Argentinian Startup Alkemio Just Raised $1 Million—Could This Transform Rare Earth Refining Forever?

As the world increasingly shifts towards renewable energy and electric vehicles, the importance of rare earth elements cannot be overstated. These crucial materials serve as essential inputs in technologies ranging from electric vehicles and wind turbines to smartphones and national defense systems. However, an alarming concentration of nearly 90% of global refining capacity is situated in China, leading to significant concerns over supply chain reliability and geopolitical tensions.

In response to these challenges, a Buenos Aires-based startup named Alkemio has emerged, successfully raising $2 million in pre-seed funding. The company aims to revolutionize the refining process by bringing it closer to the source, specifically targeting mining sites. Their modular, organic processing system is designed to minimize the need for transporting raw materials overseas, positioning Latin America to capture more value from its own mineral resources.

Alkemio's innovative approach involves replacing the traditional, chemical-intensive refining processes with a more sustainable method. The company plans to start with dysprosium, a heavy rare earth element used in electric vehicle motors and wind turbines. By utilizing organic materials for the separation process, Alkemio claims to achieve an up to 80% reduction in capital expenditures (capex) and a more than 70% cut in emissions, while entirely eliminating the use of toxic solvents.

The funding round saw participation from notable investors including Dalus Capital from Mexico City, VU Venture Partners from San Francisco, Amplifica Capital, the Argentine oil-and-gas corporate venture fund VX Ventures, and Epic Angels, a female investor collective making its inaugural investment in Argentina. Previously, Alkemio secured $400,000 from accelerators GRIDX and Skydeck Berkeley.

With this new funding, Alkemio is set to scale its lab prototype into a 100-kilogram commercial pilot in the United States, a significant step toward broader implementation of its technology.

Rethinking Rare Earth Sourcing

Alkemio is part of a growing movement of companies rethinking how rare earths are sourced and refined. For instance, Cyclic Materials in Canada focuses on recovering rare earths from end-of-life electronics and industrial equipment, while RarEarth in Italy specializes in recycling magnets using non-hazardous chemicals. Additionally, REEgen, based in Ithaca, New York, employs engineered microbes to extract minerals without the high heat typically required, and Niron Magnetics is developing permanent magnets that aim to eliminate the need for rare earth elements altogether.

Traditional rare earth refining is notoriously complex, requiring over 500 chemical steps and facilities so large that they can only operate efficiently at a massive, centralized scale. This model has led to a situation where almost no country outside of China has established a functional rare earth processing facility, leaving vast deposits across the globe unprocessed.

In light of growing trade tensions, mining companies throughout Latin America have begun stockpiling raw material instead of exporting it to China. Alkemio co-founder Ailín Svagzdys, a biotechnologist, asserts, “Rare earths are called rare, but they are not actually rare. They are present in almost the entire world, just in low concentrations. Every country is a potential place for a rare earth mine.”

With the increasing funding and focus on critical minerals, Svagzdys anticipates that numerous new projects will emerge in various regions far sooner than most experts expect. Alkemio, founded alongside two experienced partners—Federico Bonnet, who previously sold a company to Amazon, and Lorena Molina Calderon, a scientist with over 20 years of experience in rare earth separation—has already signed pilots and letters of intent with mining companies in Latin America, the United States, and Canada.

As the call for sustainable and reliable refining of rare earth elements becomes ever more urgent, Alkemio stands poised to play a significant role in reshaping the landscape of rare earth sourcing. According to Maaike Doyer, founding and managing partner at Epic Angels, “The world urgently needs the ability to refine rare earths sustainably and reliably, wherever the deposits are.”