Trump Jr.-Linked Firm Wins $620M Government Contract

Vulcan Elements Secures $620 Million Defense Contract, Raising Questions About political Connections

A rare-earth magnet startup, Vulcan Elements, backed by Donald Trump Jr.‘s venture capital firm 1789 capital, has landed a landmark $620 million contract with the U.S. Department of Defense. The deal, part of a broader $1.4 billion initiative involving the U.S. government and ReElement Technologies, aims to significantly bolster the domestic supply chain for critical magnets.

the contract represents the largest ever awarded by the Pentagon’s Office of Strategic Capital,according to reports from the Financial Times. This move underscores the growing U.S. focus on securing domestic sources for essential materials, particularly those with strategic military applications.

Did you know? – Rare-earth magnets are vital components in numerous defense systems, including missile guidance, radar, and jet engine controls. China currently controls a significant portion of the global supply.

1789 capital’s Expanding Government Portfolio

1789 Capital, where Trump Jr.joined as a partner in 2024, reportedly invested in vulcan Elements approximately three months ago, as noted by Bloomberg. The firm previously led a $65 million Series A funding round for the company in August, spearheaded by Altimeter Capital.

This latest contract isn’t an isolated incident for 1789 Capital. The Financial Times reported that at least four companies backed by the firm have secured government contracts this year alone.1789 Capital also maintains investments in established government contractors SpaceX and Anduril, both well-known for their technology sales to the U.S. government.

Pro tip: – The Pentagon’s Office of Strategic Capital was established in 2022 to accelerate the development and adoption of critical technologies,frequently enough through direct investment in emerging companies.

Addressing Concerns of Influence

Given Trump Jr.’s prominent role at 1789 Capital, questions have arisen regarding potential conflicts of interest. However, both Vulcan elements and a spokesperson for Trump Jr. have firmly denied any involvement by Trump Jr. in the contract negotiations. “He had no involvement in negotiations with the government on behalf of 1789’s portfolio companies,” the spokesperson stated.

A representative for Vulcan Elements echoed this sentiment, asserting to the Financial Times that Trump Jr.was not involved in the bidding process. Despite these denials, the timing of the contract and 1789 Capital’s increasing success in securing government deals are likely to draw continued scrutiny.

The U.S. government’s push to onshore rare-earth magnet production is a critical component of its broader strategy to reduce reliance on foreign suppliers, particularly China, which currently dominates the global market. This contract with Vulcan Elements represents a significant step toward achieving that goal, but the circumstances surrounding its award will undoubtedly remain a topic of discussion.

Reader question: – Do you think venture capital firms with ties to political figures should be allowed to bid on government contracts? What safeguards, if any, should be in place?

Why: The U.S. Department of Defense awarded a $620 million contract to Vulcan Elements, a rare-earth magnet startup, to bolster the domestic supply chain for critical magnets and reduce reliance on foreign suppliers, particularly China.

Who: Vulcan Elements, backed by Donald Trump Jr.’s venture capital firm 1789 Capital, secured the contract. ReElement Technologies is also involved in the broader $1.4 billion initiative. Key figures include Donald Trump Jr. and representatives from Vulcan Elements and 1789 Capital who have denied any conflict of interest.

What: The contract is the largest ever awarded by the Pentagon’s Office of Strategic Capital and aims to establish a domestic source for rare-earth magnets, essential for defense technologies.

How: The contract was awarded through