Battery recycling startup Redwood Materials has expanded its Series E funding round to $425 million with Google joining as a new strategic investor. The investment is aimed at accelerating Redwood's new energy storage business, which repurposes used electric vehicle batteries to create large-scale power systems for energy-hungry AI data centers.
The move underscores a strategic pivot for Redwood, founded by former Tesla CTO JB Straubel, from solely recycling batteries to also developing grid-scale energy storage solutions. This new venture addresses the critical infrastructure challenge of meeting the surging electricity demand from the artificial intelligence industry, which is straining existing power grids. Nvidia also participated in the funding round, which values Redwood at over $6 billion.