Founded by financier Ian Osborne, Hedosophia is a low-profile venture capital business that specializes on software. Some of the startups it has backed include PolyAI, an AI-powered speech specialist, Qonto, an e-commerce company, and Gopuff. However, the company’s most recent investment makes clear that fusion energy is a fresh area of interest for it. The pre-revenue fusion-tech startup Xcimer has revealed that Hedosophia led a $100 million Series A round of funding, the company said on Tuesday.
Hedosophia’s lead position in the Xcimer round offers a unique look into the company’s readiness to invest in deep-tech businesses, which are typically significantly more capital-intensive than lighter-touch software companies and require a lot of research and development to get sales momentum.
Xcimer, which was recently established in 2022, is working on a high-energy laser system with the goal of supplying the grid with fusion power within the next ten years. Although the deal amount represents a significant increase over Xcimer’s seed round, which closed in 2022 on $2.5 million, the company’s founders declined to disclose a valuation. Prominent climate-tech investors Lowercarbon Capital and Breakthrough Energy Ventures were among those taking part in the Series A.
According to Conner Galloway, CEO and chief scientific officer of Xcimer, the funding process came together in about nine months and benefited from having investors with expertise in climate change. Galloway stated that “some of the ultra-high-net-worth LPs at these firms care about climate” and are the driving force behind more climate-tech bets. “Some of our investors have a long time horizon and are specifically interested in deep-tech climate change technologies with a 10 to 20 year investment horizon,” Galloway said.
Dealmaking in the climate-tech space has shown to be extraordinarily resilient to the venture slowdown, even as SaaS and fintech values decline. According to PitchBook data, fusion energy is still mainly unproven commercially, but as businesses like Commonwealth Fusion Systems and TAE have expanded, VC interest in the technology has increased.
According to Alexander Valys, CTO and president of Xcimer, the company plans to build a new prototype laser facility in Denver and hire an additional 70 employees using the funds raised from its all-equity raise. While roommates at the Massachusetts Institute of Technology, Valys and Galloway initially got to know one another.
Established by Osborne in 2012, Hedosophia maintains strict confidentiality on its investments and is most recognized in the sector for having co-founded a SPAC with Chamath Palihapitiya of Social Capital. It was raising $1.4 billion through two venture capital funds in 2021.
