Electricity demand is rising faster than many expected, driven primarily by AI. Data centers are drawing power at a pace utilities struggle to support, and transmission constraints are becoming major bottlenecks across several regions. This shift has pushed companies, policymakers, and investors to search for power sources that do not require new transmission lines or decade-long megaprojects. Modular nuclear has entered the chat. The new designs are smaller, safer, and manufactured with a level of standardization that looks nothing like traditional nuclear construction. For years, nuclear power was dismissed as too slow, too expensive, and carrying too much public disapproval to match modern energy demand. Flash forward to today, a growing group of startups are designing reactors that are manufactured rather than constructed, sized for modern computing and industrial loads, and built around predictable deployment. The physics are established, but the engineering philosophy is new. As a result, nuclear is becoming easier for investors to underwrite and evaluate. Let’s dive into why modular nuclear is gaining momentum, the categories of companies emerging, and the investors shaping the early market.
The nuclear plants built from the 1960s through the 1990s were large, custom-designed, multibillion-dollar megaprojects that took many years to complete. They often suffered from delays and cost overruns, and several well-known incidents shaped public perception. Chernobyl reflected failures in design and operator culture. Three Mile Island showed how human error can escalate. Fukushima demonstrated the consequences of siting choices during extreme events.
In the past fifteen years, engineers revisited earlier reactor concepts and developed modern versions with simpler architectures and passive safety. Small modular reactors introduced the idea that reactors could be standardized and deployed repeatedly. Instead of one enormous plant every two decades, the goal became a factory-built product line. Note that these systems still rely on fission, not fusion. Fission is the long-established process used in today’s reactors, where splitting heavy atoms such as uranium releases heat that can be converted into electricity. Fusion, by contrast, requires fusing light atoms together at conditions similar to those inside the sun — a scientific challenge that has produced major research milestones but remains far from commercial operation, even as it continues to attract enormous interest and investment as the long-standing “holy grail” of clean energy. Modular fission can be built and deployed now because the physics, fuels, and safety characteristics are well-understood, whereas fusion still depends on breakthroughs in confinement, materials, and net-energy generation. Instead of a one-off construction project that takes ten years, the new approach uses standardized units manufactured in controlled environments. This makes nuclear more legible, more plannable, and more financeable.
Several forces are converging at the same time. Electricity demand from AI is rising sharply. Utilities in key data-center regions aren’t just slowing approvals — many have effectively stopped accepting new interconnection requests as local grids hit hard capacity limits. Transmission constraints, not generation, are increasingly the limiting factor. Renewables like solar and wind are growing but still require baseload power as a complement (though pairing battery storage with renewables is gaining traction.)
At the same time, nuclear technology itself has become far safer. Modern reactor designs use passive safety systems that rely on physics rather than mechanical pumps or operator action, meaning they shut down or cool themselves automatically in an emergency. Many advanced designs use coolants that cannot boil and fuel forms that are far more heat-tolerant, reducing the risk of meltdown by orders of magnitude.
Modular nuclear companies fall into several categories with different designs, output levels, and target markets, though they share the goals of reaching standardization, manufacturability, and predictable deployment. Below is an overview of key players that have attracted significant investment from deeptech and climate funds.
Aalo is designing very small, factory-manufactured reactors tailored to the power needs of AI data centers, allowing operators to install on-site clean power instead of waiting years for new grid connections. These reactors are built as standardized units in a factory, similar to how large industrial equipment is manufactured, which makes them faster and more predictable to deploy than traditional on-site nuclear construction. The company has raised more than 130 million dollars, including a 100 million dollar Series B from Nucleation Capital, Valor Equity Partners, Tishman Speyer, 50Y, Alumni Ventures, MCJ, and other industrial and climate investors. Aalo’s design aligns with the power profile of GPU clusters and emphasizes standardized, repeatable deployment, treating the reactor as a commercial product rather than a construction project.
Radiant is building Kaleidos, a portable 1 MWe high-temperature gas microreactor roughly the size of a shipping container. A capacity of 1 MWe means it can generate one megawatt of electric power, which is enough to run a small data center cluster, a military base, or a remote industrial operation. The reactor is gas-cooled, meaning it uses an inert gas such as helium instead of water to move heat out of the core. This allows the system to run at much higher temperatures, which improves efficiency and eliminates the risk of water boiling or pressurization failures. The “high-temperature” design makes it useful not only for electricity generation but also for industrial processes that require steady, high-quality heat. Its transportable format makes it well-suited for off-grid operations where diesel generators are currently the default. Radiant has raised over 200 million dollars across multiple rounds, including a Series B led by a16z and a Series C led by DCVC.
