Phoenix Tailings

Introduction to Phoenix Tailings

** Update **  
Following the announcement this past Friday that China would be restricting exports of Rare Earth Metals and products to all countries in what appears to be a retaliation to recent tariffs imposed by the US, the importance of Phoenix Tailings' business and technology has become even more significant. Read more on the recent moves from Reuters here, including a quote from Phoenix Tailings Co-Founder & CEO, Nick Myers.‍

Introduction
Phoenix Tailings is a US-based Series B-stage metals refining company disrupting the $350B critical materials market. Phoenix has developed a novel and proprietary refining process which enables a profitable zero-emission domestic refining operation to meet the needs of the global energy transition. Phoenix is raising a $40M Series B round led by Envisioning Partners with participation from leading investors in the hardtech and cleantech sectors, including In-Q-Tel, BMW I-Ventures, Yamaha, and MPower. The use of proceeds from the round will be to finance the expansion of production from the Company’s current 40 ton per annum (tpa) capacity to a 193tpa capacity to meet the volumes of a $197M supply agreement that the company has signed with a leading rare earth magnet manufacturer.

The global transition from hydrocarbons to critical metals signifies a major paradigm shift in the energy and manufacturing sectors. As the world seeks to combat climate change and reduce greenhouse gas emissions, the demand for fossil fuels is being replaced by the need for critical metals like lithium, cobalt, nickel, and rare earth elements. These metals are essential for renewable energy technologies, electric vehicles, advanced electronics, computing, and even the AI data centers powering the next generation of technological innovation.

See the video below for a look into Phoenix Tailing’s patented and zero-emission critical minerals refining process and how it unlocks a fully domestic supply.

Highlights

* Significant Current Customer Traction: Phoenix Tailings has secured significant customer traction, with a signed $197M supply agreement with SGI, a leading rare earth magnet manufacturer in the automotive space, and a pipeline of $1B+ from customers in the electronics, industrials, and medical devices space. This existing agreement fully books out the Company's production capacity for 2025 as they expand their modular facility to commercial capacity.

* Proven Technology: Phoenix has fundamentally re-engineered the metals refining process through a proprietary ‘Predictive Complexation’ technology augmented by AI-powered novel chemistry. The Company has discovered a proprietary formulation for rare earth stabilized ion reduction (SIR) salts that can be tuned to enable faster and more efficient reactions, creating a scalable and profitable model for metal refining.

‍* Geopolitical Climate Tailwinds: At present, Phoenix Tailings has the only operational rare earth metal refinery in the Western Hemisphere and the first end-to-end sustainable process in the world. Existing Rare Earths Metal production is 90%+ based in China & Myanmar with significant environmental repercussions. The US Government has identified rare earth metals as a critical national security concern given its importance in key technologies, with support across all levels of government including the DoD and the Department of Commerce.

‍* Clean Technology For the Future: Compared to traditional technologies, Phoenix Tailings’ chemistries are designed to drastically reduce the overall process’s environmental footprint. The systems are designed to have zero CO2, chlorine, sulfur, nitrate, or fluorine emissions. While each step in the process does produce CO2, the overall system has zero emissions, creating a sustainable source of critical metals for American and global industries.

‍* Strong Strategic Investor Group: Phoenix Tailings has built a strong diversified strategic investor group, including notable venture firm In-Q-Tel and strategic investors including Presidio Ventures (Sumitomo Corporation), BMW I-Ventures, and Yamaha. Phoenix Tailings has raised $28M in equity financing to date, in addition to $5M in non-dilutive grant funding from DOE, NSF, Mass Ventures and others.

