Rocket Lab backer Outset raises $25M to fund New Zealand’s deep tech moonshots

Summary

New Zealand’s deep tech ambitions just got a $25 million boost. Outset Ventures, the Auckland-based venture firm and incubator that spun out unicorns like Rocket Lab and LanzaTech, has closed its second fund at an oversubscribed $41.5 million NZD. The fund’s mission is to back startups working on hard science and engineering breakthroughs – technologies its partners believe New Zealand is uniquely suited to lead. That includes everything from aerospace to medical technology, though Outset is especially focused on energy generation and storage. The firm is betting that New Zealand, while too small to play on the frontlines of AI, can tackle the downstream energy and infrastructure problems that AI is already starting to strain. “We know that the biggest constraint for AI growth all comes down to who can get the most installed energy the fastest, and so that’s where we’ve ended up concentrating more of our attention,” Angus Blair, partner at Outset, told TechCrunch. Many of the startups in Outset’s cohort focus on delivering cheaper, cleaner ways to generate and store energy, recycle heat waste, and address infrastructure bottlenecks that AI is already straining, per Blair. One emerging Kiwi leader has been OpenStar, a nuclear fusion startup that’s working on levitated dipole reactors, and is one of the few from Outset’s Fund I cohort to also receive funding from Fund II. The firm reached an important milestone last November when it created superheated plasma at temperatures of around 540,000 degrees Fahrenheit – an important step towards producing fusion energy, and one that took only around $10 million to get there as compared to many decades-long government-led initiatives in the fusion space. Then there’s EnergyBank, which is building long duration energy storage for floated offshore wind that’s best suited for deeper waters. Blair said the firm’s solution is a perfect complement to the many plans to install more floating offshore wind farms in regions like the No...