Another unicorn has fallen.
A new addition to the Western "battery graveyard."
On April 9th, Ascend Elements, a unicorn company that carried the hopes of the entire U.S. lithium - battery recycling industry, officially filed for bankruptcy protection. Since its establishment, the company has raised funds in 12 rounds. Top strategic and financial investors such as Honda of Japan, SK Group of South Korea, Qatar Investment Authority, and Temasek have all joined in, with a cumulative financing of over $1.1 billion. Now, it has collapsed.
Ascend Elements is not an isolated case. According to incomplete statistics, since 2025, at least 14 startup companies in the European and American lithium - battery industrial chain have failed. This collapse is not the fault of one person, but the result of the simultaneous tightening of four nooses: technological risks, capital misallocation, policy fluctuations, and the impact of Chinese production capacity.
An innovation that can change the industrial landscape
The story of Ascend Elements dates back 15 years. At that time, the global battery recycling industry was still in a rough and inefficient stage. The standard process of traditional technology was to crush used batteries into "black powder," and then through a long metallurgical process - leaching, precipitation, filtration, extraction, drying, and calcination - gradually separate metal elements such as lithium, cobalt, and nickel into their respective sulfates or carbonates. The entire process involves more than 15 intermediate chemical steps, each of which consumes a large amount of energy and chemical reagents. The resulting acidic waste liquid and heavy - metal residues also pose a new environmental burden. More importantly, this "disassemble to atoms and then reassemble" path is not very cost - effective economically. The recycled metal salts have to re - enter the synthesis process of cathode materials and compete directly with primary materials directly refined from mines in terms of price, often having no advantage.
In 2011, in a laboratory at Worcester Polytechnic Institute in the United States, Dr. Eric Gratz and materials science professor Yan Wang put forward a bold idea: What if they could skip those cumbersome metal separation steps and directly convert the black powder into cathode precursor materials (pCAM) that could be directly installed in new batteries through precise hydrometallurgy? The revolutionary aspect of this idea is that it attempts to "intercept" the used battery before its crystal structure is completely destroyed and directly reconstruct qualified precursor particles.
The laboratory data is exciting. This patented technology, later named Hydro - to - Cathode, cuts out up to 15 intermediate chemical steps compared with the traditional long - chain process and can reduce carbon emissions by 49% to 90%. The produced pCAM is said to be comparable to, or even better than, materials refined from primary minerals in terms of energy density and cycle life.
This is a disruptive technology that "goes directly from waste to components." If it can operate on an industrial scale, it will completely rewrite the ecosystem of the battery material supply chain. Battery recyclers will no longer be just "scrap collectors" but will directly become suppliers of lithium - battery cathode materials, taking the highest - premium part of the value chain.
In 2015, Gratz and Wang started their business with this patent. In 2016, it received Series A financing from the U.S. National Science Foundation (NSF).
After 2021, with the explosion of the global electric - vehicle industry and the rise of clean - energy investment, Ascend Elements really became the darling of capital. From 2021 to 2024, it completed 7 rounds of financing, with more than 30 investment institutions participating, including many powerful industrial capitals, sovereign wealth funds, and top - tier investment institutions, such as Honda, SK Group, Jaguar Land Rover, American Lithium, Temasek, Qatar Investment Authority, Oman Investment Authority, BlackRock, Fifth Wall... In addition, it was also the favorite of governments around the world, approved for more than $600 million in financial grants from the U.S. Department of Energy and a subsidy commitment of about $320 million from the Polish government.
The influx of capital is not surprising. After all, a company with such a high ESG index was most in line with the appetite of capital at that time. And each investor had a clear strategic plan. Automobile companies like Honda hoped to get rid of their dependence on China in the electric - vehicle supply chain; SK Group was building a large number of factories in the United States and urgently needed a U.S. supplier to meet the requirements for the "U.S. content" of the supply chain; the Qatar Investment Authority represented the transformation of oil - producing countries into the new - energy track...
In January 2022, Ascend Elements' first factory, Base 1, began construction in Georgia, the United States. In August of that year, Ascend Elements announced that it would invest $1 billion to build a super - factory called Apex 1 in Kentucky. After completion, it will be able to provide battery materials for 250,000 electric vehicles per year. This is the first cathode precursor material factory of commercial scale in North America.
A company that is believed to change the global new - energy industrial - chain map is emerging.
The pain of mass production
However, there is a gap between the laboratory and the factory workshop that almost all European and American battery startups cannot cross. From Base 1 to Apex 1, both of Ascend Elements' factories can be described as failures.