‍* Global Market Opportunity: The global critical metals market was valued at $320B in 2022 . This market is composed of various segments, including mining, processing, and end-use applications such as electric vehicles (EVs), renewable energy technologies, and electronics. Due to the relatively high price point and key technology gaps in traditional processing, Phoenix Tailings has entered the rare earth market first before expanding into other critical metals markets

‍* Strong and Experienced Leadership: Phoenix Tailings' leadership team brings a wealth of experience across strategy, finance, technology, operations, and partnerships. CEO Nick Myers has a strong background in finance and partnerships, with leadership roles at Meenta and SparkCharge, and a foundation in physics and business. Co-Founder and Advisor Michelle Chao brings operations and engineering expertise, including successful product launches and R&D leadership in 3D metal printing. CTO Dr. Thomas Villalon Jr. is a distinguished technology expert with a PhD in Materials Science & Engineering, specializing in novel materials processing. VP of Partnerships Anthony Balladon has a diverse background in commercial strategy, research, process engineering, and private equity analysis.

Investment Opportunity

Plum Alley Ventures Company is presenting this Series B investment as a new opportunity in Phoenix Tailings. This round is led by Envisioning Partners Impact Fund ($140M+ in AUM), with participation from In-Q-Tel and strategic investors including Presidio Ventures (Sumitomo Corporation), BMW I-Ventures, and Yamaha. The Company initially set out to raise up to $40M at a $130M pre-money valuation, but due to investor interest the round was extended to be up to $60M, with $41.3M currently funded.

The primary use of proceeds will be for the Company's next refining facility and its first fully integrated commercial-scale refinery, capable of fulfilling the $197M contracted offtake agreement. This facility represents the primary capital buildout from the Series B raise, with $13M allocated for CAPEX, and is expected to generate $20M in annual revenue at full production, and $5M in gross profit.

More information on the terms of the round can be found in the ‘Capitalization & Current Raise’ Section below.

‍INVESTMENT TIMELINE

‍Virtual Company Presentation

Tuesday, April 8th, 2025

3:00pm ET // 12:00m PT

RSVP to Google Calendar Invite

Call Details Available Here

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Final Investment Commitments Due

Friday, April 11th, 2025

We will take commitments on a rolling basis. Please submit final commitments here. 

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Funding & Documents Due

Wednesday, April 16th, 2025

At the end of the commitment period, you will receive details regarding closing documentation and wiring instructions via Carta.‍

The Company's confidential financing documents and diligence materials are available for review in DropBox. Please request access to data room materials at the top of the page. All documents are confidential and not for further distribution. If you have specific questions or are interested in investing in Phoenix Tailings, please contact us and submit your investment total here. Given the expedited Syndication timeline to meet Phoenix's Series B closing date, if the PAVC Syndicate does not meet certain milestones it may not move forward.

Overview: Critical Metals & Domestic Supply

Global Need for Critical Metals:
Phoenix Tailings is built to be the world’s first fully clean mining and metals production company, creating the needed materials for the energy transition and the advancement of high-end technologies. Phoenix’s long-term vision is to build a fully vertically integrated business to produce rare earth metals (REMs) and other critical metals from non-traditional sources such as Tailings. Rare earth metals have become essential components in the rapidly evolving landscape of climate technologies and computing, and remain critical components to traditional electronics, automotive and medical device manufacturing given their unique traits and capabilities. These materials sit at the intersection of two major technological trends: the transition to clean energy and the explosive growth of AI computing infrastructure. However, global supply is dominated by China and Russia, which control 95%+ of refining operations, in part due to the significant environmental impact existing processes have on surrounding areas.

‍What are Rare Earth Metals:
Rare earth metals were first discovered in Sweden in 1787. Throughout the 19th and early 20th centuries, scientists gradually isolated individual rare earth elements, but their commercial applications remained limited due to the complexity of their extraction and separation. 

Rare earth metals, despite their name, are relatively abundant in the Earth’s crust, but they are significantly less common than metals like iron and copper. However, unlike iron and copper, which occur in high concentrations and easily minable ores, rare earth metals are typically dispersed in low concentrations across a variety of minerals, making their extraction and separation far more complex and resource-intensive.

