One of the co-founders of Toronto-based human resources software startup Humi has raised Series A financing for his latest venture: nuclear power startup Aalo Atomics.
Austin, Texas-based Aalo announced earlier this month that it has raised $27 million USD. The round was co-led by pre-seed and seed focused VC firm Fifty Years and SpaceX backer Valor Equity Partners, with participation from Harpoon Ventures, Crosscut, SNR, and Alumni Ventures, among others.
“Being from Ontario, which is mostly nuclear powered, I always knew nuclear was incredible, but I wasn’t sure if it would be possible to build a successful business in it.”
This is Aalo’s second fundraise in the last 16 months. The startup raised $6.26 million USD in seed financing in April 2023.
Aalo wants to bring down the cost of nuclear power under the leadership of Canadian co-founder and CEO Matt Loszak. Back in 2016, Loszak and Kevin Kliman co-founded Humi, which offers human resources, payroll, and benefits software for Canadian businesses. Kliman still serves as Humi’s CEO.
In an emailed statement, Loszak told BetaKit that he was Humi’s technical co-founder, who helped to build the startup’s minimum viable product. He then went on to work on Humi’s marketing and product efforts.
For six years, Loszak helped build Humi, growing it to a staff of 150 people. He became interested in cleantech and is now based in Austin, but remains a member of Humi’s board, according to his LinkedIn page. Loszak said Kliman was also an early investor in Aalo.
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“Many of the early-stage Humi investors were involved in Aalo’s seed round as well, including many that we met at [Y Combinator] in [San Francisco],” Loszak added.
Loszak graduated from the engineering physics program at Queen’s University. He told BetaKit his goal with starting Aalo was to take what he learned about software and business at Humi and eventually return to his roots to start a more technical company.
“Being from Ontario, which is mostly nuclear powered, I always knew nuclear was incredible, but I wasn’t sure if it would be possible to build a successful business in it,” he said.
After some months researching clean technologies, such as carbon capture, solar, wind, grid storage, geothermal, hydrogen, and nuclear, he found nuclear to be one of the most “polarizing” topics in the cleantech space.
“Some people think it’s the only thing that can ‘save us’ from global warming, while others think we shouldn’t touch it with a ten-foot pole,” Loszak wrote in a 2022 Medium post.
He noted the main criticisms toward nuclear energy were the high cost of the resource compared to oil and gas. He said he believes this is driven by several factors, including the complexity of nuclear power, a lack of government support, a lack of standardization and experience, over-regulation, and the presence of what he deemed to be “dinosaur companies” in the nuclear sector.
“Nuclear is the most misunderstood technology that I’ve ever come across, and I think it’s inevitable that it will play a huge role in powering humanity’s future,” he told BetaKit. “The only question is how soon that transition will happen, and we’re doing everything we can to accelerate it.”
Aalo was incorporated in 2022. Its first product, currently in development, will be a reactor called the Aalo-1, which is inspired by the Idaho National Laboratory’s Microreactor Applications Research Validation and Evaluation (MARVEL) microreactor. According to the laboratory, MARVEL is expected to come online as soon as late 2026.
Aalo claims its nuclear technology will be able to reduce costs and improve safety by using a combination of metallic coolant and uranium zirconium hydride (UZrH) fuel. According to the company, the metallic coolant extracts heat from the reactor core more efficiently than current technology, which it claims could enable Aalo reactors to produce up to 10 times more energy than similarly sized technologies.
The company says UZrH fuel automatically shuts down if it overheats, which Aalo says allows for simplified safety systems and further cost reductions. The company also asserts that its modular reactor design facilitates faster on-site assembly, with factory-pre-assembled modules intended to minimize construction time and costs.
In the last nine months, Aalo has claimed that it has finished conceptual design of the Aalo-1. Its current team includes leaders from the MARVEL program.
The startup has also signed a memorandum of understanding with the United States Department of Energy, which it called the first step towards deploying an experimental reactor at the Idaho National Laboratory site.
It has also submitted a regulatory engagement plan to the US Nuclear Regulatory Commission, with agreement from a first potential customer.
Feature image courtesy Aalo Atomics.