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First Mode CEO Julian Soles speaks at the February opening of a Seattle factory. (First Mode Photo)
First Mode, a Seattle-based clean tech company aiming to reduce carbon emissions for mining trucks and other heavyweight vehicles, is in asset acquisition talks after a decision by its majority shareholder to stop funding the business.
Anglo American, a global mining company which took ownership of First Mode last year in a $1.5 billion transaction, recently halted funding to First Mode, according to a First Mode spokesperson.
“As a result, First Mode engaged financial advisors to support the process of evaluating strategic alternatives, including the potential sale of the business to a new owner who could continue to support First Mode’s world-leading decarbonization innovations,” the company said in a statement to GeekWire.
But First Mode was unable to reach an agreement for its entire business and is now engaged in talks with a bidder “who has expressed an interest in a significant part of the technology and team,” according to the company’s statement.
The company did not disclose the identity of the bidder, details of the agreement, or impact to its workforce.
It’s the latest chapter in a roller coaster past few years for First Mode.
When Anglo American acquired a majority share of First Mode a year ago, the business plan focused on converting heavy trucks to use First Mode’s zero-emission, hydrogen fuel-cell powertrain — starting with Anglo American’s fleet.
But in January, First Mode said that it would put less emphasis on hydrogen-battery powertrains and more emphasis on hybrid diesel-battery powertrains. At the time, First Mode CEO Julian Soles said the change in strategy provided a lower-cost, step-by-step path to reducing carbon emissions.
It also announced a workforce reduction in January of about 20% of its U.S.-based workforce.
The company then held a ribbon-cutting ceremony in February for a new 40,000 square-foot factory in Seattle to build powertrain conversion kits for mining trucks. Washington Gov. Jay Inslee and Albert Gore, executive director of the Zero Emission Transportation Association, were among the guests.
But then in August the company trimmed its workforce again.
The company’s cutbacks reflect a realization that the transition to hydrogen power is likely to take longer than previously expected, at least for heavy industry — and that in the meantime, less expensive hybrid options may be needed to address the climate challenge.
First Mode created the hydrogen-fueled hybrid powerplant for Anglo American’s nuGen mining truck, which made its debut in South Africa in 2022 as the world’s largest zero-emission vehicle.
The $1.5 billion deal with Anglo American, announced in 2023, included a $200 million investment in First Mode.
Later that year, Anglo American said it planned to reduce expenses by $1.8 billion by 2026.
First Mode started out in 2018 as an employee-owned engineering venture, formed by veterans of an asteroid mining venture called Planetary Resources. First Mode initially focused on providing expertise for space projects such as NASA’s Perseverance rover mission and the Psyche mission to a metal-rich asteroid. But in 2019, the company began building an increasingly close relationship with Anglo American.
First Mode operates other offices around the world, including a proving ground for zero-emission trucks and associated infrastructure in Centralia, Wash.
The company is based in Seattle, but its leadership team and administrative center is in London, where Anglo American is headquartered.
Soles, a former Anglo American exec, took over in January 2023. The company was previously led by co-founder Chris Voorhees, who transitioned to a chief product and technology officer role. He left in September 2023 and now runs a Seattle-based engineering firm called Sol Zero.
