In an indistinct office park in the suburban outskirts of Boston, a ten-year-old startup is trying to reinvent a process at the core of the $1.6 trillion steel industry to reduce carbon emissions and fight climate change.
It’s the first time the IFC has ever invested in a pre-revenue startup, which speaks to the value the World Bank sees in helping low-income nations make steel without carbon emissions, IFC Director William Sonneborn told CNBC.
“I am just here in Africa,” Sonneborn said in a video call from Senegal at the end of May. “There are hundreds of millions of people that don’t have a house. At some point, they’re going to need steel. And so the incremental steel production of the world is not going to be in the U.S. — the technology may have been invented at MIT, but the incremental steel production is not going to be in the U.S.”
The majority of crude steel, 59%, was manufactured in developing countries in 2021, according to the IFC. Boston Metal’s process will be particularly attractive in developing nations that also have access to clean electricity, such as Chile, Ethiopia, Malawi, Uruguay, and Zambia, the IFC says.
CNBC visited Boston Metal’s headquarters in Woburn, Mass., at the end of May to learn more about the startup that’s raised hundreds of millions of dollars from investors like ArcelorMittal (the second-largest steel producer in the world), Microsoft‘s Climate Fund, and Bill Gates’ Breakthrough Energy Ventures in addition to the World Bank.
The Boston Metal offices in Woburn, Mass.
Cat Clifford, CNBC
How Boston Metal is cleaning up the historically dirty backbone of infrastructure
The conventional steel-making process puts iron ore or iron oxide in a coal-powered blast furnace, which generates significant carbon dioxide emissions. In a conventional steel mill, two tons of carbon dioxide are generated for every ton of steel that is made, explained Boston Metal executive Adam Rauwerdink during a tour of the lab.
Instead, Boston Metal uses an electro-chemical process called molten oxide electrolysis.
A diagram of the process Boston Metal is using to make green steel.
Graphic courtesy Boston Metal
The technique passes electricity through iron oxide mixed with a slew of other oxides, which are chemical compounds that contain at least one oxygen atom. If the electricity that goes into the process is clean, then the steel that comes out the other side of the electrolysis cell is clean, too.
The process resembles a battery, with a positively charged anode and negatively charged cathode directing the flow of electricity through the process.
For Boston Metal’s electrolysis to work, it has to convert the alternating current from the grid to direct current.
This is where the electricity is converted from AC to DC in the Boston Metal location. (A portion of the photo has been altered to protect the intellectual property of Boston Metal.)
Cat Clifford, CNBC
The anode in Boston Metal’s process was a key development from MIT. It’s primarily made of chrome and iron with some other small quantities of other materials mixed in, and does not get consumed or corroded during the electrolysis process.
“What’s special about it is it can survive at high temperature — 1,600 Celsius, 3,000 Fahrenheit. And as you’re doing electrolysis, you’re using electrons to split apart iron and oxygen. So that anode is getting hit by oxygen all day long at super high temperature, and it has to survive in that environment,” explained Rauwerdink during a tour of the lab. “There’s very few elements that will do that. That alloy is one that will.”
The byproduct of the process is oxygen.
The Boston Metal electrolysis process releases oxygen as a byproduct. On the screen circled, oxygen bubbles can be seen being released. (The text on the white board has been blurred out to protect the intellectual property of Boston Metal.)
Cat Clifford, CNBC
While Boston Metal is still iterating on the commercial-scale technology, the science behind the process is assured.
“It’s no longer a binary thing that you will fail or you will succeed,” Boston Metal CEO Tadeu Carneiro told CNBC in Woburn. “It’s a question of how long will be the life of the anode? Is it going to last three years or two years? That’s where we are now, we are finalizing all the parameters in order to build the biggest, the largest industrial cell. So that’s where we are.”
The steel industry is watching.
“The first thing I did when I joined the company was to visit my friends, all the CEOs of the different steelmaking companies, especially in Asia, to present them the idea. That’s six years ago,” Carniero said. “It’s funny, for most of them, it seemed to be too early. Now, they are all desperate — because they have to find a solution. And they don’t have a solution.”
