Green Hydrogen Startup Modern Hydrogen Lays Off Majority of Workforce Amid Funding Crunch

Modern Hydrogen has letting go most of its roughly 80 staffers and telling vendors to hit pause on every project. In a no-frills email, CFO Amir Moftakhar pointed to “shifting funding conditions,” leaving critical pilots and an almost-ready commercial unit in Texas in limbo. People are still picking up the pieces as suppliers and former employees scramble to figure out what’s next.

From Heat Recovery to Hydrogen Ambitions

The story began in 2015 when a Bill Gates-backed team spun out as Modern Electron under Intellectual Ventures, turning everyday furnaces and water heaters into clever heat-and-power combos. After raising about $125 million from heavy hitters like Bill Gates and NextEra Energy, they quietly shifted gears in 2023, rebranding as Modern Hydrogen and zeroing in on green hydrogen. That move wasn’t on a whim—they did some soul-searching and figured the real opportunity was powering big industries with something cleaner than burning natural gas.

By late 2024, the headcount had climbed to around 80, and the team had rolled out pilot demos with utilities in Portland and Miami. A January 2025 MOU with Puget Sound Energy aimed to sell in to steel, cement, and pulp-and-paper makers itching to swap out dirty fuels.

Reimagining Natural Gas: The Methane Cracking Approach

At the heart of their tech is a proprietary methane cracking device that splits natural gas into clean hydrogen and solid carbon—no belching CO₂ like steam methane reforming. And that carbon? It’s not garbage. In 2024, Bill Gates even patched a pothole using asphalt mixed with the startup’s carbon black. It was a clever proof-of-concept that grabbed headlines and demonstrated the carbon byproduct can be a valuable commodity.

Heavyweights in the Ring

With backing from Breakthrough Energy Ventures and other top-tier funds, Modern Hydrogen looked set to go commercial. But earlier this year CTO Max Mankin exited, and rumors of budget troubles started to swirl. At the time, his departure rang alarm bells for industry watchers.

Why the Sudden Halt?

This pullback didn’t happen in a vacuum. Rising interest rates and a rethink of climate programs under the new administration squeezed venture funding hard. Just two days before the layoffs, Gates circulated a memo downplaying climate-urgency rhetoric—though he reminded everyone humans will “manage to live and thrive.” He hasn’t publicly commented on the job cuts, leaving plenty of questions unanswered.

Modern Hydrogen’s sudden stall is a cautionary tale: even a well-funded, Bill Gates-backed startup can stumble without steady policy support and patient capital. Yet the drive for industrial decarbonization is far from over. Green hydrogen still offers a compelling solution for steel, cement, and heavy transport—provided investors and governments look beyond short-term returns.

Between patent auctions, potential buyout talks, and many left wondering who will step up to finish the Texas project, one thing’s clear: making the hydrogen transition stick will take more than buzzworthy demos. It demands resilient business models, solid partnerships, and the grit to see the journey through all its ups and downs.