The innovative laboratory diamond creator, Diamond Foundry, has soared to a market valuation of $1.8 billion thanks to a $200 million infusion from Fidelity.
The firm is gearing up to challenge the established heavyweights of the diamond mining industry, such as De Beers, by crafting impeccable lab-grown diamonds which it touts to be more sustainable for the environment.
A-list celebrities like Leonardo DiCaprio, tech pioneers Tony Fadell of Nest fame, and online gaming mogul Mark Pincus from Zynga have thrown their financial support behind the company. Diamond Foundry aims to ramp up its manufacturing operations in Washington, targeting an output of 5 million carats annually by the closure of 2022, still just a fraction of De Beer’s output in 2020. “The production of such high-caliber diamonds at such a significant scale is unprecedented,” CEO Martin Roscheisen reported to the Financial Times.
The enterprise is setting its sights on international markets and luxury consumers, offering its diamonds both directly to clients through its Vrai & Oro brand and in partnership with retailers. Additionally, they are carving out a niche in the semiconductor sector.
Over the past four years, the business has seen a doubling in diamond output. As per Bain & Company, naturally mined diamonds have experienced a downturn, with a 20 percent drop in 2020 to 111 million carats from a high of 152 million carats in 2017.
With no significant new diamond mines expected to emerge, the industry is reaching a critical juncture, Roscheisen observed. Currently, Diamond Foundry offers its diamonds at an overall price of $282 per rough carat, a figure that aligns closely with certain excavated stones.
Industry expert Paul Zimnisky notes that cultivated diamonds often cost less than their natural counterparts, with a half-carat synthetic stone trading for around $615, while a mined diamond of similar size commands $1,395.
Advancing its technology, Diamond Foundry is delving into the fabrication of 200mm single-crystal diamond wafers for semiconductors. Diamond’s superior heat conduction abilities make it an excellent material to enhance semiconductors, with applications in data centers, electric vehicles, and 5G networks.
“Global tech giants are exploring the use of diamond wafers. Although the all-diamond chip hasn’t been realized just yet, it’s a challenge we’re steadily overcoming,” Roscheisen stated.
Since its inception in 2012, Diamond Foundry has garnered $315 million in funding and maintains a debt-free ledger. It marked its transition into profitability in 2020.
While synthetic diamonds gain market traction for their eco-friendly image, they face an uphill battle against mined diamonds, which are valued for their uniqueness and historical allure. Besides, the ethical and carbon-neutral status of lab diamonds relies on the purchase of solar credits.
Still, these man-made marvels score points for their exclusively lab-based origin, guaranteeing genuine and transparent production without environmental or social harm. Affordability and versatility for different industrial purposes further add to their appeal.
Nevertheless, Diamond Foundry faces competition. De Beers has introduced its own line of synthetic stones, Lightbox, and Parisian luxury synthetic jeweler Courbet, backed by Chanel, is poised to penetrate the Chinese market. Another contender is Kimai, adding to the growing list of brands in this sector.
