After you’ve worked on rockets that find their way to outer space, it can be hard to come up with a second act. For SpaceX alumni Andrew Redd, it meant looking deep in the ocean.

Redd, who grew up in the Pacific Northwest, a region affected by uncharacteristic heat waves and catastrophic fires in recent years, knew he wanted to tackle something in renewable energy.

“But the experience at a very hardcore company like SpaceX made me realize that I can’t just come up with an incremental solution. It actually has to be brand new and it has to be approached from first principles,” according to Redd, who was an engineer on Dragon and Starship at SpaceX.

Redd left SpaceX and founded Endurance Energy, a startup that has raised a $54 million Series A to eventually harness terawatts of geothermal energy deep in the ocean, TechCrunch has learned. Founders Fund led the round, with participation from Ascend, Construct Capital, Felicis Ventures, First Round Capital, Point72 Ventures, Riot Ventures, and Voyager Ventures. The new funding will allow the company to develop its plans for power plants at a time of surging energy demand from AI data centers, electric vehicles, and heavy industry.

Since founding the company last year, Redd has grown the team to 25 employees, 12 of whom used to work at SpaceX. The company’s vice president of engineering previously worked at Helion Energy, the fusion startup.

Geothermal energy isn’t a new idea — humans have been using the Earth’s heat for millennia, whether it be from spa-like hot springs or geothermal power plants. But Redd, drawing on his experience at SpaceX, figured there was another opportunity people were overlooking. 

Here’s how he distilled the problem: Any future energy source should be renewable, or at least non-polluting, in his opinion. “That’s my non-negotiable,” said Redd, who is CEO of Endurance. It should also be available 24/7 — or baseload power, as the industry calls it — and it should be quickly deployable and able to generate tens or hundreds of gigawatts of electricity, according to Redd. 

He quickly ruled out nuclear power because regulatory and construction timelines can stretch on for years. Solar and wind aren’t available 24/7 without batteries, and hydropower is limited in where it can be built (plus all the good spots have been taken). That left geothermal.

“Geothermal is the only real deployable, baseload renewable,” he said. “But why is it only 0.4% of U.S. energy?”

There are other startups pursuing geothermal, including Fervo and Zanskar. But those companies need to drill thousands of feet into the Earth’s crust to access temperatures hot enough to drive a power plant. So far, the best opportunities for many geothermal startups has been in the Western U.S., far from large population centers.

The best places to drill, where the crust is thin and magma flows close to the surface, like in Iceland or California, have long been claimed. More recently, startups like Fervo Energy, XGS Energy, and Sage Geosystems have found other sites, but to find rocks that are hot enough to drive a power plant, they need to drill thousands of feed deeper. Those locations have so far been away from large population centers.

But no one has tapped the oceans. 

At several points around the globe, the Earth’s tectonic plates are spreading apart, allowing hot magma to flow to the surface. The U.S. West Coast, Japan, and a good chunk of Southeast Asia are near the so-called Ring of Fire, the geologically active zone that encircles the Pacific Ocean.

Heading out to sea poses several challenges. Operating underwater, at the depths Endurance is proposing, isn’t easy. Robots will need to do much of the work. Saltwater is famously corrosive, so anything placed down there will have to be hardened against both water pressure and corrosion. 

But Redd said those are surmountable hurdles, pointing to the oil and gas industry’s decades of experience drilling in the ocean. Endurance’s work should pose less risk to the surrounding ocean, he points out. “If we have a blowout — quote unquote — you’re leaking hot water into the ocean, which is already leaking out in terawatts all over the Earth,” Redd said.

Some of the geothermal resources Endurance is eyeing are a few dozen miles from shore, while others are a few hundred. Which get developed will be the product of an optimization algorithm that balances the cost of the submarine cable with the scale of the resource and the size of the market on shore. (Redd says the company plans to avoid sensitive habitats like those near hydrothermal vents.)

If Endurance taps just a fraction of the geothermal potential out there, it could generate a significant amount of electricity. Redd estimates there’s about 6 terawatts that could be developed in the next five to 10 years around the Ring of Fire. To put that in perspective, the world uses an average of about 20 terawatts across all energy sources at any given moment. 

