A nuclear energy startup that barely existed three years ago is now seeking a much higher valuation.
Valar Atomics, based in El Segundo, California, is negotiating a new funding round that would value the company at about $6 billion. That is up from a $2 billion valuation from its previous raise. The company is trying to raise $1 billion in fresh equity, with venture capital firm Sequoia Capital expected to lead the deal. Sequoia declined to comment on the talks.
The company manufactures compact, prefabricated power stations known as small modular nuclear reactors, designed to be more economical and quicker to deploy than traditional reactors.
There is a broader demand crunch driving interest in this space.
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Forecasts indicate that demand for power from data centers will rise rapidly in the coming years, and numerous local utilities remain far from installing sufficient additional capacity. This supply shortfall has transformed nuclear energy - historically hindered by budget overruns and bureaucratic hurdles - into a sector that is now receiving intense attention within the AI infrastructure market.
Valar is not alone in chasing this opportunity. Rivals such as Kairos Power and Bill Gates-backed TerraPower are developing advanced reactors intended for technology and industrial clients, along with NuScale Power, the only small modular reactor developer with U.S. regulatory design approval.
Valar recently showed that its small reactor produced a small amount of electricity to power an Nvidia AI processor. Around the time of that test, the two companies announced a partnership to study how nuclear power could supply future AI data centers.
Isaiah Taylor founded Valar Atomics. He is 27 years old. He left high school at the age of 16. Taylor launched two startups before Valar, and he has mentioned that his great-grandfather was a nuclear physicist involved in the Manhattan Project.
Among Valar's backers are Palmer Luckey, who founded Anduril, and Shyam Sankar, Palantir's CTO.
In a separate matter, Valar has adopted a confrontational legal approach against its regulator. In 2023, the company allied with multiple states and competing startups to file a lawsuit against the Nuclear Regulatory Commission. Valar argued in the suit that the regulator "improperly subjects small test reactors to the same protracted licensing procedure as larger commercial facilities," a company spokesperson said. The legal dispute remains unresolved; both parties have repeatedly halted court proceedings, indicating that a potential settlement may be under negotiation.
The broader context for Valar's rise is a surge in venture interest in advanced nuclear technology. With AI data centers projected to consume massive amounts of electricity, startups like Valar are racing to deliver carbon-free power that can be sited nearer to customers than traditional plants. The company's young founder, who dropped out of high school to start companies, has also courted controversy by challenging the NRC's framework, a move that has drawn both support and criticism from industry insiders.
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