually mattered, and addressing it always led to the deal being either closed or dropped fast. The four risks above will get you 80% of the way there. The fifth step is finding the one risk that will decide it for the specific investor in front of you. The only reliable way is to ask, but you have to ask carefully. The first answer is rarely the real one — investors follow templates, they have cultural defaults, they're shaped by whatever came up in the morning's investment committee. Let them name everything that bothers them first. Then, only at the end, ask which of these they consider most critical to their decision. Forcing them to revisit and rank their own list often surfaces a concern they hadn't named at all. Be especially attentive to the quiet person in the meeting who asks one piercing question at the end — that person frequently holds the real power and names true priorities. Don't try to address every risk in every conversation. You identify the one risk that will decide it for this investor, and you build a tailored answer to that one. The Pareto principle applies: the top 20% of risks tend to dissolve the remaining 80%. The framework, and the one risk it can't cover In the summer of 2018, Adam Neumann chartered a private jet to fly from the US to Israel, allegedly smoking marijuana the entire way. He leased buildings he personally owned back to WeWork. The company collapsed, and he walked away a billionaire. SoftBank lost sixteen billion dollars. The five-step framework covers four investor-side risks — obsolescence, competition, commercial, execution — and then the fifth, investor-specific one. What it can't cover is the principal-agent risk, the lack of trust that sits underneath every investment relationship. Agent risk is mitigated by trust, and trust is built slowly. The framework is designed to demonstrate to investors that you see what they see, understand the same risks they do, and have a credible answer to each. It is the structured part of trust-building. Your fears and your investors' fears are the same fears, looked at from different ends of the same room. You control most of the risks; they fund the risk-taking and bear the downside. Your job is to demonstrate, concretely and specifically, that you will spend their money the way they would spend it themselves. If you are preparing for a FOAK raise and feel that the deck and the data room you used for your last round have stopped landing the way they used to — that the conversations have moved from vision to risk, and you're not yet speaking that language fluently — that is usually the gap this framework is built to close. I work with founders specifically on this transition, between the VC pitch and the project finance pitch, and on the four-plus-one risks above as they show up in your specific company. If that's where you are, book a call.

April was a month of lifelines and groundbreakings. Some projects got exactly the rescue they needed; others got exactly the ceremony they needed. Let's sort the real from the theatrical. The Good News Kairos Power broke ground on Hermes 2 in Oak Ridge, Tennessee — a 50 MW salt-cooled Gen IV reactor that will be the first power-producing Gen IV plant permitted in the US. Google data centres in Tennessee and Alabama are the offtakers. It seems that the Senate hearings over the last month were not an obstacle to putting shovels in the ground. This is how you build credibility in advanced nuclear: get Hermes 1 permitted, learn from it, then scale. Textbook FOAK sequencing. Stegra secured €1.4 billion in new financing led by the Wallenberg family to complete its green steel mill in Boden, Sweden, including a 740 MW renewable hydrogen plant. Let's be clear: this was a rescue, not a victory lap. The project was in serious financial trouble, and the Northvolt ghost was hovering in the background. But the money is in, the path to completion is now fully funded, and construction should accelerate. Europe's most important industrial decarbonization FOAK lives to see another day. Total required financing is north of €2 billion, so they are not out of the woods yet. ATOME reached Final Investment Decision on its $665 million Villeta green fertiliser plant in Paraguay — the world's first industrial-scale green fertiliser facility. That's on the back of $420M in debt, secured last month. Subsidy-free, 145 MW electrolyser, 60,000 tonnes per annum. FID is not construction completion; for a project of this type and scale in Paraguay, without subsidies, this is a genuine milestone. Hats off to Olivier Mussat and the team! If you want to lear more, you can watch my interview with Olivier here. Net Zero Teesside continues advancing toward its 2028 launch, with construction on the 742 MW gas power + CCS facility ongoing since mid-2025. Meanwhile, BP announced it will sell stakes in the project to bring in new partners. It could be a pragmatic move to share risk as construction ramps up. The Bad News and Warning Signs Mitsubishi Heavy Industries stated publicly that green hydrogen-based direct reduced iron is "not economically viable" in Europe today. This isn't news to anyone watching the space closely, but having a major industrial player say it on the record puts pressure on every H2-DRI project on the continent — Stegra included. The €1.4B buys time and steel but doesn't fix the underlying economics. Microsoft may be stepping back from carbon removal purchases, according to MIT Technology Review. This is a serious demand signal problem for the entire CDR sector. Climeworks signed a new offtake deal with NTT Data — despite zero info on whether their tech can actually sequester any meaningful amounts of carbon. Anyway, one Japanese data centre firm does not replace the industry's largest buyer, getting cold feet. The Noise Lyten's Northvolt acquisition continues generating impressive press releases about a "$5 billion battery empire" built on lithium-sulfur technology. What we have so far: acquired assets from a bankrupt company and ambitions. No production data, no cells shipped at scale (ok, might be a bit too early for that). I'll track it, but this is still a PowerPoint at an industrial site. NEOM green hydrogen offered reassurances that construction "has not been affected" by the US-Iran conflict. Noted. But the broader green hydrogen narrative continues to erode — costs remain high, infrastructure gaps are real, and timelines are slipping globally. Eavor-Loop Geretsried got some favourable coverage about its closed-loop geothermal system in Bavaria. The technology is genuinely interesting, but the April news was features and op-eds, not utilisation updates. Key Takeaways Rescue ≠ validation. Stegra's €1.4B is essential, but the Mitsubishi H2-DRI viability warning on the same continent in the same month should keep everyone sober. Funding secured; unit economics not yet proven. Kairos is showing how FOAK sequencing should work. Build small, learn, get permitted, then break ground on the next one. Other advanced nuclear developers should be taking notes. CDR demand is fragile. If Microsoft wobbles, the entire voluntary carbon removal market feels it. Climeworks and others need to diversify buyers fast. Or save everyone some time and forget that CDR will ever work. Next month: I'll be watching for Stegra construction acceleration in Boden, Hermes 2 early construction progress, and whether the Microsoft-CDR story gets worse. See you in June!