It wasn’t until the mid-20th century that their unique properties, particularly their exceptional magnetic, luminescent, and conductive characteristics, were recognized as essential for advanced technologies. The development of powerful neodymium-iron-boron (NdFeB) magnets in the 1980s revolutionized industries such as electronics, clean energy, and telecommunications, cementing the importance of rare earth metals in modern manufacturing.

‍Rare Earth Metals Use Cases:

The fundamental characteristics of rare earth metals, including their high magnetic strength, heat resistance, and conductivity, make them indispensable in applications that require miniaturization and high efficiency. 

For instance, neodymium and dysprosium are used to create powerful permanent magnets that improve the performance of EV motors and wind turbines by enhancing energy conversion and reducing power loss. Lanthanum and cerium are critical in battery technology and catalytic converters, while yttrium and europium are key components in advanced medical imaging devices and LED displays. In data centers and high-performance computing, rare earth elements contribute to the efficiency of cooling systems and the development of high-speed processors. 

Their unmatched ability to maintain stability at high temperatures and their superior magnetic and conductive properties make rare earth metals irreplaceable in modern technologies, driving innovation across industries.

• Climate Technology: Renewable energy systems, electric vehicles, and energy storage solutions all rely on the magnetic properties of REMs to create, retain and store energy for long term sustainable energy.
• AI Data Centers: The AI boom is driving continued demand for specialized computing hardware like advanced semiconductors, cooling systems, and power infrastructure, all of which rely on REMs to operate at the levels required for high-powered computing.
• Automotive: In addition to the need for REMs in electric vehicles, traditional automotives also use them for catalytic converters and various electronic elements that are becoming increasingly standard in modern cars and trucks.
• Medical Devices: Diagnostic equipment, like MRI machines, X-Ray and CT systems, and surgical and therapeutic devices like surgical robots, implantable devices like cochlear implants, and radiation therapies are also reliant on REMs.

Supply Chain Challenges:
Manufacturers dependent on rare earth metals (REMs) face significant supply chain challenges across mining, refining, and production stages. These challenges include:

• Chinese Market Dominance - China maintains overwhelming control of the global rare earth supply chain:
  
  • 63% of global rare earth mining
  • 85% of rare earth processing
  • 92% of rare earth magnet production

This concentration creates significant vulnerabilities for manufacturers, as evidenced by China's past export restrictions to countries like Japan in 2010-2011 1. The monopolistic control allows China to influence global prices and availability of these critical materials.

• Environmental and Regulatory Challenges - Rare earth mining and processing create severe environmental impacts:
  
  • Open-pit mining consumes high energy and disrupts ecosystems
  • Processing creates water pollution and radioactive waste issues
  • China's State Council has acknowledged "intense harm to the ecological environment" from rare earth mining
  • As environmental regulations tighten globally, manufacturers face increasing scrutiny about the sourcing of their materials, with China expected to enforce stricter environmental regulations that will incorporate environmental costs into rare earth production

• Traceability and Transparency Issues - The rare earth supply chain suffers from significant transparency problems:
  
  • Complex global supply chains make tracing material origins difficult
  • Limited documentation of supply chain activities
  • Lack of standardized tracking systems
  • Different tracking systems, formats, and data availability across regions
  • These issues make it challenging for manufacturers to verify ethical and environmental standards or comply with emerging regulations like the European Green Deal or the Critical Raw Materials Act

• Market Volatility and Supply Constraints - The rare earth market experiences significant volatility:
  
  • Demand for rare earth magnets (30% of the market) is rapidly increasing due to growth in electronics, wind turbines, and electric vehicles
  • Supply of elements like lanthanum and cerium is anticipated to fall short of demand

These issues underscore the need for sustainable, reliable and domestically sourced and produced rare earth metals to maintain and expand critical supply chains for these industries.

