# Mangrove Lithium Financial Model

Electrochemical process technology that converts lithium brine directly into battery-grade lithium hydroxide (LiOH), bypassing the conventional carbonate intermediate step.

- Canonical: https://finamodel.com/startups/mangrove-lithium
- Excel download: https://finamodel.com/startup-models/mangrove-lithium.xlsx
- Category: Climate/Energy
- Model type: 3-Statement
- Funding round: Series A
- Funding: $10M
- Founded: 2021
- Geography: Global focus; primary feedstock from the Lithium Triangle (Argentina, Chile, Bolivia) [DECK, slide 3].
- Customer: B2C

## About the company

Mangrove Lithium has developed an electrochemical process that converts lithium chloride from brine directly into battery-grade lithium hydroxide. By bypassing lithium carbonate, it aims to reduce cost, remove impurity-prone steps, and unlock brine feedstocks for NMC and NCA cathodes.

The market case is the projected lithium supply gap as EV demand expands, especially in the Lithium Triangle's large brine reserves. A fully integrated commercial-scale demonstration plant has operated since 2019, but the deck gives no customer, offtake, production, pricing, or contract details.

The model should be plant-level and commodity-driven: capacity, ramp-up, lithium recovery, LiOH price, electricity and reagent cost, and capital intensity determine project returns. Build alternative revenue cases for technology licensing, tolling, or owned production, then layer corporate costs and project-finance debt, equity, and cash flows above each plant.

## What's included

- 5-year monthly revenue build with stage-appropriate growth assumptions
- Full P&L, headcount plan, and operating-expense schedule
- Cash-flow statement, runway, and burn-rate tracking
- Valuation via exit multiple with a DCF cross-check
- Returns analysis with MOIC and IRR
- Unit economics including CAC, LTV, payback, and cohort retention

## Product & value proposition

- Core technology: Mangrove's electrochemical process directly converts lithium chloride (LiCl from brine) into battery-grade lithium hydroxide monohydrate (LiOH·H₂O) without producing lithium carbonate as an intermediate.
- Key advantages claimed:
  - Eliminates CAPEX and OPEX of a separate LiOH conversion plant.
  - Removes chemical phase-separation steps that introduce impurities in conventional process.
  - Enables battery-grade LiOH from Salar brines (the largest global lithium reserves) which conventional processing cannot reliably achieve.
- Positioning: "Lowest cost" battery-grade LiOH producer, enabling brine assets (Lithium Triangle) to supply the high-growth NMC/NCA cathode market.

## Market

- Demand context: Lithium supply bottlenecks projected to limit EV adoption by >350 million EVs.
- Demand chart (Benchmark Mineral Intelligence, Q4 2019): Total LiOH/LiCO₃ demand reaches ~5,500,000–6,000,000 tonnes LCE by 2040 vs. operational + probable supply of ~1,500,000–1,700,000 tonnes - implying a large structural supply gap from ~2024 onward.
- Reserve context: Lithium Triangle holds the largest global reserves - Argentina 14.8 Mt, Bolivia 9 Mt, Chile 8.5 Mt (all brine-dominant assets).

## Revenue model

- Technology licensing / royalty per tonne of LiOH produced - common for process-IP companies; aligns with "Mangrove plant" language suggesting modular skids sold or licensed to brine operators.
- Tolling / offtake - Mangrove builds and operates plants, sells LiOH directly. Not evidenced.
- Joint venture with brine asset owners. Not evidenced.

No pricing, contract terms, revenue per unit, or customer names appear in deck.

## Traction & metrics

- Commercial-scale demonstration plant: fully integrated operation since 2019.
- No revenue figures, customer names, signed offtakes, tonnes produced, or conversion efficiency data shown in deck.

## Competition / moat

- Problem with incumbents: Conventional brine producers (SQM, Albemarle, Livent) must build both a carbonate and a hydroxide plant - higher cost and impurity issues.
- Hard-rock (spodumene) producers supply most of current LiOH but at higher cost; deck asserts Mangrove enables brine to undercut hard-rock on LiOH cost.
- Moat claimed: Proprietary electrochemical process (IP not detailed). Demonstration plant operational since 2019 suggests a meaningful technical lead.

