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Cylib wants to own electric car battery recycling business in Europe

A slew of battery recycling startups have emerged in Europe, trying to tap into the next big opportunity in the electric vehicle market: battery waste.

One of them is Cylib, a Germany-based startup with a product that could be economically attractive to automakers. The company says it can extract all the materials in a battery in pure form, using a fraction of the energy used by its competitors.

This means Cylib is able to recover all elements – including lithium, cobalt, nickel, aluminium and manganese – from electric vehicle and micromobility batteries as well as production waste, using 30% less energy than its competitors.

Lilian Schwich, Cylib CEO and co-founder, believes this secret will give the startup an edge over rivals with greater resources and longer value chains, such as Swedish incumbent Northvolt and U.S. heavyweight Redwood Materials. Massachusetts-based Ascend Elements also recently entered the European market, forming a joint venture with Polish startup Elemental.

That was enough to attract Lilian Schwich, a backer from the climate, deep tech and corporate automotive sectors, who founded the startup in 2022 after spending more than a decade at RWTH Aachen University researching resource-efficient battery recycling methods.

Earlier this month, Cylib completed a €55 million Series A round led by World Fund and Porsche Ventures (the venture capital arm of sports car maker Porsche). Bosch Venture Capital, DeepTech & Climate Fonds, NRW.Venture and others also participated in the round.

Cylib will use the funds to build a new industrial-scale plant in Aachen, expected to be operational in 2026, and add more employees to its team of 60. In the long term, Cylib hopes to expand its business beyond Germany to other European markets.

“We raised €7.6 million in a seed round and used that money to build a pilot facility that can recycle one electric vehicle battery pack per day, which is about 300 to 600 kilograms,” Gideon Schwich, co-founder and COO of Cylib and husband of Lilian Schwich, told TechCrunch. “A Tesla is about 300 kilograms, a Porsche is about 600 kilograms.”

Today’s production capacity, tomorrow’s cathode

Cylib has established partnerships with automotive OEMs, Tier 1 suppliers and lithium refineries to ensure battery production scrap is available for near-term recycling. These partnerships are critical to Cylib’s long-term success and continued feedstock supply, ensuring access to end-of-life electric vehicle batteries for future recycling.

Today, it’s also important for Cylib to secure feedstock, such as batteries and production scrap that can be processed in recycling facilities, so it can prove to manufacturers that it has the capability to handle recycling on an industrial scale.

“The problem with battery recycling is that if you don’t have the capacity, the big companies won’t give you the feedstock,” Anil Achuyta, managing director of TDK Ventures, the venture capital arm of Japanese electronics giant TDK Corporation, told TechCrunch. “If you don’t have the feedstock, you don’t have the capacity.”

Achuyta said TDK Ventures, which invested in Cylib competitor Ascend Elements, helped the startup prove its worth in 2021 by “moving aggressively in the market” and investing heavily in building capacity and purchasing feedstock. Today, Ascend’s U.S. plant can process 26,000 tons per year.

In addition to raw materials and production capacity, Archueita said that as an investor, what he really wants to see is the battery recycling company’s future plans to produce cathode active materials, because that’s where the real money is. The cathode is the part of the lithium-ion battery that is used to store energy and release energy when the battery is used. It is usually made of metal oxides, such as lithium cobalt oxide or lithium manganese oxide. In other words, battery recycling startups should go beyond recycling batteries and refining materials to remanufacturing cathode materials.

Currently, most battery recycling companies export battery materials to China and other parts of Asia for development into active cathode materials, which are then shipped back to domestic automakers and battery manufacturers. This goes against the principles of a circular economy.

Schweich said Cylib does have plans to produce cathode active materials in the future, but large-scale production is not a priority until the new plant is operational.

“What we do best is producing really green and pure raw materials into technical or battery-grade materials, which brings the greatest added value to the market,” Schwich says. “But this does not mean that these materials can be used directly to make new batteries. They have to go through several steps, and this is what we are developing now with our partners.”

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