EBA250 Brussels: The Cash Curve, The Brussels Parcour, and the Missing pCAM A few weeks ago, I sat through a closed roundtable organised by EBA250 in Brussels, my second in a month. In a room were people from Verkor, ACC, and PowerCo, alongside a number of European Commission officials whose near-term job will be to decide how roughly €1.8 billion of new European battery money actually gets deployed. The strategic message from the Commission was unambiguous, and in itself genuinely new: decoupling the battery supply chain from China is now a stated priority, and the new financing instruments — principally the so-called Battery Booster, around €1.5 billion aimed at scaling cell manufacturing, and a separate €300 million envelope for localising upstream materials — are being structured around that goal. What was less clear, listening to the gigafactory operators in the room, was whether the instruments, as currently drafted, will do the job they are being asked to do. The gap between the Brussels strategic intent and company's operational situation is still there, and it seems that it won't be bridged any time soon. The Cash Curve The immediate gap, and the one on which Verkor, ACC, and PowerCo were notably aligned, is that ramp-up costs at gigafactories are running materially higher than internal plans had assumed. The support these companies need is not capex grants for the next line but operating support to get the lines they have already built through the long, ugly stretch between commissioning and stable yield. The Battery Booster, as currently designed, contemplates loans against working capital, repayable over one to two years. To anyone who has run a battery line through a ramp-up, that will read as a structural mismatch. When I was running RENERA, one thing that was clear was that the cash burn during ramp-up is not really working capital in the textbook sense. You are not financing inventory that will turn into receivables on a predictable cycle. Instead, you are financing the discovery process by which you learn how to operate your own factory at the cell-chemistry, equipment, and process-control level. That discovery does not amortise over a one- to two-year schedule. What the gigafactory operators in the room were politely asking for, and what they will say less politely in private, is that the proposed instrument is simply postponing a problem instead of fixing it. The Commission will end up reorganising the same balance sheets a year later under worse conditions. The Brussels Parcour The second, related issue is that the Battery Booster is currently scoped to engage late in the production cycle, whereas the operators want access from C-batch onwards — that is, from the point at which final cell qualification with a customer is in progress, and commercial production is genuinely imminent. This is not a small distinction. C-batch is precisely the phase at which cash demand spikes hardest, headcount has to be in place ahead of revenue, fixed costs are running at full, and the temptation to cut corners on quality discipline is at its most dangerous. Money that arrives much earlier than commercial production has stabilised arrives, by definition, before the period of greatest risk. You can build a defensible case for any cutoff date, but if the policy goal is to get European cell capacity through the FOAK valley of death, the instrument has to engage with the part of the curve where the valley actually is. There was also a procedural point made forcefully by ACC, which is worth repeating because it reveals how policy ambition can defeat itself. ACC's Innovation Fund application ran to over seven hundred pages, required two full-time employees over the duration of the process, and involved a number of external subcontractors. That is the cost of compliance for a company which, by the nature of what it is trying to do, has roughly nobody to spare. The operators in the room were explicit that they hope the Battery Booster application will be calibrated to the actual capacity of scale-up companies to absorb it. For a cleantech founder reading this from outside the gigafactory cohort, the lesson generalises: any European industrial policy instrument whose application burden is set without regard to the applicant's operational headcount is, in practice, designed for the companies that least need it. The Missing pCAM The most strategically uncomfortable point of the afternoon, however, was about pCAM. There is currently no manufacturing of precursor cathode active material in the European Union, and pCAM is not included in the local content requirements of the Industrial Adjustment Act. This is an odd gap to leave open in a strategy whose explicit purpose is decoupling, because pCAM is the chokepoint where Chinese supply chain dominance is most acute and most difficult to displace. Without European pCAM capacity, the European recycling industry has a structural demand problem, as pCAM producers are the principal buyers of black mass; a recycling facility that cannot sell its output into a regional pCAM customer is a recycling facility whose business case collapses, regardless of how clean the technology is or how favourable the permitting environment. You cannot build a circular European battery economy with the circle broken at its most important node, and you cannot meaningfully decouple from China by funding the cell layer while leaving the precursor layer unaddressed in both the financing instrument and the local content rules. The Takeaway What I took away from the day is that the strategic intent in Brussels is now in roughly the right place, which is genuinely new, and that the people drafting the instruments are listening, which is also new. What remains unresolved is the gap between the political shape of the instruments and the operational shape of a gigafactory ramp-up. The Battery Booster, as currently sketched, looks like an instrument designed by people who have not personally watched a cell line miss its yield targets for nine consecutive months while the working capital line is disappearing faster than anyone modelled. The next six months of consultation will show what the final design will reflect. If you are running a European battery scale-up and trying to think clearly about how to position your project against the Battery Booster, the localisation envelope, or the IAA local content provisions — particularly if you are between B-sample and C-batch and looking at a working capital gap that the current loan structure will not bridge — this is the territory I work in every week. You can find me at askerov.pro or book a call directly to talk through where your project sits on the FOAK cash curve and which of the new European instruments is worth the application effort.