Other benefits of the process
Boston Metal’s process can use low-grade iron ore, which is one of the reasons that the IFC invested in the company.
Boston Metal can make steel with low grade iron ore, such as this Australian ore from mining company BHP, which is one of the start-up’s investors.
Cat Clifford, CNBC
“There are many emerging markets that have lots of iron ore, it’s just low quality and so therefore they can’t have steel production with blast furnace technology. They can use the Boston Metal technology,” Sonneborn told CNBC.
That means that these developing markets can make their own steel, creating self-sufficiency for these countries’ economies, Sonneborn said.
Also, the electrolysis cells can get bigger to a certain point, but after that the company will have to place many cells next to each other to make green steel.
This is a mid-size electrolysis device, between the lab scale bench and the full-scale cell. This can run for weeks at a time and gathers performance data for the anode. (The text on the white board has been covered to protect the intellectual property of Boston Metal.)
Cat Clifford, CNBC
“If you go to a full-scale plant using this technology, you might see a couple hundred electrolysis cells.” Rauwerdink told CNBC.
That cell modularity is attractive to the World Bank.
“The modular technology of Boston Metal allows a small country like Burkina Faso to build their own steel plant, to have their own steel production — as opposed to importing it from India and paying hard currency outside of the country when it could actually do it internally,” Sonneborn told CNBC.
Here, one full-scale anode is running the electrolysis process at Boston Metal’s Woburn location.
Cat Clifford, CNBC
Another, faster path to revenue
Boston Metal is in the midst of raising what it hopes will be a $300 million funding raise. So far, it has closed half of that round and has “much of the remainder spoken for,” Rauwerdink told CNBC.
The main goal of Boston Metal is green steel, but the company will also use its core electrolysis technology to produce tin, niobium, and tantalum metals from what is otherwise considered waste from the mining process. About one third of the $300 million will go towards getting this program commercialized in its Brazil subsidiary, and the largest device the company has built so far will be used there.
Reporter Cat Clifford stands next to Boston Metal’s multi-anode electrolyzer cell. (A portion of the device has been covered to protect the intellectual property of Boston Metal.)
Cat Clifford, CNBC
Niobium is primarily used in making steel, tin us used both as a metal and in electronics, and tantalum is used, among other purposes, in the electronics industry for capacitors and other components.
“It’s easier, that’s why we can deploy earlier,” Carneiro told CNBC in Woburn. “The characteristics of the anodes are different.”
The metal-generation business in Brazil will be the first to generate revenue for the company.
The other two thirds of the $300 million raise will go towards finalizing the development of the steel making process and its components. Boston Metal plans to be at commercial scale for making green steel in 2026.
When Boston Metal is ready to commercialize its green steel operation, these kinds of cells will run for years at a time. Boston Metal will make money both by licensing the technology and by making and selling the anodes needed for the green steel process.
Boston Metal hopes to start licensing the technology in 2026, Carniero told CNBC.
IFC wants Boston Metal to be successful so that it can help developing nations build their own steel manufacturing, but also so it can generate returns for other projects. IFC does not pay out dividends from its investments to investors — all gains go right back into the coffer.
“When we exit, all of those gains are going to go back to solving gender inequality in India or South Asia or climate challenges in different aspects. So every profit that we make, again doesn’t get distributed as a dividend to our shareholders, it gets reinvested back into our development goals,” Sonneborn told CNBC.
AppLovin CEO Adam Foroughi provided more clarity on the ad-tech company’s late-stage effort to acquire TikTok, calling his offer a “much stronger bid than others” on CNBC’s The Exchange Friday afternoon.
Foroughi said the company is proposing a merger between AppLovin and the entire global business of TikTok, characterizing the deal as a “partnership” where the Chinese could participate in the upside while AppLovin would run the app.
“If you pair our algorithm with the TikTok audience, the expansion on that platform for dollars spent will be through the roof,” Foroughi said.
