Vale SA, the world’s No. 2 iron ore producer and one of the biggest nickel suppliers, has created a corporate venture capital arm to back startups focused on developing game-changing innovations for mining and metals challenges.
Vale Ventures is starting with a $100 million budget to invest in firms involved in sustainable mining initiatives. The unit seeks to provide initial funding and early-stage investments in startups worldwide, with a goal of holding 3% to 5% stakes in the firms.
“We’ll be part of a pool of investors working for the success of these startups,” Vale Ventures head Viktor Moszkowicz said in an interview.
Vale’s outlay will be enough to build an initial portfolio of investments in about five years, generating financial and strategic return, he said. The first in Vale’s portfolio is Boston Metal, a firm focused on steel decarbonization technology that has the backing of cleantech venture capital funds, mining companies and steel users. Vale invested $6 million in the US company in February 2021.
Vale’s venture capital push follows similar initiatives pursued by rivals including BHP Group Ltd. and Rio Tinto Group. The Brazilian mining giant looks to gain access to business opportunities and innovative technologies with the potential to be used in its operations amid a push to meet its environmental targets.
The Rio de Janeiro-based company has four main themes that drive Vale Ventures portfolio selection: decarbonization, zero-waste mining, technology that changes mining operations, and energy transition metals.
The last theme aims to boost the supply and demand of key metals needed to support the shift from fossil fuels to less polluting energy. Startups that are developing batteries that use metals produced by Vale are on the radar as is technology that creates “urban mines”—places where discarded metals can be recycled, Moszkowicz said.
(By Mariana Durao)