Aalo Atomics raises $100 million to build factory-made nuclear reactors for AI data centers

Aalo Atomics, an Austin-based startup, has secured $100 million in Series B funding to advance its mission of powering AI data centers with small, factory-built nuclear reactors. The round was led by Valor Equity Partners, with participation from Harpoon Ventures and Alumni Ventures, bringing the company’s total funding to over $136 million. Founded in 2023 by CEO Matt Loszak and CTO Yasir Arafat, Aalo is developing the Aalo Pod—a small modular reactor designed to be mass-produced and deployed near data centers. One Pod can generate enough electricity to power approximately 50,000 homes or a single large data center. The company’s vision is to solve the growing energy demands of AI by bringing reliable, low-carbon nuclear power directly to the sites where it’s needed. The investment comes at a pivotal moment. As AI workloads surge, so do energy needs, prompting tech giants and startups alike to seek sustainable and scalable power solutions. Aalo’s approach stands out by focusing on manufacturing reactors offsite, shipping them to locations, and assembling them quickly—reducing construction timelines and costs compared to traditional nuclear plants. In August, the U.S. Department of Energy selected Aalo to test its experimental Aalo-X reactor at Idaho National Laboratory under the Nuclear Reactor Pilot Program. The project, backed by the Trump administration, aims to accelerate the development and deployment of advanced nuclear technologies beyond government labs. Aalo plans to complete construction of Aalo-X by 2026. Aalo is not alone in this space. Ten other nuclear startups, including Oklo—backed by Sam Altman—Antares Nuclear, Radiant Industries, and Valar Atomics, have also been chosen for the DOE initiative, signaling strong government and private sector interest in next-generation nuclear energy. Loszak, who previously cofounded Humi, an HR tech company acquired for over $100 million, says the rise of AI was a key driver in launching Aalo. “When we started, data centers were high on our list. Very quickly, we realized we had to focus the entire company around this,” he said. The startup now aims to partner with hyperscalers willing to pay a premium for fast, clean energy, though specific clients have not been disclosed. The company plans to double its workforce from around 60 to 120 employees within a year, hiring primarily engineers and manufacturing experts. The new funding will also support scaling production at its 40,000-square-foot Austin factory. Loszak’s passion for nuclear energy is personal. Growing up in Canada, he suffered from asthma linked to coal plant pollution. After the country expanded nuclear power, air quality improved and his symptoms vanished. “I thought, ‘my God, this technology is incredible,’” he said. Arafat, the CTO, brings deep nuclear expertise, having worked at Westinghouse and on the MARVEL reactor project at Idaho National Lab, and holds a Ph.D. in nuclear engineering from North Carolina State University. Aalo’s long-term goal is to bring the cost of electricity down to about three cents per kilowatt-hour—well below the national average of 13 cents as of May 2025. While current prices are higher, the company believes economies of scale and mass production will drive costs down over time. With growing support from investors like Valor Equity Partners—known for backing major AI infrastructure plays, including xAI and Crusoe—Aalo is positioning itself at the intersection of energy innovation and the AI revolution.