Investors don't know what FOAK execution risk is. But they worry about four other risks. "Emin, you do not have any experience in battery technology or battery manufacturing. Why should we hire you to lead our gigafactory project?" It was my pre-final interview at TVEL, a subsidiary of state nuclear corporation Rosatom, for the position of CEO of a newly formed company to localise lithium-ion battery manufacturing in Russia. They were worried about execution risk. A decade earlier, they had participated in the project to build Russia's first gigafactory near Novosibirsk. That project failed spectacularly, and so they knew first-hand all about execution risks. When investors say they are worried about execution risk, they aren't worried about one thing. They are worried whether you can complete your FOAK on time and on budget. They are worried about whether the ramp-up stage will take longer than expected, or how quickly the scrap rate will decline. They are worried that your suppliers will ditch you at the last minute. And they are worried that the team you are hiring doesn't have the necessary experience. Execution risk is not a single risk but a collection of risks: construction risk, ramp-up risk, supply chain risk, and team risk. However, the way you work on them and the way you position them before investors are two different things. Let me walk you through the positioning thing. Start with construction risk It is the most immediate of the four, and it serves well to pull the others together. Control of this risk is largely determined by whether you choose or not to hire an EPC contractor, and the reasons behind that choice. Hiring a major, respected EPC company with years of experience on similar projects usually has the most reassuring effect on investors. ATOME secured a Tier 1 EPC contractor for its Villetta green ammonia project and subsequently achieved significant fundraising success. Going without an EPC is also an option, but your arguments have to be rock-solid. JR Energy Solution built its 500MWh lithium-ion electrode factory without an EPC in just nine months. They argued to their investors that, as they were building in an industrial park with all the infrastructure readily available, with their equipment provided by several of the investors, and with the team's deep experience in battery buildout and manufacturing, hiring an EPC would simply drive up the costs without meaningfully adding control. Then layer on ramp-up risk Building factories or projects is one thing; making them operate to design parameters is another. The pilot-demo-FOAK path exists specifically to work out ramp-up technical difficulties before full commercial deployment. For your investors, list the key ramp-up risks you and your team identified for each stage of that path, and put your main mitigation measures opposite them. Then find examples from adjacent industries or projects to demonstrate why your assumed timelines are relevant and what usually goes wrong. Nothing beats good anecdotal evidence from similar projects. Where possible, outsource the ramp-up risk altogether. Some industries have what are known as "foundries" — facilities that can produce a small pre-commercial batch, or even a small commercial-grade batch, of similar products. They usually have the know-how and the supply chain in place and can incorporate your design relatively easily. JR Energy Solution provides exactly this service for battery startups looking to make their first commercial-grade batch: they help adapt the design to large-scale manufacturing, spot and resolve problems in the ramp-up phase, and train their customers' teams to work at scale. Supply chain risk is often overlooked It has come into the spotlight since COVID and the wars in Europe and the Middle East. In March 2026, while I was at the annual InterBattery show in Seoul, I met many Westerners asking if they could get a 100% China-free battery supply chain — something unheard of just a year earlier. But geopolitical risks aside, FOAK founders should worry more about their suppliers quietly deprioritising a small and risky startup in favour of a rush order from a long-established client. The best way to demonstrate supply chain risk control is to have your critical supplier on your cap table. This sounds just a shade easier than getting rich by being born into a rich family. And yet, in FOAK projects, equipment finance or direct supplier participation is not as uncommon as you might think. It requires a high degree of trust from suppliers for the founding team, but if you have spent a long time in the industry, it is likely that you have developed exactly such relationships. Lacking that, you'll either need to demonstrate a diverse pool of suppliers who could be swapped with relatively low cost and friction, or have a supplier who is invested in your project in some other way — another startup relying on your project to demonstrate its product, or an established company looking to showcase its products in a cutting-edge application. Lacking all of that, your only chance of demonstrating at least some measure of supply chain risk control is to have a procurement manager with deep, longstanding ties to your key suppliers. And finally, the team risk — the most overlooked of all You already know the many challenges of designing, selecting, and bringing together a team for a FOAK. But this is not what investors usually want to hear about. What you have to demonstrate to them is that your team, especially its C-Suite, has the experience to cover the key risks of your specific project. If supply chain risk is a key risk for your FOAK, then investors would like to shake hands with someone who has sourced from those exact suppliers for many years and now works for you. You also know how challenging it is to hire experienced operators full-time at FOAK stage. For any major risk that you cannot cover by bringing on someone who has done it for the last twenty years, the next best thing is to bring the same kind of person on as an advisor. This way you save the money you would otherwise have to pay a similarly qualified full-time hire, you get the experience that investors want to see, and you actually get some good and practical advice along the way. The investor checklist is a goldmine, not a hurdle Earlier in my career, I would often read a social media post or a Substack article by an investor and wonder about their seemingly limited understanding of risk. What I faced with as an operator, and what I've seen wrecking companies, rarely matched what investors preached. Later, I realised these are exactly what founders should be reading — they tell you precisely what to focus on in your investor dialogue. If you have already worked through the frameworks for each of the four risks above, you already know pretty much all of the known unknowns of your project, and you know how to mitigate or insure against them. When talking to investors about risk mitigation, the goal isn't to show how deeply you've thought about risks. The goal is to demonstrate that you tick all the boxes on the investor execution risk checklist. That checklist is shorter and more pattern-matched than most founders expect. If you're a few weeks out from a major raise and your execution risk story still feels like a collection of slides rather than a single coherent argument — covering EPC choice, ramp-up plan, supplier exposure, and team gaps in one breath — that's the kind of work I do with founders. Sometimes, the difference between a defensible answer and a confident one is just a fresh set of operator eyes that has been on the other side of the table.

