Munich-based startup Phlair has raised €14.5M in seed funding to advance its hydrolyzer-based Direct Air Capture (DAC) technology. The round was led by Extantia Capital, with participation from Planet A and Verve Ventures. Phlair also received a grant from the EIC accelerator and capital from existing investors – Atlantic Labs, Counteract, and UnternehmerTUM Funding for Innovators.
Phlair aims to challenge industry leaders Climeworks, Carbon Engineering, and Heirloom with its system designed for mass manufacturing and compatibility with intermittent renewable energy grids. The company’s goal is to drive down DAC costs to below $100 per ton of CO₂ captured.
How will it use the funding?
The company plans to use the investment to bring its first-of-a-kind Direct Air Capture plants online in 2025, delivering to a roster of early customers such as Shopify, Stripe, Klarna, and Deep Sky. In a conversation with TFN, Malte Feucht, founder and CEO of Phlair, shared: “The round also lays the foundation for our first large >20,000 t-CO2/year commercial plant, Dawn, scheduled to come online in 2026.”
The company has already built a working ton-scale demonstrator of its technology and has experienced significant commercial traction only 18 months after inception in 2022. The raise will accelerate the development of two 260 t-CO2/year FOAK plants, Electra 01 and Electra 02.
Behind its technological edge
Founded in 2022 by Malte Feucht, Paul Teufel, and Steffen Garbe, Phlair addresses significant industry challenges, including high costs, limited scalability, and incompatibility with renewable energy sources. Key advantages of Phlair’s approach include using off-the-shelf components for rapid scalability, a pH-swing mechanism powered solely by electricity, built-in energy storage (that eliminates) the need for expensive battery systems, and a focus on manufacturability and cost reduction.
Speaking specifically about the technology, Phlair’s system is inspired by alkaline water electrolysis and proton exchange membrane (PEM) fuel cell technology, allowing for efficient CO₂ capture and release. The captured CO₂ can be used for permanent storage or manufacturing CO₂-negative chemicals.
Speaking to TFN, Malte Feucht emphasised: “Our DAC system is purposefully designed for mass manufacturing. Combining our manufacturability with rapid execution, we are able to start addressing the world’s urgent need for scalable DAC solutions and deliver meaningful volumes. All of this while driving costs down toward our long-term goal of sub $100/tCO2, putting us in a great position to lead this industry.”
Investors view
Torben Schreiter, Partner at Extantia Capital, expressed confidence in Phlair’s potential: “Scaling DAC while aggressively driving down costs is no small feat. We are convinced Phlair is uniquely positioned to lead the third wave of DAC companies (DAC 3.0), as they emphasise not just price but also manufacturability. The team is outstanding, and we are impressed by their speed of execution.”
What do we think about this investment?
Phlair’s innovative approach to Direct Air Capture technology, coupled with its focus on scalability and cost reduction, positions the company as a promising player in the growing carbon removal industry. As global efforts to combat climate change intensify, Phlair’s advancements could make large-scale carbon capture more accessible and economically viable.