“The idea is that you could support any major coastal city on the Ring of Fire,” Redd said.

Bank of England Governor Andrew Bailey warned on Friday that artificial intelligence may need to be rationed because the power supply cannot keep up with its capabilities. He said companies and governments face “very big social choices” as energy constraints force trade-offs between sectors. The question is not whether AI can do more, but whether there is enough electricity to let it.

“AI is probably going to fairly soon be at a point where it can do more things, more big things than we have the power supply to achieve,” Bailey said at an event in Kirkcaldy, Scotland, with Bloomberg’s Stephanie Flanders and former Cabinet minister Ed Balls.

He framed the dilemma as a choice between competing priorities. “Do we want to make more very big breakthroughs in health?” he asked. Or “do we want to make more breakthroughs in drone technology to fight the Russians in Ukraine?” Bailey said the issue of potential trade-offs was recently raised with him by the head of a large AI firm, whom he did not name.

The concern is not theoretical. The EU recently asked households to cut electricity use during peak hours because AI data centres are straining the grid. US utilities plan to spend $1.4 trillion on infrastructure by 2030 to cope with the data centre boom. Every megawatt allocated to AI is a megawatt unavailable for housing or manufacturing.

Bailey has previously argued that the UK economy is stuck between waves of technological innovation. The last wave was the internet. He sees AI as the most likely candidate to be the next general-purpose technology, but has cautioned that productivity benefits will take time to materialise.

On employment, Bailey was less alarmed. He said AI will both create and destroy jobs, pointing to roles like data scientists as examples of new positions that will emerge. “There will be jobs that don’t exist anymore,” he added, but signalled he is not concerned about a surge in mass unemployment.

That tracks with broader warnings that the UK’s AI ambitions may collide with its climate commitments. Bailey’s comments suggest the collision extends beyond carbon: the fundamental constraint may be physical infrastructure that simply cannot be built fast enough.

TL;DR

Germany-based Focused Energy raised an oversubscribed $240M Series A led by utility RWE to commercialise laser-powered inertial confinement fusion based on the NIF’s historic net energy gain experiment. The company plans a demonstration reactor at a decommissioned German fission plant.

Focused Energy, a Germany-based fusion startup, has raised an oversubscribed $240 million Series A round to develop a commercial reactor based on the same approach that produced the world’s first controlled fusion reaction with net energy gain. The round, led by German utility RWE, brings the company’s total private capital to $300 million. Focused Energy has also received $200 million in grants, making it one of the most heavily funded fusion startups in the world at approximately $500 million in total funding.

The round also included participation from SPRIND, the German Federal Agency for Breakthrough Innovation, Prime Movers Lab, and the European Innovation Council Fund. Focused Energy plans to build its first demonstration system, called Lighthouse, at the site of a decommissioned nuclear fission power plant in Germany operated by RWE, a practical decision that leverages existing grid connections, cooling infrastructure, and regulatory frameworks designed for nuclear facilities.

From NIF experiment to commercial reactor

Focused Energy’s approach is inertial confinement fusion, in which lasers compress a fuel target to create conditions extreme enough for atoms to fuse and release energy. The technique was validated in December 2022 at the National Ignition Facility at Lawrence Livermore National Laboratory in California, a breakthrough that arrived as global energy demand from AI data centres was beginning to surge. That experiment remains the first and only controlled fusion reaction to release more energy than was required to ignite it.

The NIF connection is not just conceptual. Debbie Callahan, who helped design the fuel target used in the historic NIF experiment, joined Focused Energy in December as chief strategy officer. Her task is to simplify the target for commercial production. The NIF’s fuel target is complex and difficult to manufacture, and the facility fires approximately 400 shots per year. A commercial reactor will need to fire 10 shots per second, or roughly 864,000 per day.

One critical simplification is eliminating the hohlraum, a precision-manufactured gold cylinder that the NIF uses to convert laser energy into X-rays, which then compress the fuel pellet. Focused Energy’s “direct drive” system skips this intermediate step, with lasers compressing the fuel pellet directly. This should improve the reactor’s energy efficiency and simplify the fuel target manufacturing process, both of which are essential for a system that needs to operate continuously at industrial scale.