The news comes as President Trump announced he would extend the deadline a second time for TikTok’s Chinese-owned parent company ByteDance to sell the U.S. subsidiary of TikTok to an American buyer or face an effective ban on U.S. app stores. The new deadline is now in June, which, as Foroughi described, “buys more time to put the pieces together” on AppLovin’s bid.
“The president’s a great dealmaker — we’re proposing, essentially an enhancement to the deal that they’ve been working on, but a bigger version of all the deals contemplated,” he added.
AppLovin faces a crowded field of other interested U.S. backers, including Amazon, Oracle, billionaire Frank McCourt and his Project Liberty consortium, and numerous private equity firms. Some proposals reportedly structure the deal to give a U.S. buyer 50% ownership of the company, rather than a complete acquisition. The Chinese government will still need to approve the deal, and AppLovin’s interest in purchasing TikTok in “all markets outside of China” is “preliminary,” according to an April 3 SEC filing.
Correction: A prior version of this story incorrectly characterized China’s ongoing role in TikTok should AppLovin acquire the app.
U.S. President Donald Trump speaks during an event announcing new tariffs in the Rose Garden at the White House in Washington, April 2, 2025.
Chip Somodevilla | Getty Images
President Donald Trump announced an aggressive, far-reaching “reciprocal tariff” policy this week, leaving many economists and U.S. trade partners to question how the White House calculated its rates.
Trump’s plan established a 10% baseline tariff on almost every country, though many nations such as China, Vietnam and Taiwan are subject to much steeper rates. At a ceremony inthe Rose Garden on Wednesday, Trump held up a poster board that outlined the tariffs that it claims are “charged” to the U.S., as well as the “discounted” reciprocal tariffs that America would implement in response.
Those reciprocal tariffs are mostly about half of what the Trump administration said each country has charged the U.S. The poster suggests China charges a tariff of 67%, for instance, and that the U.S. will implement a 34% reciprocal tariff in response.
However, a report from the Cato Institute suggests the trade-weighted average tariff rates in most countries are much different than the figures touted by the Trump administration. The report is based on trade-weighted average duty rates from the World Trade Organization in 2023, the most recent year available.
The Cato Institute says the 2023 trade-weighted average tariff rate from China was 3%. Similarly, the administration says the EU charges the U.S. a tariff of 39%, while the 2023 trade-weighted average tariff rate was 2.7%, according to the report.
In India, the Trump administration claims that a 52% tariff is charged against the U.S., but Cato found that the 2023 trade-weighted average tariff rate was 12%.
Many users on social media this week were quick to notice that the U.S. appeared to have divided the trade deficit by imports from a given country to arrive at tariff rates for individual countries. It’s an unusual approach, as it suggests that the U.S. factored in the trade deficit in goods but ignored trade in services.
The Office of the U.S. Trade Representative briefly explained its approach in a release, and stated that computing the combined effects of tariff, regulatory, tax and other policies in various countries “can be proxied by computing the tariff level consistent with driving bilateral trade deficits to zero.”
“If trade deficits are persistent because of tariff and non-tariff policies and fundamentals, then the tariff rate consistent with offsetting these policies and fundamentals is reciprocal and fair,” the USTR said in the release.
Microsoft CEO Satya Nadella speaks during the Microsoft Build conference at Microsoft headquarters in Redmond, Washington, on May 21, 2024.
Jason Redmond | AFP | Getty Images
A half-century ago, childhood friends Bill Gates and Paul Allen started Microsoft from a strip mall in Albuquerque, New Mexico. Five decades and almost $3 trillion later, the company celebrates its 50th birthday on Friday from its sprawling campus in Redmond, Washington.
Now the second most valuable publicly traded company in the world, Microsoft has only had three CEOs in its history, and all of them are in attendance for the monumental event. One is current CEO Satya Nadella. The other two are Gates and Steve Ballmer, both among the 11 richest people in the world due to their Microsoft fortunes.
While Microsoft has mostly been on the ascent of late, with Nadella turning the company into a major power player in cloud computing and artificial intelligence, the birthday party lands at an awkward moment.