Building first-of-a-kind (FOAK) cleantech projects is the main thing we can do now to avert catastrophic climate change. We have all the innovations we need, but we fail to deploy them at a sufficient scale. FOAK projects are not about innovation - they are about execution in the most complex, high-stakes environment imaginable.  Over the past two years, I've documented this process, drawing from my own and other founders’ hands-on experience to create a comprehensive, step-by-step guide for cleantech founders and operators. This is still  a work-in-progress , but enough material has piled up that I wanted to structure it and give it an overview. Here’s an overview of the key stages, each linked to detailed articles for deeper insights.  1. Laying the Groundwork for the FOAK Journey Why are you doing it? Will it make a noticeable reduction in CO2, methane, or other gases? Will it genuinely help avert climate change, or will it simply postpone it? How should you start? When do you know that you are ready? Every FOAK journey begins with a solid foundation. Understanding the unique challenges and opportunities in cleantech is crucial. Here, I cover how to move from an innovative idea in the lab to a scalable business model, aligned with real-world energy needs and market expectations. The key articles so far: When are you ready to scale?   The 1% check Why most climatetech startups don’t deliver 10x returns A framework for choosing scale-up business model Do you have a drop-in solution?    2. Financing FOAK  Most of the online articles on FOAK contain funding advice and most of them are written by VC’s whose partners never had to execute a FOAK. In my posts, I examine VCs and strategic investors’ perspectives, provide actionable advice on how to de-risk FOAK, how to avoid strategic investors’ traps, when to take VC’s advice and when not.  From Series A to Series B What do VCs get wrong in cleantech? Navigating the capital stack from lab to NOAK The pitfalls of FOAK capital stack   How to de-risk your FOAK   How important is intellectual property for a scale-up What strategic investors are looking for   How strategic investors can kill a startup   When to listen to VCs and when not   Grants for FOAK How to handle a Board Meeting like a pro  3. Securing Off-take Agreements Off-takes are revered in the FOAK space. They give investors certainty, validate your product, and reduce your next customers' anxiety. Off-takes are more than contracts. They’re signals to investors, anchors for financing, and roadmaps to NOAK. What most available articles fail to provide are the step-by-step instructions and insights to get an off-take. I’ve written a series of posts about each step you need to take to secure an off-take, and provided negotiating tips and tactics from my own experience and those of other founders.  What do you need to know about off-takes? A primer. The road to off-take - what are the main stages of getting there Step one - MOU Step two - letter of intent Step three - term sheet Step four - off-take term Step five - off-take price How to sell to utilities - a case study  4. From Pilot to FOAK to NOAK: Scaling Up You’ve validated the tech—now you need to prove it at commercial scale. These posts cover what it takes to build a pilot, transition to demo, and finally deploy your FOAK. I dive deep into each stage, providing actionable and clear frameworks for execution. What are the three key steps to build a FOAK? How big should your FOAK be? Pilot stage framework Demo stage framework Do you need an EPC for your FOAK? How to select an EPC   Beyond FOAK  5. Building and Managing Your Team You can’t FOAK alone. And your early-stage startup team is not up to the task. These articles share what I’ve learned about building teams that can execute when speed, risk, and ambiguity are all high. What skills are usually missing? Why is it important to hire a chief operating officer? What mistakes did I make in hiring for my FOAK? FOAK management means managing chaos. Are there ways to control it? I am still working on this section and will add new posts on hiring and managing FOAK teams soon.  What skills are usually missing in FOAK Hiring mistakes - my case study CTO - Why do you need him? Simplifying FOAK management   How ATOME built its leadership team The 5-Step Framework for Building FOAK Teams That Deliver  6. Building a supply chain It is said that modern warfare is defined by supply lines, and this is equally true for businesses. Simply managing your supply chain is a big challenge. Building it is a whole new challenge. Sometimes, mapping your suppliers and bringing them together will be straightforward. Sometimes, your supply chain might not exist yet, and you’ll have to build it up from scratch.  How to build a supply chain How supply chain chaos can sink a startup  7. Real-World Case Studies: Lessons from the Field Learning from others' experiences is powerful. These stories show what works—and what to avoid. FOAK lessons from nuclear energy Building wind turbines in the shadow of a nuclear giant Dangers of ramping up battery manufacturing - Fraunhofer report review Redflow - flow batteries failure Canoo - electric minibus failure DAC FOAK success story Vianode - sustainable graphite success story (video) Explore the Full FOAK & Scale-Up Blog Directory For a comprehensive collection of articles, case studies, and resources on FOAKing and scaling cleantech innovations, visit the full blog directory: 👉 FOAK & Scale-Up Blog Directory Whether you're at the ideation stage or preparing for your NOAK deployment, this resource is designed to guide you through each step of the journey with practical, experience-based insights. What would you like to see in an expanded version? What FOAK and scale-up challenges should I cover more?

