Nesta Impact Investments backs tech ventures working in areas aligned with Nesta’s 2030 impact goals. Nesta’s sustainable future mission aims to reduce UK household carbon emissions by 28%, from 2019 levels, by 2030. We invest in businesses that support the green transition and Nesta’s mission. Nesta is delighted to support Anaphite’s recent £10.4 million Series A round, alongside World Fund, Maniv, EEI, and existing investors, including Elbow Beach Capital.

Anaphite is a chemistry company developing new processes for the dry coating of lithium-ion battery electrodes. Their technology produces fully formulated Dry Coating Precursor (DCP®) powders, ready for dry coating and can help replace the existing energy intensive and environmentally damaging electrode wet coating process in battery manufacturing.

Anaphite has two routes to impact. Firstly, reducing the cost of battery production, which is critical to speeding up the green transition. Secondly, reducing the emissions created by making the batteries themselves (embodied carbon). Anaphite targets the battery production market – which is the biggest source of embedded emissions for electric cars, accounting for between 40%–60% of total production emissions.

Battery production currently involves a process of electrode wet coating that is energy intensive, complex and costly. Anaphite’s novel chemical compositing process enables the production of high-performance batteries via a more efficient and lower energy process. Not only that, but it also reduces the manufacturing cost involved in producing batteries, which has the potential to increase the rate and pace of adoption of electric vehicles and stationery storage applications. As these lower production costs are passed through to consumers, it would make the path to household decarbonisation easier and cheaper.

The initial target customer will be electric vehicle (EV) owners, indirectly reached through automotive companies. Anaphite is working with battery cell manufacturers and automotive companies to scale up its technology application. In 2023, there were 14 million EVs sold worldwide, this is forecast to reach 17 million in 2024. There are currently over 40 million EVs in use globally. The EV market is projected to grow at a compound annual growth rate (CAGR) of approximately 13.7% from 2024 to 2030​.

While Anaphite's initial commercial interest and focus is the electric vehicle market, Original Equipment Manufacturers (OEMs) and battery cell manufacturers, its technology can be applied to all battery cell manufacturing processes. All batteries require cathode and anode coating, meaning this cost curve reducing technology will also be applicable to batteries used in residential storage and grid balancing storage applications – which will lead to cheaper storage offerings for businesses and households, accelerating adoption.