Hertha Metals Secures $133.65M Series A to Produce High-Purity Iron for Domestic Rare-Earth Magnets

Series A and federal co-funding will finance Hertha Chalyx, a new plant producing high-purity iron and steel to address the U.S. shortfall for rare-earth magnet manufacturers

CONROE, Texas--(BUSINESS WIRE)--Hertha Metals, the steel company behind the world’s first single-step steel and high-purity iron process for lower-cost domestic production, today announced the close of a $133.65M Series A round, including a $65M equity investment from the U.S. Government, executed through its Industrial Base Analysis and Sustainment (IBAS) program in partnership with the Economic Defense Unit. The round was co-led by Khosla Ventures and Doerr Capital, with participation from CEV, Pear Ventures, Gates Frontier, Niterra SUISO no MORI Fund (General Partner: Global Brain), Toyota Ventures and Siemens Financial Services. IBAS is a federal program that funds projects to strengthen and modernize the defense industrial base.

The funding will finance the construction of Hertha Chalyx, the company’s new facility that plans to produce 10,000 tonnes of steel-grade and magnet-grade high-purity iron. Chalyx, alongside Hertha’s pilot plant, Pi100, will be the first modern iron and steel innovation complex, a significant step toward reshoring iron and steel production central to IBAS’s industrial base mission.

The United States currently imports almost all of the high-purity iron used in rare-earth permanent magnets. NdFeB magnets are made of roughly 70% high-purity iron by weight, yet the U.S. has no domestic production capacity for this essential material. As the U.S.-made magnet push grows with the Defense Federal Acquisition Regulation Supplement (DFARS), Hertha Chalyx is establishing domestic production of the high-purity iron that rare-earth magnets need, creating a supply chain that spans mining to manufacturing entirely on American soil.

Hertha's Flex-HERS^TM process replaces the multi-step, coal-dependent blast furnace method with a single continuous reactor that processes any grade of iron ore and uses natural gas or hydrogen as a reductant. The result is iron and steel at 25% lower production costs than conventional blast furnaces, with emissions reductions of 50% using natural gas and up to 98% using hydrogen.

"Every electric vehicle, aerospace platform, radar system, and data center depends on domestic iron and magnet feedstock suppliers," said Dr. Laureen Meroueh, CEO and Founder of Hertha Metals. "Hertha Chalyx closes that gap. We are building the supply chain this country needs, and we are doing it by providing a domestic cost-competitive option for manufacturers while unlocking safer and cleaner production."

“Hertha has cracked what the steel industry has chased for many decades: iron and steel in one step, below blast-furnace cost, and made in America. That's the missing link for every magnet, EV, data center, and defense platform this country builds," said Rajesh Swaminathan, Partner at Khosla Ventures. "We led their seed round to back this vision and have doubled down at every round since, due to their consistent execution and our strong conviction in the team."

“The industrial technologies that win are the ones that are cheaper, cleaner, and better performing,” said Ryan Panchadsaram, Partner at Doerr. “Hertha's technology has the potential to produce critical materials at lower cost and with far lower emissions, while deepening essential domestic manufacturing capacity. That’s the kind of innovation that can scale and make a real difference.”

Hertha currently operates a 360-ton-per-year demonstration facility in Conroe, Texas, and is in the active supplier qualification process with major U.S. rare-earth magnet producers. When Hertha Chalyx breaks ground this year, these integrated facilities producing both steel and high-purity iron on a single site will give U.S. magnet and defense manufacturers a source they lack, making Hertha Metals as much a national security asset as an industrial one.

About Hertha Metals

Hertha Metals is producing steel at lower cost, with ore-grade flexibility, and with significantly reduced emissions than conventional methods, using fully domestic iron ore and natural gas. Hertha is reshoring iron and steel production, enabling more jobs, and providing manufacturers with access to cost-competitive, high-quality steel and iron while meeting sustainability goals. The company partners with steel producers and supplies critical high-purity iron to rare-earth magnet manufacturers, helping secure domestic supply chains and advance American manufacturing competitiveness. For more information, visit herthametals.com.