A crowded field with real money

Focused Energy is entering an increasingly competitive fusion landscape. European deep tech startups are attracting significant government and private investment, and fusion is among the most capital-intensive categories. Inertia Enterprises raised a $450 million Series A in February for its own inertial confinement reactor, making it a direct competitor. Thea Energy raised $100 million last week for a pixel-inspired fusion approach. Type One Energy, backed by Bill Gates, raised nearly $90 million toward a $250 million Series B in January. Commonwealth Fusion Systems, which is in Gigascale Capital’s portfolio, raised $863 million for its magnetic confinement approach.

The investment wave reflects a convergence of factors: the NIF’s proof that net energy gain is physically possible, AI-driven electricity demand that is straining existing grids, and government programmes in the US, EU, and UK that are providing grants and regulatory frameworks for fusion development. Energy storage and generation technologies that can provide baseload power without carbon emissions are attracting capital that would have been unimaginable five years ago.

The engineering gap

The distance between the NIF experiment and a commercial power plant is enormous. The NIF achieved net energy gain measured against the energy delivered to the fuel, not against the total energy consumed by the laser system, which is orders of magnitude larger. A commercial reactor must achieve gain measured against total system input, which requires both more efficient lasers and higher-yield fuel targets.

Focused Energy’s direct-drive approach addresses part of this gap by removing the hohlraum’s energy losses, but the company still needs to demonstrate that its laser system can achieve the precision, repetition rate, and efficiency required for continuous operation. The urgency of the energy problem is real, with AI infrastructure alone expected to consume 9% of US electricity by 2030, but urgency does not change the physics.

RWE’s involvement as lead investor is the most commercially meaningful signal in the round. A major European utility putting capital into a fusion startup and offering a decommissioned plant site for the demonstration system suggests that at least one entity with deep experience operating power plants believes Focused Energy’s approach has a credible path to grid-connected electricity. Whether Lighthouse can bridge the gap between laboratory physics and commercial power generation is the $500 million question.

Focused Energy recently raised an oversubscribed $240 million Series A round, one of the largest early-stage rounds for a fusion power startup. 

The new round, announced last week, brings the company’s total private capital raised to $300 million, the company told TechCrunch. The startup has also received $200 million in grants, collectively making it one of the most heavily funded fusion startups.

Germany-based Focused Energy is developing a reactor that will use lasers to compress fusion fuel, an approach known as inertial confinement. The lasers fire on a fuel target, which compresses under the onslaught to create conditions ripe for fusion. When atoms inside the fuel finally fuse, they release significant amounts of energy.

The company is basing its design on the experiment at the National Ignition Facility at the Lawrence Livermore National Laboratory in California. That experiment is so far the first and only one to create a controlled nuclear fusion reaction that released more energy than it took to ignite it. The NIF connection is more than conceptual — Debbie Callahan, who helped design the fuel target at the NIF, joined Focused Energy in December as its chief strategy officer. 

At Focused Energy, Callahan is working to simplify the fuel target. The NIF’s target is complex and hard to manufacture, and the facility only fires about 400 shots per year. Focused Energy, on the other hand, will need to do 10 shots per second, or about 864,000 shots per day. 

One simplification involves doing away with the hohlraum, a precision-manufactured gold cylinder that converts laser energy into X-rays. The X-rays do the work of compressing the fuel pellet at the NIF. Focused Energy’s laser system is what industry insiders call “direct drive” — that is, the lasers directly compress the fuel pellet. That should help boost the reactor’s efficiency, making it easier to produce power. 

Focused Energy is hoping to build its first demonstration system, Lighthouse, at the site of a decommissioned nuclear fission power plant in Germany that was operated by the utility RWE. 

RWE was the main investor in the Series A, Focused Energy told TechCrunch. The round also included participation from the German Federal Agency for Breakthrough Innovation (SPRIND), Prime Movers Lab, and the European Innovation Council Fund.

As large as this Series A is, the fusion industry has been an investor favorite this year. Last week, Thea Energy raised $100 million to develop its pixel-inspired fusion reactor. In February, Inertia Enterprises raised a $450 million Series A to develop its own reactor, which could be a close competitor to Focused Energy’s. And in January, Type One Energy told TechCrunch that it had raised almost $90 million toward a $250 million Series B.