The boardroom isn't the place where major decisions are hashed out. It's a place where major decisions are officially signed off. More like a ribbon-cutting ceremony. That I learned only when preparing to present at my first-ever board meeting, in the summer of 2012. I expected a full presentation, followed by a discussion, and then a decision. And while on the face of it all went according to this plan, one important thing was off - the decision had already been agreed before the meeting. And that was my doing. Board meetings can make or break a company. The decisions taken in the boardroom determine your strategy, your critical decisions, and how much more cash investors would be willing to put in. Sometimes, the very existence of your company might hinge on one such meeting. This was discussed at length in the wrap-up of a conversation about "down rounds" - when a company is forced to raise equity at a lower valuation than its previous round. A one tough conversation to have. How do you ensure a favourable board meeting outcome? Back to the summer of 2012. The meeting in question was about the reshuffling of ownership of combined heat and power plants inside a corporation. You could call it a down round, since it would reduce the value of assets in some subsidiaries. Understandably, the leadership of most power plants was strongly opposed to losing control, while my task was to push through a decision to consolidate ownership in a new entity. This was a snap board meeting, called in the middle of the summer of 2012. My boss was on vacation, so I had to go in his place. On the phone call, he gave me some advice that was crucial to our eventual success. He told me to arrange a meeting with every board member before the official meeting, go through our arguments, understand their positions, and try to reach a consensus before anyone enters the boardroom. I did exactly that, meeting with every board member, except the chairman. But that was okay, as two other board members briefed him after meeting with me. I've also met the managers of the subsidiaries and negotiated the transfer with all but one. A week later, at the board meeting, six of the seven CHPs were transferred to a consolidated company. The one that was left out did not cause a major debate in the boardroom. The directors generally agreed that the last one should be left out, as it was serving a military research facility, while all others were strictly civilian. The meeting lasted less than an hour, with me giving a short introductory presentation, my opponents voicing their well-known objections, and the chairman formulating a decision. Everyone left the room happy, and I had just created a new company of five CHPs. Later, in all my other board meetings, I strictly followed this framework. Never just call a board meeting, give your presentation and expect a favourable decision. That's a recipe for disaster, especially if the decision is difficult, like a down round. People usually don't take bad news well, and their first reaction is to fall back on what's familiar and protect what they have already invested. Expecting them to quickly see the situation and follow up with more money is a fantasy. The key is to pre-orchestrate it. Hold one-on-one conversations with board members. Clearly show available options and tradeoffs. Make them see the situation from your point of view. Remember that these meetings are not so much about you and your problem, but an opportunity to understand investor motivations and capabilities at this point in time. Regardless of what you think you know about your investor, their current situation might be very different, and their decision might unpleasantly surprise you. When you fully understand each director's current position, you may hash out a decision right there and gain the support of all of your board members, or at least a majority. Now, you might think, "I know my investors well, and anyway, I don't have the time to meet all of them one-on-one!" True, any founder knows that their time is the most scarce resource that they have. What is also true is that as a founder, and especially as a leader of a scale-up, you have to spend your time on things that matter most to your company. Board meetings are rarely called to rubber-stamp some large purchase or your management's remuneration. These are often make-or-break decisions. Failing them could mean you lose your company. Rank your priorities. There is a way, though, to free up some time for a founder while still meeting and prepping all the board members. If you have a trusted advisor, or a deputy (usually a director for strategy or finance) who knows your business very well, who is known and trusted by your board, and whose negotiation skills are battle-tested, you can rely on him or her to do the one-on-one meetings with board members. For many years, I fulfilled this role for my boss, and later, when I became a CEO, I had my finance director take it on. The one-on-one meetings are a concrete example of what people really mean when they talk about "building trust" and "communication skills". Having a non-formal communication, where people can openly ask questions and not publicly and legally commit to a decision immediately, helps a lot. Having someone who has done this many times over is even better. Today, as an independent scale-up advisor, I help scale-ups establish trust and clear communications with their boards. I fill this advisor position and help to pre-orchestrate your board meetings so that they become places where decisions are made, rather than postponed. If you are in the middle of preparing for your next board meeting and feel you could use a little help, a call would be a great place to start.

