Japan startup Sustech's valuation jumps over $800 mln in latest funding round

Sumitomo Mitsui Trust

25/10/2024 03:00

By Makiko Yamazaki
       TOKYO, Oct 25 (Reuters) - Japan's Sustech is set to
raise $50 million from investors, valuing the energy tech
startup at more than $800 million, people with knowledge of the
matter said, as the Tokyo-based firm looks to tap fast-growing
demand for cleaner energy worldwide.
    The valuation of 124 billion yen ($816 million) for Sustech
in its fourth round of fund-raising marks a 3.5-fold jump from
the 35 billion yen valuation last year, the sources said,
bringing it closer to joining fewer than a dozen Japanese
unicorns worth over $1 billion.
    The sources declined to be identified as the matter is
private.
    The surge in valuation is being driven by robust global
appetite for investment in clean energy technology and
infrastructure, which the International Energy Agency estimates
would hit $2 trillion this year - twice the amount going into
fossil fuels.
    Founded in 2021, Sustech builds renewable power plants to
help reduce clients' carbon footprint and develops artificial
intelligence (AI)-based systems for predicting power generation
and maximising profits from power sales in the wholesale market.
    The latest funding round was led by ceramics maker NGK
Insulators  5333.T , which is already in partnership with
Sustech in the energy storage plant business, according to the
sources.
    The capital raised will help fund the construction of
renewable energy plants and development of AI to improve power
grid stability, which is increasingly crucial as more wind and
solar resources are added to the power grid, the sources said.
    Sumitomo Mitsui Trust Group  8309.T  as well as former
SoftBank Group  9984.T  chief strategy officer and startup
investor Katsunori Sago are among some of the 30 investors in
Sustech. The firm is aiming to make a Nasdaq market debut by
early 2028, the sources said.
    The company has launched a 150 billion yen fund with
property developer Tokyu Land and a 20 billion yen fund with
transport operator Ryobi Holdings to build renewable power
plants.

($1 = 151.9300 yen)

 (Reporting by Makiko Yamazaki; Additional reporting by Leika
Kihara
Editing by Shri Navaratnam)
 ((Makiko.Yamazaki@thomsonreuters.com;))