Last Energy develops a standardized 20 MWe pressurized water reactor built from repeatable, modular components. A 20 MWe reactor is significantly larger than a microreactor and can supply enough power for a large industrial facility or a smaller data center campus. Pressurized water reactors are the most common reactor type used globally and rely on water kept under pressure so it can absorb heat without boiling. Last Energy packages this proven technology into a small, pre-designed system that can be manufactured in sections and assembled quickly on-site. The company has raised 64 million dollars across its Series A and B and focuses heavily on replicability and private-sector deployment rather than traditional utility partnerships.
Oklo is developing compact fast-spectrum reactors designed to operate for long durations without refueling, making them suitable for remote industrial settings and mission-critical operations. Fast-spectrum reactors use high-energy neutrons, which allow them to extract significantly more energy from fuel compared to traditional reactors and extend the time between refueling cycles. Oklo has positioned its system as a long-life, highly reliable nuclear battery that can operate for years with minimal on-site support. Sam Altman is a noted early backer. In 2024 Oklo went public through a SPAC merger, raising over 300 million dollars in proceeds.
Kairos is building a molten-salt-cooled reactor system that uses liquid salt instead of water to carry heat away from the core. Liquid salt remains stable at high temperatures and does not boil the way water does, which improves both passive safety and thermal efficiency. This design makes the system naturally resistant to overheating and allows it to operate at temperatures useful for industrial processes. The company is constructing a demonstration unit and has developed partnerships across utilities and industrial stakeholders.
X-energy develops high-temperature gas reactors that can deliver both electricity and industrial-grade heat. These reactors use helium as a coolant, which allows them to reach temperatures far above those achievable by traditional water-cooled reactors. The ability to provide both power and heat makes them especially valuable to chemical plants, materials manufacturers, and other heavy industrial facilities that require constant thermal energy as well as electricity.
Nuclearn builds AI-driven software that automates the regulatory filings, safety documentation, and operational workflows required to run a nuclear facility. These processes are extremely paperwork-intensive and traditionally require large teams of specialists. By reducing manual documentation and automating compliance, Nuclearn helps both new reactor startups and existing plant operators accelerate deployment, reduce operational burdens, and improve safety. Nuclearn raised a 10.5 million dollar Series A led by Blue Bear Capital with participation from SJF Ventures, AZ-VC, and Nucleation Capital.
A number of companies are developing the specialized fuel cycles and components advanced reactors require. This includes high-assay low-enriched uranium (HALEU), which is enriched to a higher concentration of uranium-235 than the fuel used in today’s large nuclear plants and is essential for many advanced reactor designs. HALEU production is currently one of the largest bottlenecks in the sector. As microreactors approach deployment, demand for domestic fuel production and advanced manufacturing will accelerate.
Nucleation Capital is one of the most prominent venture funds specializing in advanced nuclear and deep decarbonization, with a portfolio that includes Aalo Atomics, Radiant, Nuclearn, and early-stage reactor concepts. Its specialization provides meaningful technical validation for co-investors. DCVC is another influential deeptech investor in the category, having backed Radiant, Oklo, and Zeno Power. A16z’s American Dynamism team invests in technologies that strengthen U.S. industrial capacity and national resilience, so nuclear fits squarely within this mandate. The firm is a major investor in Radiant and frequently highlights nuclear as foundational infrastructure for AI, defense, and advanced manufacturing. Breakthrough Energy Ventures (Bill Gate’s fund) invests in technologies capable of driving large-scale decarbonization. While not focused specifically on microreactors, the firm has backed multiple advanced fission and fusion companies and has helped legitimize nuclear as a climate-critical category.
As true of many deep tech and energy plays, regulatory approval remains detailed and time-intensive. Specific to nuclear, fuel supply – particularly HALEU – is limited. First-of-a-kind deployments require significant capital, blending venture-style risk with infrastructure-scale cost. Community acceptance still varies. Technical risks remain as new reactor designs must prove reliability and performance in real-world conditions. These challenges explain the need for specialized investors and disciplined deployment strategies.
Several companies aim to deploy their first units, shaping regulatory confidence and investor sentiment. Data centers are likely to be early adopters due to severe grid constraints. Industrial facilities will follow, given their need for continuous heat and power. As deployments begin, supply chain capacity will expand across fuel production, component manufacturing, and engineering services. International deployment will likely accelerate, particularly in regions with land constraints or congested grids.
Modular nuclear is emerging at a moment when the energy system urgently needs reliable, clean, flexible power. The new generation of reactor companies is smaller, safer, and built for repeatable deployment. A concentrated group of technically sophisticated investors has provided early capital and validation. If early deployments succeed, modular nuclear could become one of the defining energy technologies of the next decade and provide the stable foundation needed for AI infrastructure, industrial competitiveness, and deep decarbonization.
