Nuclear Startups Are Seeing an Increase, Driven by Smaller Reactors, While Facing Significant Challenges.

The nuclear industry is experiencing a significant resurgence, fueled by the refurbishment of older plants and substantial investment in new nuclear startups. Over the past several weeks in 2025 alone, these startups secured $1.1 billion in investment, driven largely by optimistic projections regarding the potential success of smaller nuclear reactors. Traditional nuclear power generation relies on massive infrastructure – facilities like the Vogtle 3 and 4 reactors in Georgia contain tens of thousands of tons of concrete, utilize 14-foot-tall fuel assemblies, and generate more than 1 gigawatt of electricity. However, projects of this scale have frequently encountered delays and cost overruns, often eight years beyond initial timelines and exceeding budgets by considerable amounts.

A new wave of nuclear startups is attempting to circumvent these challenges by developing smaller reactors. The underlying strategy centers on producing multiple reactors concurrently, leveraging mass production techniques to reduce costs as production volumes increase. The extent to which this approach will deliver tangible savings is currently being investigated, but startups are banking on a positive outcome.

However, realizing this benefit presents considerable hurdles. As illustrated by Tesla’s experience with the Model 3, achieving profitable large-scale production is exceptionally difficult, particularly for industries where U.S. expertise is not dominant. U.S. nuclear startups face a distinct disadvantage in this regard. “I have a number of friends who work in supply chains for the nuclear industry, and they can identify approximately five to ten materials that are not produced domestically,” stated Milo Werner, a general partner at DCVC. “We are reliant on imports, and we have essentially lost the manufacturing capabilities for these crucial components.”

Werner, a seasoned manufacturing professional, brings extensive experience to this venture. Prior to her investment role at DCVC, she led new product introduction at Tesla and FitBit, overseeing the establishment of four factories in China for the wearables company. Today, in addition to her investment work at DCVC, she co-founded the NextGen Industry Group, dedicated to promoting the adoption of innovative technologies within the manufacturing sector.

Werner highlighted two primary challenges faced by all manufacturers when bringing a product to market: capital and human capital. Fortunately for the nuclear industry, access to capital is currently abundant. “They are awash in capital right now,” she noted. This influx of funding alleviates one significant constraint. Nevertheless, the nuclear industry isn’t immune to the other substantial challenge – the shortage of skilled labor. “We haven’t engaged in building industrial facilities in the United States for approximately 40 years,” Werner explained. “As a result, we’ve lost the necessary ‘muscle memory.’ It’s analogous to attempting a marathon after a decade of inactivity – a difficult and potentially detrimental undertaking.”

The U.S. has experienced a decline in the workforce possessing expertise in factory construction and operation. “There are certainly individuals within the United States with these skills, but the quantity is insufficient to staff a fully operational, seasoned manufacturing workforce,” Werner elaborated. This extends beyond machine operators to encompass roles such as factory floor supervisors, financial officers (CFOs), and members of the board of directors.

A positive development is the trend of startups, both within the nuclear sector and elsewhere, establishing early-stage production facilities in close proximity to their technical teams. “This approach is bringing manufacturing closer to the United States, enabling a continuous cycle of improvement,” Werner stated. To realize the benefits of mass manufacturing, it is crucial for startups to initially produce small quantities and then scale up production gradually. “Really leaning into modularity is a critical element for investors,” she added. This modular approach enables companies to gather data on the manufacturing process and iteratively improve it over time, providing investors with greater confidence.

It’s important to recognize that the full impact of mass manufacturing doesn’t materialize instantaneously. Companies frequently forecast cost reductions resulting from the learning process inherent in manufacturing, but these reductions may not be realized for a decade or longer. “Often, it takes years—a decade—to achieve these savings,” Werner concluded.