Aalo Atomics, an Austin-based nuclear energy startup, has secured a monumental $100 million in Series B funding to accelerate its mission of powering data centers with innovative small modular reactors (SMRs). Led by Valor Equity Partners and supported by investors like Harpoon Ventures and Alumni Ventures, this funding round, announced on August 19, 2025, brings Aalo’s total capital to over $136 million. The company aims to address the surging energy demands of artificial intelligence (AI) and hyperscale data centers by deploying its Aalo Pod, a 50-megawatt (MW) “extra modular reactor” (XMR) designed for scalability, efficiency, and sustainability. With a prototype reactor, Aalo-X, slated for operation in summer 2026 at Idaho National Laboratory (INL), Aalo Atomics is poised to redefine clean energy for the tech industry.
Why This Matters
The rapid growth of AI and cloud computing has created an unprecedented demand for energy, with data centers projected to consume up to 8% of U.S. electricity by 2030. Traditional energy sources, such as fossil fuels and intermittent renewables, struggle to provide the consistent, high-density power required. Aalo’s microreactor technology offers a clean, reliable, and scalable solution, aligning with the tech industry’s push for carbon-free energy. This funding positions Aalo as a frontrunner in the race to power the AI revolution sustainably.
The Aalo Pod: A Game-Changer for Data Centers
What is the Aalo Pod?
The Aalo Pod is Aalo Atomics’ flagship product, a modular nuclear power plant designed specifically for data centers. Each pod consists of five Aalo-1 reactors, each producing 10 MW of electricity, for a total of 50 MW per pod. Unlike traditional nuclear plants, the Aalo Pod is:
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Fully modular: Both the reactors and the plant are factory-built, shipped in standard containers, and assembled on-site, reducing construction time and costs.
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Water-free cooling: Utilizing a sodium-cooled reactor design, it eliminates the need for water, enabling flexible siting near data centers.
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Scalable: Pods can be combined to deliver gigawatt-scale power, meeting the needs of hyperscale facilities.
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High availability: An N+1 configuration ensures continuous operation even if one reactor requires maintenance.
The Aalo-1 reactor, inspired by the Department of Energy’s MARVEL microreactor, uses uranium zirconium hydride fuel with a strong negative temperature coefficient for inherent safety. This design allows the reactor to self-regulate, shutting down automatically in extreme conditions without complex engineered systems.
Economic and Environmental Impact
Aalo aims to deliver electricity at a competitive 3 cents per kilowatt-hour (kWh), undercutting the U.S. average of 13 cents/kWh (as of May 2025) and rivaling natural gas and solar farms. By providing clean, baseload power, Aalo’s reactors reduce reliance on fossil fuels, addressing both environmental concerns and the tech industry’s carbon-neutral goals. The company’s focus on mass manufacturing in its 40,000-square-foot Austin factory further drives down costs through economies of scale.
Strategic Partnerships and Milestones
Collaboration with Idaho National Laboratory
Aalo Atomics is leveraging a strategic partnership with INL to build and test its Aalo-X experimental reactor at a tentative site identified by the U.S. Department of Energy (DOE) in December 2024. The Aalo-X, set to go critical in 2027, will serve as a proving ground for the company’s sodium-cooled microreactor technology, validating safety, fuel performance, and coolant efficiency. This project is part of the DOE’s Nuclear Reactor Pilot Program, initiated under a May 2025 Executive Order to streamline nuclear reactor testing.
DOE and Industry Support
Aalo’s technology builds on the DOE’s MARVEL microreactor program, with its CTO, Yasir Arafat, having led MARVEL’s design. The company also received a GAIN Voucher from the DOE to support performance data collection and licensing activities. Additionally, Aalo’s selection for the DOE’s initiative alongside competitors like Oklo and Radiant Industries underscores its credibility in the advanced nuclear sector.
Non-Nuclear Prototype and Manufacturing
In April 2025, Aalo unveiled a non-nuclear prototype of its Aalo-1 reactor at its Austin facility, marking a significant step toward commercial viability. The company plans to scale production, doubling its workforce from 60 to 120 employees within a year, focusing on hiring engineers and manufacturing talent. By 2030, Aalo aims to deploy its first commercial pod, with plans to produce thousands of Aalo Pods globally.
Challenges and Opportunities
Regulatory and Competitive Landscape
The nuclear industry is notorious for long timelines and regulatory hurdles. Aalo’s aggressive 2026 timeline for Aalo-X bucks this trend, but securing Nuclear Regulatory Commission (NRC) approval remains a challenge. The company’s Regulatory Engagement Plan, submitted in July 2024, outlines safety and environmental standards for its 100-MWe units. Competition from other nuclear startups like Oklo, NuScale, and Kairos Power, which recently secured a deal with Google, intensifies the race to power AI data centers.
Addressing Public Perception
Nuclear power faces public skepticism due to safety concerns. Aalo counters this with its passive safety features and modular design, which minimize risks. CEO Matt Loszak, who developed asthma from coal-plant smog, emphasizes nuclear’s potential as a clean energy “underdog.” By co-locating reactors with data centers, Aalo reduces transmission losses and enhances efficiency, appealing to tech giants like Google, Microsoft, and Amazon.
The Bigger Picture: Nuclear Power and AI
The convergence of nuclear energy and AI is reshaping the energy landscape. Big Tech’s growing energy demands, driven by AI training and inference workloads, have sparked interest in nuclear solutions. Aalo’s competitors, such as Oklo with its Aurora microreactor and Kairos Power with its Google-backed deal, highlight the industry’s momentum. Aalo’s focus on modularity, speed, and cost-competitiveness positions it to capture a significant share of this market, potentially ushering in a “Second Atomic Age.”
Aalo Atomics’ $100 million Series B funding is a pivotal step toward realizing its vision of powering AI-driven data centers with clean, scalable nuclear energy. By combining innovative Aalo Pod technology, strategic partnerships with INL and the DOE, and a focus on mass manufacturing, Aalo is addressing the tech industry’s energy crisis head-on. While challenges like regulatory approval and public perception remain, Aalo’s ambitious timeline and cost-effective approach make it a leader in the nuclear renaissance. As AI continues to drive energy demand, Aalo Atomics is poised to light the way for a sustainable future.