TL;DR

Former Meta CTO Mike Schroepfer’s Gigascale Capital raised a $250 million fund focused on energy, grid infrastructure, and critical minerals startups. The fund bets that AI’s energy demands will make clean power startups the real winners of the AI boom.

Gigascale Capital, the venture firm led by former Meta chief technology officer Mike Schroepfer, has raised a $250 million fund to invest in energy, grid infrastructure, and critical minerals startups. The fund, announced on Monday, is Gigascale’s second and its first to include institutional investors. It arrives as most of the venture capital industry has pivoted away from climate tech and toward AI, making Schroepfer’s continued bet on the physical economy a deliberate contrarian move.

“The companies we back win because they’re cheaper, faster, and more reliable,” Schroepfer said. “Climate impact is the result of better-performing systems.” The framing is notable: Gigascale is positioning clean technology not as a values-driven investment thesis but as an economic inevitability driven by performance advantages.

AI is the catalyst, not the competitor

The irony of a former tech executive raising a climate fund during an AI boom is less contradictory than it appears. US utilities plan to spend $1.4 trillion by 2030 to meet the electricity demands of AI data centres, which could consume 9% of the country’s total electricity by the end of the decade, up from 4% in 2023. Natural gas turbines, the default backup power source, have waitlists stretching into the early 2030s.

That power crunch creates the opening Gigascale is targeting. Companies that need massive amounts of electricity, whether for AI training, manufacturing, or industrial processes, cannot wait for utility-scale infrastructure to catch up. Startups building solutions to the data centre energy problem are already attracting significant capital, and Schroepfer has argued on podcasts that “bring-your-own power is going to be a competitive advantage over time” for energy-intensive businesses.

Gigascale’s existing portfolio reflects this thesis. Commonwealth Fusion Systems, which raised $863 million from investors including Nvidia, Google, and Bill Gates, is developing commercial fusion reactors. Form Energy builds 100-hour iron-air batteries designed for grid-scale storage. Heron Power raised $140 million for grid infrastructure technology. These are not consumer apps. They are companies building the physical infrastructure that the digital economy requires.

Bucking the climate tech backlash

The $250 million raise is significant because it comes at a moment when much of the venture industry has abandoned the “climate tech” label. After a wave of high-profile climate-focused funds launched between 2020 and 2023, returns have been mixed and several prominent climate startups have struggled. European venture firms are raising large funds with broader mandates, and US investors have largely redirected capital toward AI-native companies.

Schroepfer started Gigascale after studying climate technology during the pandemic. His argument is that the sector’s problems are not technological but commercial: clean technologies need to be cheaper and faster than incumbents, not just greener. Solar energy is his reference case, a technology that won market share not because of environmental mandates but because it became the cheapest source of electricity in most of the world.

The fund will also look at critical minerals and what Schroepfer calls “physical AI,” a term that likely refers to robotics and automation applied to manufacturing, mining, and construction. Battery storage and mineral supply chains are increasingly recognised as bottlenecks in the energy transition, and startups that can address those constraints have a clearer path to revenue than companies building yet another solar panel.

The Meta connection

Schroepfer served as Meta’s CTO for more than a decade before stepping down in 2022. His tenure included oversight of the company’s infrastructure buildout, including the data centres that now consume massive amounts of electricity to run AI workloads. The experience gave him direct exposure to the energy constraints that large-scale computing faces, an understanding that informs Gigascale’s investment thesis.

Meta itself has become one of the largest corporate buyers of clean energy, with 2026 capital expenditure guidance between $125 billion and $145 billion, much of it directed toward AI infrastructure. The search for solutions to AI’s energy problem has produced ideas ranging from data centres in space to small modular nuclear reactors, but the most commercially viable answers are likely to come from startups building practical improvements to energy generation, storage, and distribution.

Gigascale’s $250 million is modest relative to the scale of the energy infrastructure challenge, but the fund’s contrarian positioning could prove well-timed. If the AI industry’s power consumption continues to accelerate and legacy energy infrastructure cannot keep up, the startups building the physical layer will capture value that no amount of software optimisation can replace.