Technology & Process

Predictive Complexation

Phoenix Tailings is on a mission to become the world’s first vertically integrated manufacturer of rare earth metals. To accomplish this, the company completely redesigned its chemistry and reaction kinetics to enable scalable and repeatable refining methods. The fundamental breakthrough that Phoenix discovered is a proprietary formulation for rare earth stabilized ion reduction (SIR) salts that can be tuned to enable faster and more efficient reactions – this is the basis of the company’s “Predictive Complexation” approach, which leverages a series of proprietary algorithms and models to create novel chemistries for each step of the extraction and refining processes.

Specifically for refining, Phoenix’s trade secret methods force the metal ions to form novel complexes in a chemistry known as coordination chemistry, where metal ions (lewis acids) form bonds with cation ligands (lewis bases) in ways that stabilize the molecules in the molten state.  By creating certain desired metal-ion complexes, the process of refining metals can be greatly enhanced – so much so that the company can completely redesign the equipment to process the refining to enable continuous, closed-off, more energy efficient, and zero waste production systems with very long cell and electrolyte lifetimes.

The breakthrough chemistry, which is also highly scalable compared to traditional chemistries, enables the entire system to work cheaper, faster, longer, and with less emissions. All of these improvements have led to a significant (and growing) patent and trade secret portfolio.

Overall, Predictive Complexation drives not only chemistry improvements, but also equipment and process improvements that when combined enables a truly disruptive end-to-end clean metal production platform.

‍Refining: Separation & Metallization

As discussed above, the process of refining metal is broken down into two core components: separation, and metallization.

• Separation: The process of separating concentrates into pure oxides. Phoenix’s chemistries enable higher separation factors, reducing the amount of mixer settler equipment required, the concentration of acid, and the reaction time in solvent extraction (SX). Phoenix can leverage existing off-the-shelf equipment in an improved process flow with less equipment overall compared to traditional methods.
• Metallization: The process which converts powder oxide into metal bars. The novel chemistries have allowed Phoenix to redesign the rare earth metallization cells to lower operating temperatures, voltage, and energy consumption compared to traditional Chinese equipment. Inspired by the Infinium technology, this system is Phoenix’s cutting edge platform that enables the company to compete at a global level.

To date, Phoenix Tailings has produced the metal below at their Burlington MA pilot production facility:

• Pure Neodymium (Nd) Metal
• Neodymium-Praseodymium (NdPr)
• Dysprosium Iron (DyFe) Alloy:

The company has also run separation circuits for over 1000 hours, producing NdPrO3 from market carbonate concentrate, further converted to 99.9% NdPr metal.

Phoenix Tailings currently purchases concentrates from traditional sellers, but in the future will be able to extract its own concentrate directly from tailings sites. The company’s extraction technology will bring a paradigm shift to the mining industry – rather than continuing to destroy the planet to access new ore bodies, Phoenix is building a future in which the company cleans up the planet by harvesting what are currently considered valueless toxic tailings that actually have exponentially more resource availability than traditional sources.

‍Intellectual Property
Phoenix Tailings has filed 18 families of patents in the US and internationally. 4 patents have been issued in the US, with 15 pending non-provisional patent applications and 7 pending provisional patent applications. Phoenix Tailings’ overall IP strategy can be broken down into two core categories with novel chemistry formulations developed by its Predictive Complexation technology protected with trade secrets and the enabling hardware and processes for commercialization protected by patents.

Business Model & Traction

Phoenix Tailings’ business model is to source concentrates as an input, extract, and refine the metals within them, and sell final metal products (initially rare earth metals but will expand into other critical metals) to customers. Initially, Phoenix is currently purchasing concentrates from various suppliers on the market. However, in the future, the company will source its own concentrates by securing tailings sites – this will help drive dramatic margin expansion.

The direct sourcing of concentrate from tailings brings in an additional opportunity for value creation. Phoenix’s strengths in minerals exploration and development helps the company acquire legacy tailings sites at low costs, which will then be economically characterized and de-risked in order to either obtain low-cost financing or be sold at a premium, generating substantial return compared to the capital required to develop them.

