The mobility reverse mergers roll on.
Yesterday, battery maker QuantumScape said it would go public by merging with Kesington, a SPAC. When the deal closes (exp. Q4 2020), QuantumScape will be valued at $3.3 billion. The decade-old Stanford spinout is working on a deep tech problem: solid-state batteries.
Explain it like I’m five
Lithium-ion batteries, the Capri Suns for today’s EVs, have liquid electrolytes between the positive and negative sides. Lithium-metal batteries have...drum roll...solid electrolytes sitting in between.
Solid > liquid for a number of reasons, QuantumScape founder and CEO Jagdeep Singh told me. I’ll highlight three.
- Energy density: Solid-state batteries are more energy-dense, meaning they can have more capacity and could unlock 50-100% more range for EVs.
- Charge time: On average, EVs take hours to charge. Singh says QuantumScape's battery can recharge to 80% capacity in only 15 minutes.
- Safety: Lithium-ion batteries are prone to overheating and combustion. Singh says solid-state batteries are nonflammable and noncombustible.
“The way we look at it, a lot of the science risk is behind us,” Singh said. And the "biggest car company is basically saying they can't wait to put these in their cars by 2025."
Biggest carmaker by production, not market cap, that is
Volkswagen has invested $300 million in QuantumScape, with two-thirds of that coming this year. VW has already tested QuantumScape’s R&D batteries and the two companies are operating a joint manufacturing venture.
Bill Gates is a double-dipping investor in the company, having backed QuantumScape personally and through Breakthrough Energy Ventures. “When we first met with him, I went in thinking: ‘What does a software guy know about chemistry?’ I was blown away by the questions he asked,” Singh said. “He really is motivated by climate, clean energy. He sees that you can’t really address the emissions problem without addressing transportation.”
Big picture: QuantumScape is still pre-revenue, but EVs are riding high in public markets. Singh said QuantumScape’s post-SPAC-merger war chest of $1 billion+ will let it scale production and put batteries in cars.