The company’s stock price has dropped for four consecutive months for the first time since 2009 and just suffered its steepest quarterly drop in three years. That was all before President Donald Trump’s announcement this week of sweeping tariffs, which sent the Nasdaq tumbling on Thursday and Microsoft down another 2.4%.
Cloud computing has been Microsoft’s main source of new revenue since Nadella took over from Ballmer as CEO in 2014. But the Azure cloud reported disappointing revenue in the latest quarter, a miss that finance chief Amy Hood attributed in January to power and space shortages and a sales posture that focused too much on AI. Hood said revenue growth in the current quarter will fall to 10% from 17% a year earlier
Nadella said management is refining sales incentives to maximize revenue from traditional workloads, while positioning the company to benefit from the ongoing AI boom.
“You would rather win the new than just protect the past,” Nadella told analysts on a conference call.
The past remains healthy. Microsoft still generates around one-fifth of its roughly $262 billion in annual revenue from productivity software, mostly from commercial clients. Windows makes up around 10% of sales.
Meanwhile, the company has used its massive cash pile to orchestrate its three largest acquisitions on record in a little over eight years, snapping up LinkedIn in late 2016, Nuance Communications in 2022 and Activision Blizzard in 2023, for a combined $121 billion.
“Microsoft has figured out how to stay ahead of the curve, and 50 years later, this is a company that can still be on the forefront of technology innovation,” said Soma Somasegar, a former Microsoft executive who now invests in startups at venture firm Madrona. “That’s a commendable place for the company to be in.”
When Somasegar gave up his corporate vice president position at Microsoft in 2015, the company was fresh off a $7.6 billion write-down from Ballmer’s ill-timed purchase of Nokia’s devices and services business.
Microsoft is now in a historic phase of investment. The company has built a $13.8 billion stake in OpenAI and last year spent almost $76 billion on capital expenditures and finance leases, up 83% from a year prior, partly to enable the use of AI models in the Azure cloud. In January, Nadella said Microsoft has $13 billion in annualized AI revenue, more even than OpenAI, which just closed a financing round valuing the company at $300 billion.
Microsoft’s spending spree has constrained free cash flow growth. Guggenheim analysts wrote in a note after the company’s earnings report in January, “You just have to believe in the future.”
Of the 35 Microsoft analysts tracked by FactSet, 32 recommend buying the stock, which has appreciated tenfold since Nadella became CEO. Azure has become a fearsome threat to Amazon Web Services, which pioneered the cloud market in the 2000s, and startups as well as enterprises are flocking to its cloud technology.
Winston Weinberg, CEO of legal AI startup Harvey, uses OpenAI models through Azure. Weinberg lauded Nadella’s focus on customers of all sizes.
“Satya has literally responded to emails within 15 minutes of us having a technical problem, and he’ll route it to the right person,” Weinberg said.
Still, technology is moving at an increasingly rapid pace and Microsoft’s ability to stay on top is far from guaranteed. Industry experts highlighted four key issues the company has to address as it pushes into its next half-century.
Microsoft didn’t respond to a request for comment.
Regulation
There’s some optimism that the Trump administration and a new head of the Federal Trade Commission will open up the door to the kinds of deal-making that proved very challenging during Joe Biden’s presidency, when Lina Khan headed the FTC.
But regulatory uncertainty remains.
It’s not a new risk for Microsoft. In 1995, the company paid a $46 million breakup fee to tax software maker Intuit after the Justice Department filed suit to block the proposed deal. Years later, the DOJ got Microsoft to revamp some of its practices after a landmark antitrust case.
Microsoft pushed through its largest acquisition ever, the $75 billion purchase of video game publisher Activision, during Biden’s term. But only after a protracted legal battle with the FTC.
At the very end of Biden’s time in office, the FTC opened an antitrust investigation on Microsoft. That probe is ongoing, Bloomberg reported in March.
Nadella has cultivated a relationship with Trump. In January, the two reportedly met for lunch at Trump’s Mar-a-Lago resort in Florida, alongside Tesla CEO Elon Musk.
President Donald Trump shakes hands with Microsoft CEO Satya Nadella during an American Technology Council roundtable at the White House in Washington on June 19, 2017.