Although the construction of Base 1 progressed quickly and it was officially opened in March 2023, and the product quality is said to have reached the battery - grade standard. But this factory is only for verification purposes. On the one hand, its production capacity is very small, and on the other hand, it has never solved the problem of yield fluctuations. More critically, shortly after the factory started operating, it was found that the local power supply, water supply, and other infrastructure in Georgia where it is located could not meet the needs of the factory, resulting in the inability to fully release the production capacity. These factors have made Base 1 operate at a loss since its completion and require continuous capital injection to maintain.
Apex 1 is even more of a disaster. In order to start production as soon as possible, Apex 1 adopted a very risky construction method of designing and constructing simultaneously. As a result, the entire construction site was in serious chaos: the drawings were not finalized, but the concrete had already been poured; the pipeline layout was still being debated, but the steel structure had already been erected. By the end of 2024, the construction was forced to be completely suspended to wait for engineers to re - sort out the misaligned design plans. At this time, the completion rate of the entire project was only 60%, and Ascend Elements had already begun to experience a tight capital chain. In February 2025, the general contractor of the Apex 1 project sued Ascend Elements, accusing the latter of randomly changing the design, which led to an inflation of construction costs and that it had owed $138.4 million in labor and material fees.
Apex 1 was originally planned to start production in early 2025, but now it has become an unmanageable mess.
Subsequently, the global new - energy industrial chain entered an over - supply cycle, and the clean - energy investment boom ebbed. Ascend Elements had difficulty obtaining new financing. The most fatal thing was that the remaining $316 million in the U.S. Department of Energy's grant was cancelled by the newly - elected president on the grounds that the project was "not economically viable." This directly led to the breakage of Ascend Elements' capital chain.
As a result, after raising more than $1.1 billion in total, Ascend Elements still failed to achieve mass production. Bankruptcy court documents show that most of its financing was poured into the unfinished Apex 1 project, leaving a long - term debt of $103.5 million and still owing $145 million to the contractor.
Why have Europe and the United States become the "battery graveyard"
Ascend Elements is not alone on the road to bankruptcy. Between 2025 and 2026, the European and American lithium - battery industries witnessed a bankruptcy wave like a "mass extinction." At least 14 well - known startup companies have failed one after another. The list is as follows:
iM3NY (USA)
Bedrock Materials (USA)
Northvolt (Sweden)
Li - Cycle (USA)
CustomCells (Germany)
Powin (USA)
Aleon Metals (USA)
Natron Energy (USA)
BMZ Group (Germany)
Lithion Technologies (Canada)
Ample (USA)
Trion Battery Technologies (Canada)
24M Technologies (USA)
Ascend Elements (USA)
The most well - known on the list should be Northvolt, known as the "European version of CATL." It officially filed for bankruptcy in Sweden in March 2025. This company had attracted more than $14 billion in investment from top - tier capitals such as Volkswagen, Goldman Sachs, and BMW, all of which went down the drain.
The first company on the list, iM3NY, was sold at a liquidation price of $10 million in April 2025. This company was founded by a related team of Nobel laureate Professor Whittingham. It once promised to "reshape American manufacturing" and was expected to create 2,500 jobs. However, it could never solve the production - technology bottleneck of its core battery - cell products and was finally liquidated after losing more than $100 million.
The companies on this death list have one thing in common: almost every one of them launched multiple parallel super - factory projects under the enthusiastic support of capital before their technologies could achieve stable profits; almost every one of them was highly dependent on government subsidies; and almost every one of them had serious chaos in the production process. In bankruptcy - application documents and media reports, words such as "lack of experience," "over - exaggeration," "low capital - use efficiency," and "poor management" appear frequently. That is to say, most of these companies' technologies seem good, and the market demand is real, which is why they were able to obtain huge financing. The reason for their failure is often that they cannot complete the construction of the factory on budget and on schedule.
While these European and American battery companies were struggling to debug their first production lines, the competitive pressure from across the Pacific Ocean came in an almost crushing manner.
From 2025 to 2026, the global lithium - battery market entered an extremely cruel cycle of price decline and over - capacity. Data from BloombergNEF shows that in 2025, the average price of Chinese battery packs was 56% lower than that in Europe and 44% lower than that in North America. This basically made the entire European and American lithium - battery industrial chain economically unfeasible.
An analysis article in The Battery Chronicle wrote that companies such as CATL, BYD, Samsung, and LG spent 15 years starting from operating small production lines before gradually achieving large - scale production. European and American companies tried to fill this 15 - year gap in 5 years, mainly through capital and exaggerated publicity. Therefore, "European and American companies need to put down their arrogance and admit that China is an obvious leader in terms of technology, scale, pricing, and quality. Before accepting this, it will be difficult for us to make substantial progress."
This article is from the WeChat official account "China Venture Capital", author: Tao Huidong, published by 36Kr with authorization.