‍Key Markets
OEMs and End Manufacturers: End OEMs and Tier-1 suppliers are the major end customers for Phoenix Tailings. They are the ones driving the push to a Non-China supply chain down to their suppliers. It is often they who make the final decisions on rare earth deals, even when the actual contract is with a magnet manufacturer.

Magnet Manufacturers: Magnet companies are the primary users of Phoenix’s product, converting the metals into magnet form. There are 7 major established manufacturers outside of China, three of which have signed MOUs with Phoenix Tailings. All of these magnet manufacturers have extensive growth plans and are collectively constructing ex-China capacity totaling 25,000 tpa of magnets (requiring ~9,000 tpa of metal) by 2028. Given that US demand for ex-China magnets is projected to reach 10,000 tpa by 2030 with Europe and Asia reaching approximately 50,000+ tpa, a growing incentive for new magnet manufacturers to enter the market is expanding the overall size of this market.

‍Commercial Traction
To date, Phoenix Tailings has secured commercially contracted metal sales of $197M through 2031 with SGI in Korea, one of the world's largest magnet manufacturers. In addition, Phoenix has an increasingly robust pipeline of signed non-binding MOUs worth over $1B.

Secured Offtakes

• $197M Signed Automotive Contract - Phoenix’s largest contract is with SGI, a South Korean magnet manufacturer that supports the automotive industry. This deal outlines the next 8 years of supporting BMW’s new EV platform, “BMW Vision Neue Klasse.” At its peak, this contract is expected to support up to 250,000 vehicles per year.

MOUs & Pipeline

• $1B Electronics Contract - Phoenix has secured a non-binding MOU for 2,000 tons of NdPr per year from a Taiwanese magnet manufacturer. This deal supports the broader electronics industry, with end OEMs making final purchasing decisions.
• $15M Industrial Contract - Phoenix has secured a non-binding MOU with a European magnet manufacturer supporting the industrial and defense industries. This MOU could expand as the company grows and is in advanced discussions with end OEMs to convert this into a full offtake agreement.
• $20M Tier-1 Medical Devices Contract - Phoenix has secured a non-binding MOU with a leading global Tier-1 manufacturer supplying the medical devices industry.

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Beyond the initial traction, Phoenix has built a robust pipeline of over 430 active deals across the entire spectrum of industries. In the context of this pipeline, MOUs are considered in the “Negotiating” stage. Further details on the Company’s financial projections can be found in the Data Room.

Market Opportunity & Competitive Advantage

The global critical metals market was valued at $320B in 2022. This market is composed of various segments, including mining, processing, and end-use applications such as electric vehicles (EVs), renewable energy technologies, and electronics.

Notably, a report from the DOE at Argonne National Labs estimates the demand for rare earth magnets growing nearly 600% by 2050. This puts tremendous pressure for manufacturers to diversify supply chains and lock up long term supply agreements.

Key Segments

1. Rare Earth Metals (REMs): The REM market is estimated to be worth $7B annually, encompassing elements like neodymium, praseodymium, and dysprosium, which are crucial for magnets used in wind turbines, EV motors, and electronics. It is expected to grow to $13B by 2040.

2. Lithium Metal: The market for Li metal, driven primarily by its use in solid state batteries, is valued at ~$2.5B annually. Forecasts show a critical bottleneck due to the lack of metal production capability. It is expected to grow to $13B by 2040.

3. Cobalt: With a market size of $7B, cobalt is essential for battery production and other high-tech applications. The market is facing challenges due to ethical concerns over mining practices in the Democratic Republic of the Congo (DRC), which supplies the majority of the world's cobalt. It is expected to grow to $15B by 2040.

4. Nickel: The nickel market, valued at $50 billion, is buoyed by its use in stainless steel production and batteries. The shift towards high-nickel battery chemistries for EVs is a major growth driver. It is expected to grow to $143B by 2040.