Nicholas Kamm | AFP | Getty Images
The U.S. isn’t the only concern. The U.K.’s Competition and Markets Authority said in January that an independent inquiry found that “Microsoft is using its strong position in software to make it harder for AWS and Google to compete effectively for cloud customers that wish to use Microsoft software on the cloud.”
Microsoft last year committed to unbundling Teams from Microsoft 365 productivity software subscriptions globally to address concerns from the European Union’s executive arm, the European Commission.
Noncore markets
Fairly early in Microsoft’s history the company became the world’s largest software maker. And in cloud, Microsoft is the biggest challenger to AWS. Most of the company’s revenue comes from corporations, schools and governments.
But Microsoft is in other markets where its position is weaker. Those include video games, laptops and search advertising.
Mary Jo Foley, editor in chief at advisory group Directions on Microsoft, said the company may be better off focusing on what it does best, rather than continuing to offer Xbox consoles and Surface tablets.
“Microsoft is not good at anything in the consumer space (with the possible exception of gaming),” wrote Foley, who has covered the company on and off since 1984. “You’re wasting time and money on trying to figure it out. Microsoft is an enterprise company — and that is more than OK.”
It’s unlikely Microsoft will back away from games, particularly after the Activision deal. Nearly $12 billion of Microsoft’s $69.6 billion in fourth-quarter revenue came from gaming, search and news advertising, and consumer subscriptions to the Microsoft 365 productivity bundle. That doesn’t include sales of devices, Windows licenses or advertising on LinkedIn.
“As a company, Microsoft’s all-in on gaming,” Nadella said in 2021 in an appearance alongside gaming unit head Phil Spencer. “We believe we can play a leading role in democratizing gaming and defining that future of interactive entertainment, quite frankly, at scale.”
AI pressure
Microsoft has an unquestionably strong position in AI today, thanks in no small part to its early alliance with OpenAI. Microsoft has added the startup’s AI models to Windows, Excel, Bing and other products.
The breakout has been GitHub Copilot, which generates source code and answers developers’ questions. GitHub reached $2 billion in annualized revenue last year, with Copilot accounting for more than 40% of sales growth for the business. Microsoft bought GitHub in 2018 for $7.5 billion.
Microsoft CEO Satya Nadella, right, speaks as OpenAI CEO Sam Altman looks on during the OpenAI DevDay event in San Francisco on Nov. 6, 2023.
Justin Sullivan | Getty Images
But speedy deployment in AI can be worrisome.
The company is “not providing the underpinnings needed to deploy AI properly, in terms of security and governance — all because they care more about being ‘first,'” Foley wrote. Microsoft also hasn’t been great at helping customers understand the return on investment, she wrote.
AI-ready Copilot+ PCs, which Microsoft introduced last year, aren’t gaining much traction. The company had to delay the release of the Recall search feature to prevent data breaches. And the Copilot assistant subscription, at $30 a month for customers of the Microsoft 365 productivity suite, hasn’t become pervasive in the business world.
“Copilot was really their chance to take the lead,” said Jason Wong, an analyst at technology industry researcher Gartner. “But increasingly, what it’s seeming like is Copilot is just an add-on and not like a net-new thing to drive AI.”
Innovation
At 50, the biggest question facing Microsoft is whether it can still build impressive technology on its own. Products like the Surface and HoloLens augmented reality headset generated buzz, but they hit the market years ago.
Teams was a novel addition to its software bundle, though the app’s success came during the Covid pandemic after the explosive growth in products like Zoom and Slack, which Salesforce acquired. And Microsoft is still researching quantum computing.
In AI, Microsoft’s best bet so far was its investment in OpenAI. Somasegar said Microsoft is in prime position to be a big player in the market.
“To me, it’s been 2½ years since ChatGPT showed up, and we are not even at the Uber and Airbnb moment,” Somasegar said. “There is a tremendous amount of value creation that needs to happen in AI. Microsoft as much as everybody else is thinking, ‘What does that mean? How do we get there?'”