tozero, a Munich-based pioneer in sustainable lithium-ion battery recycling, has successfully raised €11 million in an oversubscribed seed funding round. The investment, led by NordicNinja, includes new backers such as In-Q-Tel (IQT), automotive giant Honda, and global engineering firm JGC Group, alongside increased support from existing investors. This funding will enable tozero to build its first industrial-scale recycling plant and ramp up the production of recycled lithium, a critical material for the rapidly expanding electric vehicle (EV) and renewable energy sectors.

A Key Player in Europe's Lithium Recycling Market

Founded in 2022 by Sarah Fleischer and Dr. Ksenija Milicevic Neumann, tozero stands out as the first European company to successfully supply recycled lithium for end products. The company’s proprietary technology addresses a critical bottleneck in the recycling process, focusing on recovering valuable raw materials from lithium-ion battery waste. As the demand for lithium continues to surge, tozero’s ability to reintegrate recycled materials back into global supply chains offers a much-needed solution to Europe’s lithium supply gap.

The fresh capital will be used to establish tozero’s first industrial deployment plant, often referred to as a First-Of-A-Kind (FOAK) facility. This will significantly scale up its capacity to produce recycled lithium. The company’s pilot plant, operational since April, recently completed its first commercial delivery and will serve as the foundation for larger-scale operations.

Addressing the Global Lithium Shortage

The global demand for lithium is projected to quadruple by 2030, driven by the growth of electric vehicles and large-scale renewable energy storage systems. Lithium also plays a vital role in a range of industries, including ceramics, lubricants, and high-performance glass. However, the total lithium production from mining last year reached only 180,000 metric tons—just 5% of the estimated demand for the coming decade. Additionally, the majority of lithium production is concentrated in China, which supplies 97% of Europe’s lithium imports. This heavy dependence on foreign sources has prompted the European Union to prioritize lithium recycling as part of its efforts to curb reliance on mining.

In response to these challenges, the EU has implemented its Battery Directive, aiming for at least 80% of lithium to be recovered from batteries by 2031. However, large-scale industrial lithium recycling has yet to be successfully demonstrated. This is where tozero is making a significant impact. The company’s technology not only recovers lithium but also reduces emissions by an estimated 70% compared to traditional lithium mining, making it an environmentally sustainable solution.

Revolutionizing the Lithium Recycling Process

tozero’s recycling process is a breakthrough in the industry. Unlike traditional high-temperature smelting methods, which often result in the loss of valuable materials like lithium and graphite while producing significant emissions, tozero’s method preserves these critical elements. This innovative approach has allowed tozero to achieve high-purity recycled lithium, which can be sold directly to industries for manufacturing end products.

The company’s feedstock-agnostic approach enables it to recycle a variety of battery types, ensuring its ability to meet diverse market needs. By offering a low-cost, asset-light solution, tozero is well-positioned to integrate into both local and global supply chains. The company already works with battery waste suppliers across more than 10 countries, creating a local, circular source of lithium that helps reduce Europe’s reliance on imports.

Scaling Operations and Preparing for the Future

The latest round of funding brings tozero’s total capital raised to €17 million, including a €2.5 million grant from the European Innovation Council (EIC). This financial boost will help the company scale its technology and commercial operations. With the new funding, tozero is on track to process 30,000 tonnes of battery waste annually by 2026, setting a new benchmark for sustainable battery recycling in Europe.

In addition to the financial backing, tozero has garnered attention from high-profile investors, including automotive sector leaders like Martin Hofmann, former CTO of Volta Trucks, and Axel Strotbek, former board member of Audi. These investors are instrumental in supporting the company's mission to establish itself as a leader in the recycling of lithium-ion batteries.

The Road Ahead for tozero

Sarah Fleischer, co-founder and CEO of tozero, expressed her excitement about the company’s achievements so far and the path ahead. “Despite being a young startup, we’ve already made history as the first to deliver recycled lithium for end products in Europe,” she said. “Our journey is just beginning, and we’re poised to tackle the global lithium crisis and contribute to a more sustainable energy future.”

Shin Nikkuni, co-founder and managing partner at NordicNinja, highlighted tozero’s potential to transform Europe’s battery recycling landscape. “tozero’s innovative approach to battery recycling is exactly what Europe needs to secure key supplies in the global electrification race,” Nikkuni said. “We are excited to support Sarah and Ksenija as they scale their technology and operations, contributing to a more sustainable and independent energy future.”

As Europe’s first company to deliver recycled lithium, tozero is poised to play a vital role in addressing the region’s critical materials crisis. The new funding will allow the company to expand its operations, bringing its sustainable lithium recycling technology to industrial scale. With growing global demand for lithium, tozero’s innovative approach offers a solution to Europe’s supply challenges while promoting environmental sustainability. As the company continues to scale, it is well-positioned to lead the charge in the circular economy for battery materials, helping to drive the green energy transition forward.