Valor Atomics, a startup that makes small modular nuclear reactors (SMRs) — essentially small, factory-built power plants designed to be cheaper and faster to install than traditional nuclear reactors — is in talks to raise new financing, three people familiar with the company said. The three-year-old company is seeking a valuation of about $6 billion, and Sequoia is expected to lead the transaction, the people said.
The Information first reported the funding talks, including that the El Segundo, Calif., startup is raising $1 billion in an equity round.
Some of that capital was raised at a lower valuation than previously, people told TechCrunch. Specifically, Valar raised $450 million, including $340 million in equity and $110 million in debt, at a valuation of $2 billion, according to a March report from Bloomberg.
In today's AI-powered financing environment, transactions consisting of multiple installments at different valuations, sometimes executed at different times, are becoming increasingly common. These transactions can create the perception that capital is invested at a single, uniform valuation. In reality, investors in the same round may end up paying different prices for the same company. This distinction is more important than ever as outsiders try to compare hot startups to each other.
Sequoia and Valar Atomics declined to comment.
The company revealed earlier this month that the reactor is providing a small amount of power to Nvidia's AI chips. Concurrent with that proof-of-concept demonstration, Valar and Nvidia announced a partnership to explore the development of nuclear energy to power future AI data centers.
Valar's rise is countering a broader demand contraction. Data center power demand is expected to increase rapidly in the coming years, and it will be several years before many local power companies can add enough new capacity. That vacuum has turned nuclear power, long plagued by cost overruns and regulatory bottlenecks, into the hottest part of the AI ​​infrastructure boom.
Valar counts Anduril founder Palmer Luckey and Palantir chief technology officer Shyam Sankar among its backers. Other companies eyeing this opportunity include Kairos Power and TerraPower (backed by Bill Gates), which are building next-generation nuclear reactors aimed at high-tech and industrial customers, and NewScale Power, the only SMR developer with U.S. regulatory design approval. (Last year, it won approval for an improved high-power reactor design.)
Valar's technology is based on a helium-cooled high-temperature gas reactor. The company says it plans to eventually build hundreds of SMRs to power data centers. But while SMRs are theoretically cheaper to manufacture than traditional nuclear reactors, the technology is still in its infancy, and it's not entirely clear how long it will take to deploy it on an industrial scale.
In this context, Valar has taken an aggressive legal stance towards regulators. Last year, the company joined several states and rival startups in suing the Nuclear Regulatory Commission, alleging that it unfairly applies the same lengthy licensing process to small test reactors that it uses for full-size commercial plants. (The case is not unresolved, and both sides have repeatedly paused litigation, suggesting some kind of settlement is in the works.)
The company was founded by Isaiah Taylor, who dropped out of high school at the age of 16. Now 27, he says he founded two startups before Valor and proudly shares that his great-grandfather worked as a nuclear physicist on the Manhattan Project.
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