Nuclear AI startup Fermi loses CEO and CFO suddenly — Texas project in question

Fermi, a startup determined to build nuclear power plants to fuel AI data centers, has lost two key executives — its CEO and CFO — simultaneously and unexpectedly, casting doubt on the company's ambitious AI campus project in Texas. Fermi was founded with the involvement of Rick Perry, former Texas governor and US Energy Secretary under the Trump administration. The premise was that nuclear energy would address the rapidly growing power demands of the AI industry: large data centers require gigawatts of stable electricity, and coal and gas plants don't align with the climate goals of tech giants.

The idea surfaced at the right time and place. Nuclear energy is experiencing a global renaissance precisely because of the AI boom: Microsoft signed a contract to restart the Three Mile Island reactor, Google is investing in small modular reactors, Amazon is striking deals with energy operators. Against this backdrop, a startup with a former energy secretary among its founders looked like a strong bet for investors.

However, the company faced serious difficulties implementing its nuclear campus project in Texas. The state is the largest electricity consumer in the US, and its power grid, ERCOT, operates in isolation from the rest of the national grid. This creates specific risks — recall the February 2021 winter blackout — while also presenting opportunities: Texas actively attracts data centers thanks to cheap land and a business-friendly climate.

The simultaneous departure of the CEO and CFO is a serious signal to investors and partners. The CFO is responsible for capital raising, which is essential for building nuclear infrastructure — one of the most capital-intensive sectors in energy. The CEO sets strategic direction and maintains relationships with regulators.

The loss of both simultaneously typically signals either deep corporate conflict, a shift in investment strategy, or a radical rethinking of the business model. Fermi did not disclose the reasons for the resignations or announce successors. For the nuclear energy for AI market, this episode is another reminder of how vast the gap is between an ambitious idea and the actual construction of a nuclear power plant.

Regulatory approvals in the US take years; reactor construction takes decades. Small modular reactors, which most new players are banking on, exist largely as projects on paper. NuScale Power — the first US company to receive SMR approval from the Nuclear Regulatory Commission — cancelled its first project in 2023 due to rising costs.

This is why large tech companies prefer to negotiate with existing nuclear plant operators rather than build from scratch. Google, Microsoft, and Amazon are taking this route — through long-term electricity purchase agreements, not by creating their own nuclear startups. The sudden double departure of top management is not just a staffing story.

It's a signal that the gap between nuclear ambitions and operational reality remains painfully large even for well-connected startups with prominent names among their founders. What will happen to Fermi next remains unclear, but investors in the nuclear energy for AI sector have received another reminder: in this business, a stellar roster of founders is not enough.