The startup Sortera Technologies has raised fresh funding to expand its tech-driven recycling operations — with an eye toward meeting rising U.S. demand for low-carbon aluminum.
Sortera uses advanced sensors and artificial intelligence to sort different types of aluminum found in old car parts and appliances. On Thursday, the company said it raised $45 million to fuel its next phase of growth, including from global investment firm T. Rowe Price Associates, venture capital fund VXI Capital, and Yamaha Motor Ventures, an arm of the Japanese manufacturer.
Sortera’s flagship facility in Markle, Indiana, currently processes about 100 million pounds of shredded metal per year to recover specific alloys — blends of aluminum that contain other elements to make them stronger and more durable. With the new investment, the startup plans to build a second plant next year, in Lebanon, Tennessee, to double its capacity to pick through gleaming scrap heaps.
The expansion comes as the United States is racing to shore up supplies of aluminum.
Part of that is driven by the Trump administration’s increased tariffs on imports of aluminum and steel, which have put pressure on U.S. manufacturers to produce more metal. Automakers are also using more lightweight aluminum instead of steel, including in battery-powered cars and hulking Ford F-150 pickup trucks. Data-center developers need more of the metal for their buildings and the technology inside, while some buyers are looking specifically for lower-carbon aluminum to meet decarbonization goals.
The U.S. is now playing catch-up. America’s production of new, primary aluminum has declined significantly in recent decades, and while plans are underway to build two new smelters, neither is expected to be fully on line this decade. Both projects will also need to secure huge amounts of cheap — and ideally clean — electricity at a time when that’s hard to come by.
Recycling aluminum, on the other hand, requires only about 5% of the energy that’s needed to produce the metal in power-hungry smelters. As a result, it’s generally a faster, cheaper, and lower-carbon way of making aluminum products.
“The domestic market is hungry for sustainable, high-quality recycled aluminum,” said Michael Siemer, Sortera’s CEO.
The country’s use of scrap will climb even higher once two new rolling facilities — which shape aluminum into plates, sheets, and coils — ramp up production. Steel Dynamics rolled its first hot coils at a $1.9 billion plant in Mississippi this summer. Novelis, which is partnering with Sortera to use the startup’s rescued aluminum, is slated to bring its $2.5 billion facility on line in Alabama later next year.
“For them to be green, they each are going to need an additional billion pounds of scrap aluminum,” Siemer estimated.
Despite the growing domestic appetite for aluminum, much of what the country recycles still gets exported overseas, particularly when it’s lumped together with other metals like copper, brass, and titanium. MAGNETs can easily pull out pieces of steel from scrap piles, but aluminum alloys are tricky to sort. That leaves behind roughly 18 billion pounds of mixed-metal material per year, about 10 billion of which include aluminum alloys, according to Sortera.
“We generally scoop it up, put it into ships, and send it to Southeast Asia,” where the metals are sorted by hand, Siemer said of the industry’s approach. “Or it’s made into low-value products in America, where you can melt the aluminum down” with the other metals, he added, likening the process to melting a box of colorful crayons into a functional, but less desirable, brown soup.
Sortera’s founders, Nalin Kumar and Manual Garcia, launched the company in 2020 to introduce more precision and automation to this sorting process. After spinning out of an Advanced Research Projects Agency–Energy program that focused on recycling metals for lightweight vehicles and aircraft, the startup raised money from firms including Chrysalix Venture Capital and the Bill Gates–affiliated Breakthrough Energy Ventures. Sortera said the funding announced this week brings its total investment to about $120 million.
Other early-stage companies are working on new ways to pluck recyclable materials out of the gobsmacking amounts of garbage we generate every day. Greyparrot, for example, has developed AI camera systems that recycling firms can install to track aluminum cans, glass bottles, and plastic packaging as they move down conveyor belts. The startup Amp uses software-driven robotic systems inside its own plants to automatically sort materials.
But Sortera handles only scrap metal, and it hunts for only specific types of high-quality aluminum alloys — ones that manufacturers like Novelis are typically willing to pay more for. The company’s Indiana facility can also process scrap at high enough volumes to justify handling it domestically, Siemer said.
“They’re getting into a really interesting niche,” said Parker Bovée, who leads waste and recycling research for the consulting firm Cleantech Group. “If you can get pure sorted alloys, then you know exactly what you’re dealing with,” which makes the metal more valuable to the companies turning it back into car frames, engine blocks, or complex metal parts.
Bovée said that from an investment standpoint, he considers Sortera’s approach to be higher risk than a software-only solution, since it involves spending more capital to build facilities and machinery. Waste management in general “is a difficult industry to break into and make substantial inroads,” he said. But Sortera’s ability to capture sought-after alloys “makes them very impressive.”
Siemer added that Sortera will eventually use its technology to sort the other metals found in shredded scrap piles. But for now, he said, “We’re building a business on the aluminum.”