March brought a mix of real construction milestones, big financing closes, and the usual parade of announcements that may or may not lead anywhere. Let's sort the signal from the noise.  The Good News Stegra  (H2 Green Steel) delivered the headline of the month:  all electrolyser modules are now installed  at their 740 MW green hydrogen plant in Boden, Sweden. That's a real, physical milestone on what is arguably the most important green steel FOAK in the world. The financial picture is messier — they  need to raise over €2 billion  more to finish construction, and investors are reportedly haggling over control — but modules in the ground matter. ATOME  Villeta  closed $420 million in debt financing  for their $650 million green fertiliser plant in Paraguay, with backing from IFC and up to $95 million from the European Investment Bank. They also claim  100% offtake secured . Hat off to the team! For a project most people haven't heard of, this is a textbook FOAK financing milestone: multilateral lenders, full offtake, definitive documents signed. Watch this one.  Net Zero Teesside continues to grind forward. The East Coast CCUS Cluster has now  awarded over £1.5 billion in sub-contracts  to UK suppliers, with construction accelerating. Commercial operations still targeted for 2028. The  political noise around Chinese steel  sourcing is annoying but irrelevant to execution — what matters is that contracts are being let and work is happening on site. Form Energy  keeps stacking commercial deals. After the 30 GWh Google/Xcel project in Minnesota, they  signed a 12 GWh supply agreement with Crusoe  for AI data centers, plus announced their  first international deal (Ireland).  The demand signal from hyperscalers is unmistakable. The real test remains: can the Weirton factory produce at scale and on spec? ACME Group  Odisha  signed a massive 10-year green ammonia offtake  with SECI for 370,000 tpa. That's a significant commercial agreement — but the Odisha plant still needs to get built. ElevenEs  didn't make the news this month, with construction underway, and nothing major to report. Still,  Nemanja Mikać , ElevenEs CEO, published an interesting post on why they decided to skip turn-key solution for their mega factory - read it  here .   The Bad News and Warning Signs  Stegra's financing gap deserves a second mention — on the warning side.  Needing €2 billion+ on top  of what's already been raised, with investors fighting over governance, is not a comfortable place for any FOAK. The  Koç Group partnership  helps, but this project is not yet fully funded (and if I know anything about working with Turkish investors, this is going to be a tough one!). Electrolyser installation is great; running out of money before the first steel is not.  Brevik CCS (Heidelberg Materials) had no project-specific construction news this month. Heidelberg  reaffirmed its CCS strategy  while simultaneously closing plants to cut costs. Strategy reaffirmation updates while closing plants is definitely a warning signal.  The Noise NEOM Green Hydrogen Company  — another month of  market reports ,  stock commentary,  and  geopolitical positioning  pieces. Zero construction updates. This project can't shake its reputation as a market research PDF generator.  Kairos Power  appeared in  Senate hearings ,  policy discussions , and  investment articles . No construction or commissioning news for the Hermes reactor. Policy momentum is not the same as pouring concrete, and might actually work against you.  Commonwealth Fusion Systems  announced a  strategic partnership with Realta Fusion  on magnetic mirror technology. Interesting scientifically, irrelevant to construction progress.  There was also a lot of noise from a pastry company posing as a battery company, but I forgot the name or why it should matter. Sorry.   Key Takeaways - Stegra installing all 740 MW of electrolysers is the most significant physical FOAK milestone this month — but the €2B+ funding gap means the project is in a race between construction progress and capital markets patience. - ATOME Villeta is a FOAK financing case study worth studying: multilateral debt, full offtake, manageable scale ($650M). Not every project needs to be a megaproject to matter. - AI data center demand is now the dominant commercial pull for long-duration storage and clean power FOAKs. Form Energy is the clearest beneficiary, but this trend will reshape project economics across the board. Overall FOAKs I monitor seem so far either insulated from the unfolding global crisis or even benefiting from it, like ATOME and ElevenEs. Next month: expecting Stegra financing resolution news (hopefully), potential Form Energy factory production updates, and we'll check in on whether Kairos Hermes has anything physical to show. See you in May!

There's a new idea I came upon on how to finance FOAK factories: break the facility into three separate "shells" — the envelope, the piping and MEP, and the secret sauce — and finance each according to its risk profile. The envelope and MEP can supposedly attract debt; only the secret sauce needs equity. The math is appealing: a $100M equity requirement collapses to $35M. I've read the argument carefully (see the link to the original article). The logic of asset unbundling is sound in theory. The claim that debt issuers should be comfortable with it is not. Here's the problem: regardless of how many shells you create, you still have only one sea to sail in — one income stream from which all debt must be repaid. If your secret sauce doesn't work, you don't have sales. No sales, no debt service. The shells are legally separate; the revenue is not. You could, of course, structure the first two shells so that lenders can recover value by selling the envelope and MEP to the industrial property market if the project fails. That might work, in the same way that leveraged real estate speculation sometimes works — until it doesn't. In a distressed sale of a half-built FOAK facility in an industrial zone, the "envelope" you paid for doesn't sell at book value. Any lender who's been through a clean tech write-down knows this. The article's author doesn't provide a single real-world example where the three-shell approach was successfully implemented. I think that's telling. This reads as a thought experiment — a useful one, but not a proven playbook. That said, the underlying logic of categorising FOAK assets by risk is worth taking seriously. Not because it will unlock debt financing for your FOAK, but because it forces you to ask which parts of your FOAK don't actually need to be built from scratch. Vianode's FOAK is the example I keep coming back to. Instead of building an envelope, they rented one. That single decision removed significant CAPEX from the equity requirement and compressed their timeline by more than a year — without any complex shell structuring or debt instrument. No lender needed convincing. No legal structure needed to be negotiated. The three-shell framework, cleaned of its debt-financing optimism, is essentially pointing at this: before you raise equity for your factory, ask what you actually need to own. The answer is usually less than you think. If you're working through your FOAK capital structure and trying to figure out which costs are truly unavoidable, that's exactly the kind of question I work through with founders. A call is a good place to start. https://trellis.net/article/the-wrong-way-to-finance-a-factory/

I spent Wednesday evening at a roundtable in Valencia on European battery sovereignty. The discussion was sharp, honest, and at times uncomfortable. I left with a clearer sense of both the problem and a path forward that doesn't require waiting for Brussels to fix the IAA, renegotiate the Korea FTA, or launch another battery alliance. This is my attempt to pull the threads together. The question that matters most European battery policy has been trapped in a cycle of ambitious targets, delayed gigafactories, and subsidy structures that benefit incumbents more than they build capability. Northvolt's difficulties, the collapse of Britishvolt and Italvolt — these are not accidents. They are symptoms of a structural misdiagnosis. The diagnosis has been: Europe lacks battery manufacturing scale. The prescription has been: build bigger factories faster. Both are wrong. The question worth asking instead is: what can industry actually do right now, without waiting for policy to move? I want to argue the answer lies not in more gigafactories, but in rethinking the manufacturing architecture entirely.   