5. Copper: The copper market, valued at $220B, is driving the trends in renewable energy, EVs, increased construction and electrification. It is expected to grow to $330B by 2040.

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 Due to the relatively high price point and key technology gaps in traditional processing, Phoenix Tailings has entered the rare earth market first before expanding into other critical metals markets. Phoenix Tailings currently focuses on three rare earth pure metals and two metal alloys which are outlined below that are used to make magnets. Prices for calculation are taken from Shanghai Metals Market.

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The markets can be volatile, with the price per kilogram (kg) of DyFe, NdPr, and Tb fluctuating dynamically. However, since Phoenix will be buying market oxides initially until separation is online, and those oxide prices tend to mirror the final metals price, margins are insulated from volatility in the short to medium term.

‍Competitive Advantage

Phoenix aims to be the first domestic fully vertically integrated rare earth producer. Across each part of the value chain, Phoenix also has key competitive advantages over both existing traditional rare earth refining techniques as well as from emerging players in the industry.

Separation
In separation, Phoenix’s is mainly competing against existing separation facilities used in traditional rare earth refining. However, there are several companies in the US that are working to scale up their separation capabilities – these include Energy Fuels, General Atomics, MP Materials, and potentially USA Rare Earths. 

While the equipment for separation is off-the-shelf, Phoenix has significant technical advantages. Phoenix has redesigned the flow sheets to require less equipment, 80% less labor, 65% less reagents and 60% less energy. As a result, there is an overall 38% OPEX improvement over the traditional separation process. This is due to the company’s predictive complexation approach to design novel chemistries.

Metallization
Phoenix’ aims to be the only domestic fully vertically integrated rare earth producer is primarily made possible by its proprietary metallization capabilities. While other companies may be able to mine or separate rare earths, being able to metalize the oxides persists as highly difficult for others to replicate outside of China. One exception is Less Common Metals, a UK-based company that has attempted to introduce the Chinese metallization process outside of the country. However, they have very limited production capacity and have not achieved significant market traction, likely due to unfavorable unit economics facing the Chinese-metallization process.

Further details on the Company’s competitive advantage can be found in the Data Room.

Capitalization & Current Raise

Capitalization
Prior to the current Series B round, Phoenix Tailings has raised a total of $28M across Series Seed ($1.68M, 2020), Series A ($8.8M, 2021), and Pre-Series B SAFE ($17.5M, 2023) rounds. Additionally, the company has received a total of $4.9M in non-dilutive government funding from the DOE, NSF, Mass Ventures and others. Most recently, this includes the $1M ARPA-E ROSIE grant, demonstrating third party validation of the company’s innovative iron technology.

Notable investors in Phoenix Tailings include:

• Envisioning Partners: The Series B lead investor, Envisioning Partners is an impact venture capital firm with operations in the U.S. and South Korea, focused on investing in compelling businesses with impact-oriented solutions. The firm has $140M+ in AUM, and has been investing since 2021.
• In-Q-Tel: Founded in 1999, In-Q-Tel operates as a non-profit organization that invests in technologies relevant to national security across sectors. The company partners with startups that develop technologies and evaluates their potential to meet government mission needs. To date, the firm has supported more than 400 firms with an average investment amount of $500-$700M annually over the past 5 years.
• BMW I-Ventures: Founded in 2011, BMW i Ventures operates as a venture capital firm focused on investing in high-performance companies within the hardware, software, and sustainability sectors. The firm provides capital, strategic partnerships, and access to an ecosystem of specialists to support startups in the manufacturing, transportation, and service industries, with 148 investments in its portfolio.
• Yamaha Motor Ventures: Yamaha Motor Ventures is a global venture capital firm with $300M+ in AUM that invests in early-stage startups in the transportation sector. The company provides engineering support to its portfolio companies, utilizing Yamaha Motor's capabilities.
• Hanwha FutureProof: The venture investing arm of Hanwha Group, the Korean technology firm, with access to the firm's aerospace, defense, and broad ranging technology and sustainability operations.

