Bucking EV Slowdown, Sila Raises $300 Million to Expand Battery Materials Factory

Battery materials startup Sila announced Tuesday that it raised $300 million to expand its factory in Washington state to produce enough anode material for more than 100,000 EVs. The expansion arrives as electric vehicle demand in the U.S. has softened in the wake of the Trump administration's efforts to hamstring the propulsion technology. While sales remain depressed in the U.S., down this year relative to 2025 when demand spiked before the sunset of tax credits, EVs are taking a bigger slice of the market elsewhere. According to Benchmark Minerals Intelligence, global sales are up 27% year over year.

The new funding round was led by Atreides Management and Sutter Hill Ventures with participation from 8VC, Bessemer Venture Partners, Matrix Partners, and funds and accounts advised by T. Rowe Price Associates Inc. Sila previously raised about $1.3 billion across previous rounds, according to PitchBook.

A Decade and a Half of Development

Sila has been developing its silicon-carbon anode material for the last 15 years. Its founder and CEO, Gene Berdichevsky, previously worked at Tesla, where he was the seventh employee. The startup began production at its Moses Lake, Washington, plant last September. The factory is capable of making up to 2 gigawatt-hours of silicon-carbon anode material. The expansion will allow the plant to produce tens of gigawatt-hours per year, enough to power more than 100,000 EVs.

In addition to being an alternative to Chinese graphite, Sila's anode material can store up to 40% more energy than traditional graphite anodes. It can also charge faster. This performance advantage makes it an attractive option for automakers and battery manufacturers looking to improve the range and charging speed of their EVs.

Reducing Reliance on Chinese Graphite

Most lithium-ion batteries today use graphite anodes, and Chinese companies control about three-quarters of the supply chain, according to Benchmark Minerals Intelligence. That has spurred automakers outside of China to search for alternatives that aren't subject to tariffs. Sila's anode material is one of the few alternatives that's available in sufficient quantity.

The company has previously announced deals to supply its anode material to Mercedes and Panasonic. It also sells to consumer electronics companies such as Whoop and to drone manufacturers and satellite companies. These partnerships demonstrate the versatility of Sila's technology and its appeal across multiple industries.

Beyond EVs: Energy Storage Systems

While EVs are the biggest user of lithium-ion batteries, energy storage systems have been taking a bigger piece of the market as demand for electricity grows. AI data centers have become major buyers of grid-scale batteries. The packs can serve as backup power sources, help trim peak demand charges, and allow for around-the-clock use of solar and wind power.

Sila's anode material could play a significant role in this growing market, offering the same performance advantages for stationary storage as it does for EVs. The ability to store more energy in a smaller space is particularly valuable for grid-scale applications where space is at a premium.

Sila's $300 million funding round is a sign of confidence in the company's technology and its ability to scale production. The expansion of its Washington state factory will allow the company to produce enough anode material for more than 100,000 EVs, helping to reduce reliance on Chinese graphite and supporting the growth of the electric vehicle market. As global EV sales continue to rise, Sila's silicon-carbon anode material could play a critical role in the transition to a more sustainable transportation system. The company's ability to deliver on its promises will be closely watched by automakers, battery manufacturers, and investors alike. With a decade and a half of development behind it and a growing list of partners, Sila is well-positioned to capitalise on the growing demand for advanced battery materials. The next few years will be critical as the company scales production and works to bring its technology to a wider market. If successful, Sila could help reshape the battery supply chain and accelerate the adoption of electric vehicles worldwide. For now, the company is focused on expanding its production capacity and delivering on its commitments to its partners. The future of battery technology may well depend on the success of companies like Sila. The road ahead is challenging, but the potential rewards are immense. As the world continues to transition to a cleaner, more sustainable energy system, Sila is poised to play a key role in shaping that future.