The real problem is where mistakes are made Battery cell production has three stages: mixing, electrode coating, and cell assembly. If you want to understand why European gigafactories struggle, you need to understand what happens in the middle step. The Fraunhofer Institute's 2024 ramp-up report is unusually candid about this. Electrode coating — where active material is applied to metal foil in precise, uniform layers — is where the overwhelming majority of manufacturing errors occur. Tiny variances in slurry viscosity, coating speed, or drying conditions cascade into batch-level defects. Entire production runs get scrapped. The process window is narrow, the feedback loops are slow, and the knowledge required to maintain yield is tacit — it lives in the hands and judgment of experienced engineers, not in equipment manuals. High scrap rates during ramp-up are the central economic challenge facing European cell manufacturers today. But the cause matters as much as the symptom. The scrap problem is not an equipment problem or a chemistry problem. It is an accumulated process knowledge problem. Europe has been making batteries at scale for less than a decade, compared to Korea and China's two-plus decades. That gap doesn't close by building more factories. It closes by deliberately accumulating the right knowledge in the right places.   Why copying the Asian model doesn't work Europe's response to date has been to replicate the Asian manufacturing model: large, vertically integrated gigafactories producing one or two standard cell formats at scale, targeting automotive OEMs as the primary customer. This creates a second structural problem on top of the first. These gigafactories are architecturally dependent on a single customer segment — automotive — in a market that is volatile, consolidating under price pressure, and increasingly served by Chinese and Korean manufacturers with structural cost advantages. When an OEM cuts its EV targets or delays a platform, a gigafactory doesn't just lose revenue. It loses the demand signal that justifies its entire existence. Meanwhile, a substantial and largely unserved market sits right beside them. Heavy machinery manufacturers. Maritime equipment producers. Bus manufacturers. Military and defence customers. Each of these customers has specific cell format requirements, volumes that rarely exceed a few hundred megawatt-hours per year, and no viable European supply option today. Gigafactories cannot serve them. The minimum viable order size, the format rigidity, and the scheduling logic of mass production all make these customers commercially invisible to the current model. Yet in aggregate, they represent a deep, resilient, policy-insulated demand base — exactly what a nascent European battery industry needs to survive automotive market volatility.   The Airbus model, applied correctly Europe has a proven template for competing against vertically integrated industrial giants: distributed manufacturing across national specialisations, bound together by shared standards, governance, and integration capability. Airbus didn't try to replicate Boeing. It built a structurally different architecture — and won. Applied to batteries, the logic is the same. There is no physical law requiring electrode manufacturing and cell assembly to happen under the same roof. That co-location reflects an Asian industrial tradition, not an engineering necessity. Separating them is not fragmentation. It is specialisation — and it unlocks a different competitive position entirely. The proposal I keep coming back to is this: decouple electrode manufacturing from cell assembly , and build each part of the chain according to its own logic. Cell assembly is more mechanical, more flexible, and more amenable to being located close to end customers. Small, distributed assembly units — designed around the specific format requirements of heavy industry, maritime, defence, and mobility customers — can serve the market that gigafactories ignore. Lower capital outlay. Shorter lead times. Commercially viable at volumes too small for a gigafactory to care about, but too large and too specific for customers to source reliably from Asia. Electrode manufacturing is the harder, more capital-intensive, more knowledge-dependent part of the chain. It should be treated differently — concentrated, specialised, and built around genuine process expertise rather than spread thin across every cell assembly site in Europe.   The Korean question The Korean battery ecosystem is not monolithic in its orientation toward Europe. Some players are actively looking for ways to embed themselves in the European market — to access subsidy structures, secure long-term demand, and hedge against concentration risk in Asia. That creates an opening that European policy, so far, has largely failed to exploit. My argument is that electrode production should initially be sourced from Korean manufacturers — not as a concession to dependency, but as a strategic entry point. Korean players have spent two decades accumulating the process knowledge Europe needs. Engaging them as electrode suppliers to European cell assembly operations creates a working relationship and a dependency that runs in both directions: they need European market access; European assemblers need their electrode expertise. Over time, this relationship should evolve into joint ventures — electrode foundries co-located in European industrial clusters, with Korean process knowledge and European market access combined by design. Regions like Valencia, with low energy costs, major port infrastructure, and proximity to Mediterranean industrial customers, are natural candidates. The critical structural requirement — the one that has been absent from EU battery policy so far — is explicit knowledge-transfer obligations built into the JV terms. Not proximity-based hope that skills will diffuse across the fence, but contractual commitments that European engineers are trained, embedded, and eventually capable of running the electrode process independently. This is how the knowledge gap closes. Not through policy mandates, but through commercial structures that make skill transfer in both parties' interest.   Making it bankable One of the persistent frustrations in European battery investment is the financing gap between what policy promises and what the capital markets will actually fund. The problem is structural: gigafactory-scale projects require enormous capital commitments against demand projections that are inherently uncertain years into the future. Automotive offtake is volatile. Technology risk is real. The numbers rarely close comfortably. The hub-and-spoke model, structured correctly, changes this calculus. Small cell assembly units serving identified customers with specific format requirements and signed offtake commitments are fundable at a scale that doesn't require betting hundreds of millions on automotive demand forecasts five years out. The electrode supply from an established Korean partner de-risks the technology question — investors are not being asked to fund a process that has never been demonstrated at scale. The JV structure creates a credible path to local knowledge accumulation, which de-risks the long-term sovereignty question. What remains is to structure the demand commitments from heavy industry, maritime, and defence customers who cannot currently access European cell supply and have strong incentives to do so. Those customers exist. The Korean partners willing to engage on the right terms exist. The cluster infrastructure exists in several European locations. The missing element is a willingness to build the first spoke — to demonstrate that the assembly model works commercially, and to create the foundation on which the first electrode JV can be justified.   What can we do without waiting for policy? The hub-and-spoke model does not require the IAA to be redesigned, the EU-Korea FTA to be renegotiated, or a new European Battery Alliance working group to convene. It requires a small number of European cell assemblers willing to build for underserved customers, a Korean electrode partner with reasons to engage, a cluster with the right cost and logistics profile, and customers ready to commit to offtake. None of that is a policy ask. All of it is a commercial decision. Europe has a habit of waiting for the right policy environment before moving on industrial strategy. The Asian battery industry didn't wait. It built, iterated, accumulated knowledge, and created the structural advantages that European policy is now trying to legislate away. That approach won't work. The alternative is to build something structurally different — not a slower, more expensive version of what Korea and China already have, but an architecture that fits European strengths: distributed collaboration, specialised supply chains, and a deep pool of underserved industrial customers who need a supply partner they can trust. That architecture is available. The question is whether European industry will build it before the window closes.   I work with European battery founders and industrial companies on supply chain structure decisions — particularly how to approach the electrode manufacturing challenge without the full CAPEX burden of vertical integration. If the model described here is relevant to a decision you're facing, I'm happy to think it through.

