Early Tesla investor backs firm that tracks metals supply chain

Tesla lithium ion battery power pack Image: Alexis Georges

An early Tesla Inc. investor is backing a startup that helps track battery metals across the supply chain to ensure they hold up to environmental and ethical scrutiny.

The Westly Group, which led a funding round with five other venture capital firms, invested $14 million in Circulor Ltd., according to a Thursday statement from the London-based startup. Circulor said it will use the investment for ongoing innovation and to extend its presence in North America and Asia.

Circulor is tapping into growing interest from companies seeking to ensure their operations can stand up to scrutiny on environmental and social issues. Manufacturers and automakers face increasing pressure from investors on how they source raw materials and produce products. Mining investors are particularly keen on ensuring that battery metals including cobalt, lithium, nickel and copper are produced ethically and in an environmentally friendly way amid a global push to reduce pollution in worldwide economies.

Circulor has already sold its product to the electric vehicle industry, helping automakers and suppliers track materials such as cobalt, mica and lithium, the statement said. The firm traces other commodities, including nickel, copper, plastics and leather, and is also used in areas such as the remanufacturing of auto parts.

Existing investors include the venture arms of airplane-builder Boeing Co., Swedish automaker Volvo AG and miner BHP Group. Companies including BHP, Polestar and Vulcan Energy Resources Ltd. are using Circulor’s technology to track and manage supply chains, support responsible sourcing and analyze supply-chain emissions.

“The real driver is a combination of consumer pressure and institutional capital wanting to see meaningful ESG progress,” Circulor chief executive officer Douglas Johnson‑Poensgen​ said in an interview.

The startup uses artificial intelligence, Blockchain and other technologies in its software platform. The system assigns a digital identity to commodities and track supply-chain data and environmental impacts at each stage of production through recycling to end-of-life to help companies address their objectives for environmental, social and governance issues.

© 2021 Bloomberg L.P.

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