Phoenix Tailings has secured a diverse group of investors that have the capability to support the Company both in future financing rounds and in industry connections and support. 

‍Series B Use of Proceeds
Today, Phoenix Tailings has scaled its refining technology from lab to pilot scale in its Burlington, MA facility, and is producing products to satisfy its commercial offtakes. The proceeds from the Series B will go towards scaling the refining operations up to a profitable commercial scale facility, which will enable the company to deliver on its first major commercial contract and unlock future commercial facilities which will be funded by project financing. 

‍Series B Financing Terms:

Leadership Team

‍Nick Myers (Co-Founder & CEO)

Strategy and finance leader. Prior to Phoenix, Nick was Director of Finance and Partnerships at Meenta, COO at SparkCharge, and Lead Associate at Techstars Boston.  Nick also Founded and was a Director at Northeastern Angels. MBA from Northeastern University and a B.S. in Physics from Saint Michael’s College.

Michelle Chao (Co-Founder & Advisor)

Operations and engineering leader. Prior to Phoenix, Michelle was a Technical Product Manager at Markforged, where she managed the materials product portfolio, launching five new material products in 2019 alone. Her leadership in a project that doubled print speed was instrumental in helping Markforged achieve a $25M quarterly revenue milestone. As a Materials Engineer, Michelle led R&D efforts for a novel metal 3D printing platform, overseeing the design and management of a metallurgical analytical lab.

‍Dr. Tomás Villalón Jr. (Co-Founder & CTO)

Distinguished technology expert. Prior to Phoenix, Tomás was a Research Scientist at Digital Alloys, where he developed analytics and computational models to optimize the Joule Printing Process. Ph.D. in Materials Science & Engineering from Boston University, pioneering solid oxide membrane processes for high-purity silicon and aluminum production. B.S. Materials Science & Engineering, MIT.

Anthony Balladon (Co-Founder & VP, Partnerships)

Commercial and strategy leader. Prior to Phoenix, Anthony was a Research Analyst at Mintek working on hydrogen fuel cell technology development, Process Engineer at Colibri leading feasibility studies and client relationship management, Private Equity Analyst at a Search Fund Accelerator, and Business Development Consultant at Crimson Hexagon. Bachelor in Chemical Engineering from the University of Cape Town and Master of Science and International Business and Finance from Hult International Business School.

Rick Salvucci (VP, Downstream Processing)

10 years of experience in optimizing and scaling electrochemical processes. Led scale-up efforts at Infinium, Inc. for Nd, NdPr, DyFe and Al-Master alloys as Development Engineer & Project Manager. Currently leads metallization and separation engineering development at Phoenix Tailings.

Alex Nyarko (VP, Upstream Processing)

Over 20 years of experience designing and commissioning new mining and metals production facilities. He began his career as a Metallurgist involved in the day-to-day operation of a gold processing plant owned by AngloGold Ashanti. He then went on to join the EPMC & design houses, working in numerous geographical areas and locations.

Exit Scenario Analysis

Disclaimer

The following information is presented for illustrative purposes only and contains numerous assumptions that may or may not occur. Investors should perform their own assessment, and are cautioned that milestones mentioned below may or may not be achieved, and that other milestones and/or material events not named here could occur to alter the valuation and outcome. Investors should make their own assessment and determination on valuation and potential return, with the information below only as a guide. A full summary of several potential scenarios has been provided in the appendix.

Exit Analysis Assumptions:
PAVC analyzed some theoretical exit scenarios with support of some key assumptions. The exit analysis below assumes:

• Current $41M Series B with a $130M pre-money valuation.
• A $150M Series C in new money with an assumed pre-money valuation of $750M.
  
  • Timing: Q4 2026
• A $500M Series D in new money with an assumed pre-money valuation of $2B.
  
