White House aide rushes $620M Pentagon loan to a two-year-old startup

On November 3, 2025, Vulcan Elements, a North Carolina maker of rare-earth magnets, announced a $1.4 billion financing package anchored by a $620 million direct loan from the Pentagon's Office of Strategic Capital, plus $50 million in proposed Commerce Department incentives and $550 million in private capital. The Department of War formally announced the $620 million as a conditional loan commitment on November 21, alongside an $80 million loan to Vulcan's partner ReElement Technologies, funded through lending authority in the One Big Beautiful Bill Act. The government would receive warrants in Vulcan and a $50 million equity stake through the Commerce Department. The department said no funds are disbursed until Vulcan meets financial, legal, technical and due-diligence conditions. Vulcan was launched in 2023, had fewer than 50 employees, and had raised less than $10 million as of early 2025. In August 2025 it announced $65 million in new investment, including from 1789 Capital, the venture firm Donald Trump Jr. joined as a partner after his father's election; neither firm has disclosed the size of 1789's stake. ProPublica reported in May 2026, citing Defense Department records and interviews, that the loan was set in motion by a request from Peter Navarro, President Trump's senior counselor for trade and manufacturing and a close friend of Trump Jr. A Pentagon official said that of the dozens of companies under consideration, Vulcan's was the only deal initiated by a top aide to the president. Office staff learned of the request around September or October 2025 and, told it was a White House priority, completed in weeks a process that generally takes many months. "The call came from the White House: We have to get this done," one person involved said. A week before the announcement, Trump Jr. hosted Navarro on his streaming show, where he called him "my boy"; Trump Jr. had visited Navarro in prison, and Navarro dedicated a book in part to him. According to Bloomberg, estimates of Vulcan's valuation rose from about $200 million around the time 1789 first invested to about $2 billion. A spokesperson for Trump Jr. said he does not discuss his investments with federal officials and did not speak to Navarro about Vulcan. 1789 Capital said it played no role and did not know of the deal before it was public. The Pentagon said political connections "play absolutely no role" in its funding decisions, and the White House said its team was working "in the best interest of the American people." Navarro and Vulcan did not respond to ProPublica. Democratic senators demanded an accounting of how Vulcan was selected, and House Republicans blocked a Democratic attempt to subpoena Trump Jr. about the deal.