Can demand-pull industrial policy actually build a battery industry? I've seen this movie before — not in Brussels, but in Russia. Around 2015, the Russian government wanted a domestic wind industry. Their solution was elegant: offer a feed-in tariff roughly double the prevailing energy price, but only if your wind farm hit 60% local content. Later raised to 80%. Within a few years, there were turbine blade factories, nacelle assembly lines, and local supply chains that hadn't existed before. The policy worked because the carrot was big enough to change behaviour. The IAA — the EU's proposed International Procurement Instrument for EVs and batteries — is attempting the same logic. Tie public EV subsidies and procurement to local content, and manufacturers will localise to access the demand. On paper, the numbers are compelling. Germany alone has allocated €3 billion to its new subsidy scheme, covering an estimated 800,000 vehicles through 2029. France runs a parallel €1 billion programme. Italy is offering up to €11,000 per vehicle. Add public procurement — electric buses, municipal fleets, government vehicles — and the total addressable market for "IAA-compliant" EVs is enormous. The carrot exists. So why am I not convinced it will build a battery industry? The Russian wind analogy breaks down in one critical place: who is being incentivised to transfer technology, and whether they have any reason to do so. In Russia, the technology holders were Western OEMs — Siemens Gamesa, Vestas — who wanted market access badly enough to actually train local engineers, license manufacturing processes, and set up genuine local production. They transferred skills because the alternative was exclusion from a large market. In the IAA case, the technology holders — Korean cell makers like LG Energy Solution and Samsung SDI — are largely exempt . The EU-Korea Free Trade Agreement means Korean suppliers can access European subsidies without needing to meet the same local content rules as Chinese competitors. They have every incentive to maintain European sales while keeping actual manufacturing and process knowledge at home. The IAA, as currently structured, does not force a technology transfer moment with the companies that actually know how to make cells. What about the Chinese makers? CATL and BYD will lose access to the subsidised slice of the market. That's real — but I'd argue it's not the segment they were planning to win anyway. Public procurement was never going to go to CATL; that was always politically impossible. And on the private consumer side, the question is whether Chinese-made EVs can compete on price without subsidies. Given that BYD's European revenue grew 216% year-on-year in 2024–25 largely through direct consumer sales, the answer appears to be: yes, they can price-match without the subsidy. CATL is also hedging aggressively. Their €7.6 billion Debrecen plant is designed precisely to qualify as "Made in EU" for the purposes of the IAA. If they succeed — and the race to hit 70% EU content is genuinely uncertain — they keep their market position and the IAA has simply induced them to build a factory in Hungary, not to transfer knowledge to European startups. The deeper problem: skills don't transfer by proximity. The Russian wind example worked because the local content requirements came with mandatory joint ventures and technology licensing . The carrot forced collaboration that built actual competence. The IAA creates market access conditions, but not knowledge transfer conditions. An LG Energy Solution plant in Poland, producing cells with Korean engineers and Korean process knowledge, may satisfy EU content rules — while a European battery startup trying to scale its first gigawatt-hour is still struggling to find experienced cell engineers who've seen a production ramp before. The EU battery ecosystem's real deficit is not capacity. It's the accumulated process knowledge of how to make cells reliably at scale — yield rates, formation protocols, electrode coating know-how. That knowledge lives in Korea and China. The IAA, as designed, does not create a mechanism to bring it to Europe. The question I'd ask policy makers:  What's the mandatory skills transfer clause? Without it, the IAA may create a very expensive set of Korean and Chinese gigafactories on EU soil, staffed with imported expertise, that satisfy the letter of local content rules while leaving European battery startups exactly where they are today: technically capable, commercially under-capitalised, and without a manufacturing path that doesn't run through an Asian partner they can't fully control. The carrot is real. The logic is sound. But demand-pull without skills-pull is half a policy. If you're a European battery startup navigating what the IAA means for your supply chain and commercialisation strategy, this is exactly the kind of decision I help founders think through. Book a call.