  • Timing: Q4 2028
• The model does not account for potential Plum Alley Ventures Company investment in the Series C or Series D.

The assumptions used to support the scale of each exit included:

• Company-Provided Financial Projections: Revenue projections provided by the Company were discounted to account for potential lags in growth and penetration, and used for upside projections. 
• Company-Provided Product Development Projections: The Company’s revenue is in part tied to further margin improvements with additional high-value product development. Projections were discounted to account for potential lags in commercialization and market penetration.
• Customer Penetration: These projections were discounted to assess downside risk, and provide context for scale on the upside.
• Customer Pipeline: Company-provided customer pipeline was projected by Plum Alley to assess future capital raises and exit scenarios.

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Considerations & Risks

Phoenix Tailings provides an opportunity to capitalize on the macro-environmental trend of increased usage of rare earth metals (REMs), as they are essential components for technology-enabled societies today. Demand for REMs from governments, businesses, and consumers alike has steadily grown as more advanced technologies continue to expand across industries. This surge in demand is driven by the widespread adoption of electric vehicles, renewable energy infrastructure, and cutting-edge electronics, alongside national initiatives focused on reducing dependency on foreign supply chains. As technological innovations such as artificial intelligence, quantum computing, and 5G networks proliferate, the reliance on REMs is set to increase even further. Phoenix Tailings stands at the forefront of this trend, offering a unique investment opportunity to tap into the growing need for sustainable, domestic sources of these critical materials, while also addressing the pressing challenge of environmental responsibility in the extraction process.

Considerations with this opportunity include both market and business associated risks, which are:

• Supply Chain Vulnerabilities: While a wholly U.S.-based supply chain reduces dependence on foreign sources, domestic critical metal reserves, particularly for rare earth metals (REMs), are limited and refining capacity is still underdeveloped. In particular, the U.S. domestic supply chain infrastructure surrounding REM refining and processing is undeveloped in comparison to global competition. As such, this gap in infrastructure could lead to bottlenecks or delays, significantly impacting production. Any disruptions in mining, processing, or transportation could impact operations and profitability. 
• Regulatory and Environmental Policy Risks: Critical metal extraction and refining processes are highly regulated due to their environmental impact, including water usage, chemical waste, and emissions. Stricter U.S. environmental policies or unexpected regulatory changes could increase compliance costs, delay projects, or limit operational scalability. Furthermore, as bot
• High Capital Intensity and Long Lead Times: Establishing and scaling critical metal refining and manufacturing facilities requires significant up-front capital investment and time. Delays in project timelines, cost overruns, or failure to meet efficiency targets can reduce return on investment (ROI) and erode competitiveness.
• Technological Disruption and New Materials: Rapid advancements in materials science may lead to the development of alternative materials that could replace or reduce the demand for specific critical metals. For example, research into solid-state batteries or alternative magnet technologies could decrease demand for lithium, cobalt, or neodymium-based products.
• Competition and Market Dynamics: The global rare earth and critical metals market is dominated by China, which controls over 70% of global refining capacity. U.S.-based companies may face difficulty competing on price and scale, especially as China can influence global supply and pricing. Additionally, emerging competitors from other countries aiming to develop their domestic supply chains could increase pressure on U.S. producers.
• Government Incentives and Policy Shifts: U.S. government incentives, such as tax credits, subsidies, and grants, have been crucial to promoting domestic critical metals production. However, changes in political priorities, policy shifts, and stipulations in government funding could reduce financial support, impacting long-term viability and growth.
• Geopolitical and Trade Risks: As critical metals play a key role in national security and clean energy transitions, geopolitical tensions or trade restrictions could influence market dynamics, creating volatility in supply chains and pricing. 
• End-User Market Dependence: Demand for critical metals is closely tied to industries such as electric vehicles, renewable energy, and data centers. Any slowdown or shift in these sectors could reduce demand, impacting revenue and growth prospects.