The Fusion Report
The Fusion Report

The Q1 2025 Fusion Funding Update: On Pace for $3B+ in Funding for 2025

by | Apr 1, 2025

If you have been following the news over the past few weeks, it is hard not to notice that US economic expectations for 2025 are not particularly positive. Overall, US economic growth is expected to slow to 2.2% in 2025, driven by Trump Administration tariffs and government restructuring/downsizing. Moreover, growth is expected to slow even more in 2026, reaching only 1.3% in the US. Reflecting this, the US500 stock market index has decreased by 193 points (3.29%) since the start of the year, primarily over concerns from US tariffs. Similarly, consumer confidence declined by 7.0 points to 98.3, according to the Conference Board.

Luckily, the investment picture for the venture capital (VC) and private equity (PE) sectors looks considerably better than the broader US economic picture. After what was a pretty abysmal year in 2024 for VCs, expectations for 2025 are an increase in investment funds from $301.78B to $364.19B, producing a CAGR of 20.7%. Primary areas of interest for most VCs in 2025 include artificial intelligence (AI), healthcare/biotechnology, and (in spite of the Trump Administration) green tech/clean energy. Similarly, expectations are that the PE sector will start to recover from 2024 as well. Driven by limited partner (LP) demands for liquidity and LOTS of dry powder (uninvested funds), the PE sector’s investments are also expected to grow in 2025.

So how has the fusion energy sector done in 2025? In Q1, the total funding for fusion energy in the US and Europe (including government awards) is roughly $1.16 billion, with $562M in private investments, with another $156 million from the US Department of Energy (DoE) and £410 million ($450 million) from the UK Atomic Energy Agency (UKAEA). The largest fusion energy investments outside of China in Q1 2025 include:

  • Helion Energy: Helion’s $425 million Q1 2025 Series F raise, including new investors Lightspeed Venture Partners, SoftBank Vision, and an unnamed university endowment fund, along with existing investors, values Helion at $5.425 billion (post-money), and increases their total capital raised to over $1B.
  • Marvel Fusion: Marvel raised a Series B fund in Q1 2025 of 53 million euros (roughly $54M US), increasing their total raise to 113 million euros ($122M US). New investors included EQT Ventures, Siemens Energy Ventures, and the European Innovation Council (EIC) Fund, with contributions from existing investors Tengelmann Ventures and Bayern Kapital.
  • Renaissance Fusion: Renaissance (a French company) raised a Series A1 round of 32 million Euros ($34.6M). The round was led by Credit Mutuel Impact’s Revolution Environmentale et Solidaire fund, and Lowercarbon Capital.
  • US Department of Energy (DoE) Fusion Investments: The US DoE awarded $107 million for a number of projects through its Fusion Innovative Research Engine (FIRE) collaboratives fund. It also awarded another $49 million for 19 specific projects targeting materials and other research.
  • UK Atomic Energy Agency (UKAEA) Investment: In January, the UKAEA pledged £410 million ($500 million) to build a fusion power plant in Nottingham as part of its Spherical Tokamak for Energy Production (STEP) program. The money is to be utilized in 2025 and 2026, and includes funding for education and training programs to advance the UK fusion energy sector.

Even if the government funds are not included, the private funding alone is roughly 2/3 of the $900M invested in the entirety of 2024, according to the Fusion Industry Association (FIA). And this doesn’t include fusion investments in China, where the Beijing government alone is believed to be investing $1.5 billion annually in fusion (though funding is generally not disclosed by the Chinese government). In 2025, The Fusion Report forecasts that the total new worldwide investment in fusion energy in 2025 (excluding China) is expected to top $3 billion, significantly higher than in 2024.

Lastly, as the leading companies such as Commonwealth Fusion Systems (CFS; total funds raised of $2 billion), TAE (total funds raised of $1.2 billion), Helion (total funds raised of $1 billion), and Pacific Fusion (total funds raised of $900 million) start to hit critical milestones in the fusion energy development, it can be expected that interest in investing in fusion energy late-stage funding rounds. It is also likely that fusion energy supply chain companies will also be able to start raising new capital to meet the needs of the leading fusion companies for material such as HTS tape, pulsed power systems, cryogenic infrastructure, and other critical fusion systems. Overall, 2025 should be a great year for fusion energy!