Type One Energy, a Knoxville, Tennessee-based startup founded in 2019 to build fusion power plants, announced Tuesday morning that it has raised $200 million from investors.

The funding helps the startup move up the ranks of the top-funded fusion power companies. But fusion is a costly field to work in. It sits at the cutting edge of plasma physics, materials science, and advanced computation, and even $200 million doesn’t always go far.

Even so the new Series B should get the company halfway to paying for a 400-megawatt commercial power plant, Type One CEO Christofer Mowry told TechCrunch. If Type One can bring it online by 2034, he added, the company could complete its first power plant using less capital than many of its competitors, even with one or more subsequent rounds of funding.

The secret, Mowry said, is Type One’s business model. The company will design the power plant and many of its components, then turn to “bespoke” network of suppliers chosen for the project to build them, he said. Most fusion startups rely on suppliers for some components, but Type One plans to go further.

That approach keeps costs down. “The amount of capital that we need to raise to commercialize fusion at Type One is just a different order of magnitude than if you were going to be vertically integrated,” Mowry said, referring to companies that make most of their own parts in-house.

“Why would I want to spend on bricks and mortar?” he added. “I used to run a big nuclear manufacturing company. That’s expensive.”The fusion startup has already started assembling a roster of partners. Type One will build its first two fusion devices on the Tennessee Valley Authority’s Bull Run site, and infrastructure consultant AECOM is working on engineering for Infinity Two, the initial commercial power plant. Competitor Commonwealth Fusion Systems has licensed its high-temperature superconducting magnet technology to Type One, and the technology will help form the backbone of Type One’s reactor design.

By relying on outside suppliers, Type One becomes what’s known as an integrator, a company that assembles a product from parts made by others. That minimizes its own risk from activities like manufacturing, but it introduces a different kind of risk.

The upside is access to partners that may have more expertise in certain areas, like AECOM, the infrastructure consultant working on Infinity Two. “They have 10,000 people, most of them are engineers of one kind. We’re never going to have 10,000 people,” Mowry said.

The downside is that integrators have less control over their suppliers than an in-house team does. The most famous recent example might be Boeing, which relied on Spirit AeroSystems to supply fuselage sections for the 737 and 787 airliners. After a series of quality-control failures, including a door plug blowing out on an Alaska Airlines flight in 2024, Boeing bought Spirit, bringing it in-house to improve standards.

Type One is betting that it can manage the integration risk, and that it will be lower than the risk of doing everything in house. “These business models are successful because they let companies focus on managing risk and developing a high level of competency in their slice of the value chain,” Mowry said.

The round was led by repeat investor Breakthrough Energy Ventures and Clutterbuck Capital, with participation from Lowercarbon Capital, Siemens Energy Ventures, and SiteGround Capital. The company had previously raised at least $82.5 million.