## Team & funding ask / use of funds

- Founder/presenter: Saad Dara.

## Recommended financial model

- **Archetype + why:** Commodity process-technology project finance model (single-product, cost-driven). Mangrove is a capital-intensive process technology company whose value is denominated in $/tonne LiOH produced and plant economics. The appropriate model is a **plant-level project finance / techno-economic model** combined with a **technology licensing P&L** if the commercial model is IP-licensing. Primary outputs: cost of production (OPEX $/t LiOH), capital intensity (CAPEX $/t capacity), revenue per tonne vs. spot LiOH price, and IRR/NPV per plant. A 3-statement corporate model sits on top once the licensing/tolling structure is confirmed.

- **Forecast horizon & granularity:**
  - Plant-level: Year 0–3 construction + 15–20 year operating life (standard for process plants).
  - Corporate: Annual, 5–10 year horizon; monthly for first 2 years post-commercialisation.

- **Key drivers & assumptions:**
  - LiOH spot price ($/t): ~$15,000–$25,000/t battery-grade LiOH (2023–2025 range; highly volatile - key scenario lever).
  - Plant nameplate capacity (t LiOH/yr): scale-up from demo; first commercial plant likely 5,000–20,000 t/yr range; needs confirmation from management.
  - CAPEX per tonne of annual capacity: ~$1,000–$2,000/t (lower than conventional dual-plant; this is the core value claim - must be stress-tested).
  - OPEX per tonne (electricity, reagents, labour): electrochemical processes are electricity-intensive; assume $3,000–$6,000/t; electricity cost and efficiency (kWh/t LiOH) is the critical driver.
  - Brine feed LiCl grade and recovery rate: dependent on Salar; typical brine lithium grade 0.05–0.15% Li; recovery rate 80–90%.
  - Ramp-up schedule (% of nameplate by year): Year 1: 50%, Year 2: 80%, Year 3+: 95%.
  - Royalty/licence rate (if licensing model): $500–$2,000/t LiOH or % of revenue; structure unknown.
  - Number of plants licensed/built (growth driver): 1 commercial plant Year 1, scaling to 3–5 by Year 5.
  - Debt/equity mix for plant construction: 60/40 debt/equity typical for project finance; cost of debt 6–8%.
  - LiOH demand growth and supply-gap timing: supply gap widens materially post-2024 per Benchmark Mineral Intelligence.

- **Scenarios (Base / Bull / Bear - which variables flex):**
  - Bear: LiOH price $12,000/t; CAPEX overrun +30%; single plant; ramp delayed 12 months.
  - Base: LiOH price $18,000/t; CAPEX on plan; 3 plants by Year 5; ramp per schedule.
  - Bull: LiOH price $25,000/t; CAPEX beat −15%; 5 plants by Year 5; strategic partnership with Tier-1 brine operator.

- **Required sheets / outputs:**
  1. Assumptions - all drivers, switchboard for scenarios.
  2. Plant Operating Model - production schedule, OPEX build-up, CAPEX schedule per plant.
  3. Revenue - tonnes sold × LiOH price (or royalty rate × tonnes); by plant.
  4. Income Statement - EBIT, EBITDA, net income (corporate level).
  5. Capital Structure / Project Finance - debt drawdown, repayment, DSCR, equity IRR.
  6. Cash Flow Statement - operating, investing, financing; free cash flow.
  7. Balance Sheet (simplified).
  8. Valuation - DCF on corporate FCF; EV/EBITDA comparable check.
  9. Sensitivity Tables - LiOH price × OPEX; CAPEX × # of plants.

## Frequently asked questions

### Is the Mangrove Lithium financial model free?

Yes. The Mangrove Lithium model is a free Excel download with live formulas.

### Can I change the assumptions?

Yes. The workbook is editable and its live formulas recalculate when assumptions change.