Commonwealth Fusion Systems Stock and IPO: Will They Go Public?
Commonwealth Fusion Systems LLC (CFS) is an early-stage nuclear energy startup that wants to build the world’s first nuclear fusion power plant. That’s fusion, not fission. Fusion is a nuclear process for producing energy with significant advantages over the widely-known process of fission used by today’s power plants. Find out how you can invest in CFS and other nuclear energy-related stocks below.
Matt Johnston Updated March 17th, 2022
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What is Commonwealth Fusion Systems?
Commonwealth Fusion Systems is a Massachusetts-based renewable energy company focused on nuclear fusion energy. It was founded in 2018 after being spun out of the Plasma Science and Fusion Center (PSFC) at the Massachusetts Institute of Technology (MIT).
The startup traces its origins to a group of former MIT staff and students who wanted to commercialize fusion technology. These students include Bob Mumgaard, Brandon Sorbom, Dan Brunner, and Zach Hartwig. Mumgaard, Brunner, and Sorbom would go on to lead the company as CEO, CTO, and chief science officer, respectively.
CFS draws on decades of research to design and build fusion machines capable of producing clean energy. The company has assembled a team of experts in fields such as magnets, manufacturing, and plasma physics, a field of physics that studies states of matter composed of charged particles.
CFS plans to build the world’s first net energy-producing fusion machine, SPARC, eventually creating the first-ever commercial fusion power plant.
What is nuclear fusion?
Nuclear fusion is a process for creating nuclear energy. The same process produces energy in the sun and stars. Fusion should not be confused with the much more familiar nuclear process of fission. While both can create nuclear energy, fusion works by melding or fusing atoms, while fission works by splitting them. Both enable the release of energy. But fusion has several significant advantages compared to fission.
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One of fusion’s advantages is that it does not produce long-lived radioactive waste, unlike fission. The fusion process does not depend on a chain reaction. As a result, it is safer, helping avoid nuclear accidents. As for the problem of nuclear weapons, while hydrogen bombs use fusion reactions, they cannot be detonated without an extra fission bomb. Fusion doesn’t produce harmful emissions either, which benefits the environment.
All nuclear power plants today rely on nuclear fission, which requires uranium as fuel. In contrast, nuclear fusion is fueled by widely-available hydrogen derivatives.
However, nuclear fusion devices don’t yet generate enough energy to make them commercially useful. Devices that currently use the fusion process produce over ten megawatts of energy. But at least 500 megawatts of power must be produced for fusion power plants to become practical for meeting today’s energy needs. Several other technological issues also need to be solved. It will likely be a few decades before nuclear fusion is widely used to generate electricity.
🔔 Learn what other nuclear fusion startups are.
Is Commonwealth Fusion Systems publicly traded?
Commonwealth Fusion is a private company that does not have publicly traded shares. They haven’t disclosed any plans to go public, and CFS seems to have no problem raising capital. So far, CFS has raised over $2 billion through four funding rounds.
In its latest Series B round, which took place on December 1, 2021, CFS raised a cool $1.8 billion. Tiger Global led the round, which included Microsoft co-founder Bill Gates, billionaire investor George Soros, and venture capitalist John Doerr. Google also contributed.
Can you buy Commonwealth Fusion Systems stock?
Commonwealth Fusion does not have common shares that you can trade on an exchange, but that doesn’t mean there is no way to invest.
If you are looking to invest in companies that have yet to go public, you will have to use some form of pre-IPO investing. Three types of pre-IPO investing include:
- Buying shares from an employee or investor in the company using a platform like EquityZen or Forge
- Crowdfunding platforms such as StartEngine (CFS is not available through these platforms)
- Buying shares directly from the company as an accredited investor (you won’t be able to invest in a company like CFS unless you are a well-known VC, though)
- Has earned income over $200,000 in each of the past two years (or $300,000 with a spouse) and expects the same this year
- Has a net worth of more than $1 million (alone or with a spouse), excluding their primary residence
- Holds one of three special licenses issued by the Financial Industry Regulatory Authority (FINRA)
Alternatives to Commonwealth Fusion Systems stock
If you want to invest in nuclear energy but are not an accredited investor or you don’t want the risk of early-stage startups, you have other options. However, these options are focused on the more-established industry of nuclear fission.
Because uranium is the most widely-used fuel by today’s nuclear power plants, one of the best ways to gain exposure to nuclear energy is through investing in an ETF comprised of uranium mining stocks.
Four of the top uranium ETFs for making a play on nuclear energy include:
- Global X Uranium ETF (URA);
- North Shore Global Uranium Mining ETF (URNM)
- VanEck Uranium+Nuclear Energy ETF (NLR)
- Sprott Physical Uranium Trust (U.U)
🔔 Learn how to invest in nuclear fission stocks or ETFs.
Author: Matt Johnston
Matt is a finance and economics writer with seven years of professional writing experience, including over five years at Investopedia. He also sometimes teaches macroeconomics at St. Stephen’s University. But his intellectual interests are not limited to the world of finance and economics—he also enjoys reading history and philosophy as well as learning new languages, both natural and programming. Matt currently lives in Montreal, Quebec.
NOT INVESTMENT ADVICE. The content is for informational purposes only; you should not construe any such information as investment advice.