Electric vehicle maker Rivian has grabbed a lot of headlines lately for its highly anticipated initial public offering (IPO), bolstered by the company’s association with the likes of Amazon and Ford. Flying a little further below the radar was Rivian’s recent announcement that it has created a new fund that aims to protect the environment and reverse the effects of a changing climate.
The “Forever Fund” was announced by Rivian CEO RJ Scaringe in an October 4 note on the company’s website. Rivian plans to put 1% of its equity into the fund to provide a “substantial and growing financial platform to focus on high impact climate initiatives,” with a special emphasis on preserving and restoring wildlands, waterways and oceans.
The Forever Fund’s primary mission is to address changes to the planet’s climate while also preserving the biodiversity needed for its long-term survival.
In addition to its efforts to protect wildlands, waterways and oceans, the program will include community education and outreach programs. Rivian employees will be encouraged to participate in local projects to improve the natural world and advance the Forever Fund’s mission.
Rivian brings a lot of corporate might to the table. The company has been backed financially by Amazon and Ford, along with well-heeled institutional investors such as T. Rowe Price Associates and Coatue Management. The New York Times, citing Securities and Exchange Commission (SEC) documents, reported that Rivian has more than $10 billion in investments from these and other companies.
The Amazon relationship extends beyond just financial backing. In addition to investing more than $1.8 billion in Rivian, the online retail giant has a contract to buy 100,000 of Rivian’s delivery vehicles.
The Forever Fund announcement came a few days after Rivian filed for an IPO. One thing the filing revealed is that the company is spending–and losing–a lot of money.
According to its SEC filings, Rivian has lost about $2 billion since the start of last year as it continues to invest heavily in the business while posting minimal sales. Part of the money has been spent on adding new employees. Rivian had 6,274 employees at the end of June–nearly triple the total from a year earlier. It expects to spend around $8 billion on facilities and equipment by the end of 2023.
“We do not expect to be profitable for the foreseeable future as we invest in our business, build capacity and ramp up operations,” Rivian said in its SEC filing, “and we cannot assure you that we will ever achieve or be able to maintain profitability in the future.”
But Rivian’s financial backers seem to like its chances of competing against electric vehicle (EV) rivals such as Tesla, which underwent its own growing pains as a startup. Founded in 2009, Rivian plans to sell its EVs in the United States and Canada first, followed by expansion into Western Europe and then Asia.
In terms of its environmental program, the company aims to achieve carbon neutrality across its entire business no later than 2028, and ideally much sooner than that. In early 2023, following its first full year of production, Rivian will publish its first environmental impact report.
Rivian says it designs cars and products “for complete life cycles across everything we do.” This includes its battery packs, which are designed to be easily removed from the company’s vehicles and either recycled or used in “second life” applications such as stationary storage. Vehicle interiors are made from 100% animal-free materials. Dunnage containers at its manufacturing facilities plant are reusable and made from plastics harvested from the ocean. The EV company is making strides towards a more sustainable future.