Venture Capital Firms have existed for years and have financed and aided the launch of billion-dollar industries that have changed the world. These venture capital firms, incubators, and accelerator programs succeed by pitching their tents in the next innovative, disruptive industries that are shaping up to change the world, and right now, the Quantum Technology industry is exactly that. This article explores the top Venture Capital Firms, Incubators and Accelerators supporting the rise of this ground-breaking industry.
Quantonation (Venture Capital Firm)
The quantum industry’s boom having been declared imminent; one VC startup has positioned itself as the trendsetter in investing in Quantum Technology firms, claiming to be the first of its kind, which invests solely in Quantum Technology start-ups since they began operations in 2018. According to the founder and managing partner of Quantonation, Cristopher Jurczak, the VC’s goal is to help these startups with not just research funding, but also in areas like technology and training. Jurczak expressed Quantonation’s belief that the Quantum Technology industry in Europe will begin to produce real-life results and commercial benefits over the next few years.
Quantonation has an impressive seventeen quantum technology startups on its portfolio, boasting 70 million Euros worth of assets under management. Seven of the startups in their portfolio are in the quantum computing subindustry, two in Deep physics, two in quantum sensing, and four in the quantum network phase. These companies span across Europe and North America, with one in Canada, one in the US, and the rest in European countries like the Netherlands, UK, Germany, and others.
In real disruptive nature, these companies are developing ground-breaking products that could harness the value in their industries that were simply not a possibility before this new wave of Quantum Technology, and it’s all funded by VC firms like Quantonation. One of such is the most recent addition to the Quantonation portfolio Nord Quantique, a Canadian Quantum Computing startup looking to create completely fault-tolerant quantum computing through processor redesign from the bottom up with a goal of low error. Having raised over 7.5 million US Dollars in their most recent funding round, of which Quantonation was one of the leading investors, they’re on track to do just that.
At the end of January 2022, Quantum Zeitgeist named Qauntonation’s Cristopher Jurczak as one of the twenty most influential people driving the Quantum Technology revolution and referred to him as “the leading venture capital investor” in the quantum technology space.
Creative Disruptive Labs (Accelerator)
The next disruptive quantum technology financier on our list operates a different form of business model from the first. Creative Disruptive Labs (CDL), founded in 2012, is a nonprofit innovation incubator and accelerator aimed at providing more than just funding support to innovative startups, but also access to mentorship and much-needed non-financial support to scale their businesses.
CDL is a primarily Canadian firm that runs in collaboration with universities across North America. Quantum is only one of the streams that CDL offers which operates out of their Toronto base. Their quantum stream focuses solely on innovative startups in the Quantum computing niche. They focus on bringing the companies that make it into their program in contact with scientists, mentors, and investors to help with scaling, whilst CDL itself does not take any equity in these companies. On the list of Quantum stream mentors is Quantonation’s Cristopher Jurczak amongst other notable names.
CDL Toronto boasts quite a few successful graduates from their nine-month program including Kuano, a London Headquartered artificial intelligence company using Quantum technology to develop simulation software for pharmaceuticals. Their software models enzyme inhibitors using quantum technology and is a rapid cost-effective solution. Kuano finished the CDL program in June 2021, and by the end of the program, raised 1 million Pounds in seed funding.
According to an article by GlobalNewswire on CDL in 2021, within a decade of CDL’s existence, they had provided support to raise an impressive 15 billion US dollars in equity to their program enrollees.
CDL brands itself a technology-first organization, assessing potential enrollees in their program based on the innovative strength of their technology as well as the scalability of these startups and the business acumen of the founders. The acceptance rate of most of the CDL campuses in 10 locations globally sits between 9 and 15 percent.
IP Group (Venture Capital Firm)
IP Group is a United Kingdom-based Venture Capital firm founded in 2001 with an aim to “evolve great ideas into world-changing businesses.” The firm is branded as an intellectual property commercialization company.
In August 2020, IP Group set up a quantum accelerator program with 12 million pounds in funding, calling for quantum innovators in the United Kingdom to apply to the program. The program is slated to run until May 2022 or until the funding is exhausted and is run in partnership with Innovate UK, a part of the UK government’s research and innovation arm.
The IP Group’s Quantum portfolio investment director, Dr. Manjari Chandran-Ramesh expressed the Group’s confidence in the potential of the Quantum technology sector. Chandran-Ramesh was quoted in a 2020 article as having called Quantum technologies the most theoretically powerful way to perform computations and a cutting-edge field.
“Quantum Technologies are theoretically the most powerful way to perform computations and this cutting-edge field has been an area of interest to IP Group for many years. In the last decade, key technical progress has meant that the field is ready for commercial ventures to bring the technologies out of the lab and towards the mainstream.”
Dr. Manjari Chadran-Ramesh
Products and companies eligible to apply for part of that 12-million-pound funding base must be in one of four quantum technology subcategories: Connectivity; Situational awareness; Imaging and Sensing; and lastly, Computing. Applicants go through three stages of approval before funding is awarded, including an initial suitability check, approval from an investment committee, and an Innovate UK application.
The Quantum Technology Enterprise Center by the University of Bristol (Incubator)
In 2016, the University of Bristol created the Quantum Technology Enterprise Center (QTEC) with funding from Engineering and Physical Science Research Council (EPSRC). QTEC is described as a world-leading pre-incubator program aimed at creating a safe space for quantum technology innovators to study the scientific and commercial viability of their products.
QTEC consists of a team of 53 total contributors and 23 mentors. At the helm of affairs is QTEC director, Noah Linden, a professor of theoretical physics at the University of Bristol, with over 5 Quantum technology research projects under his belt and over 91 published articles in his field.
QTEC offers a training program that allows its beneficiaries to acquire the necessary skills to survive as technology entrepreneurs led by expert mentors in the quantum technology field. In 2020, QTEC hosted an investor showcase, giving the quantum technology community a look into how the program helps startups. The program has supported over 27 companies since its inception, aiding them in raising over 56 million pounds in equity.
One of its innovative alumni is Zero Point Motion founder, Lia Li. The company’s technology is looking to disrupt the positioning and tracking industry with quantum technology-based solutions that are more accurate than the technology that currently exists. The technology that zero-point motion is developing hopes to be able to sense motion with 10,000x more precision than currently available technology and would have applications in the navigation and positioning industry, structural monitoring, and stabilization industry, and in the health care industry for health monitoring. To date, Zero Point Motion has secured over 600,000 pounds in equity.
IBM Incubator (Incubator)
IBM created the IBM Quantum network to give promising Quantum technology startups and entrepreneurs access to superior technology with higher qubit counts as well as to a community of other professionals in the Quantum Technology industry.
Focusing mainly on quantum computing, the IBM quantum network aims to be the leading incubator for startups and entrepreneurs in the field. Working with what the program calls ‘startup partners,’ the program aims to take quantum computing technology from the lab to the commercial sector and push the field of quantum computing forward in leaps.
One proud beneficiary of the IBM quantum technology incubator is Super.Tech which the program enabled to launch SuperstaQ. According to Super.Tech co-founder, Fred Chong, leveraging on the access to IBM researchers and superior IBM quantum technology paved the way for the launch of SuperstaQ, an innovative hardware-agnostic software platform for connecting applications to quantum computers from IBM quantum, IonQ, as well as Rigetti. Super.Tech’s product aims to make quantum computing a commercially viable field years sooner than the quantum community has projected.
“The Quantum Network has provided us access to IBM Researchers, as well as advanced features of the systems that aren’t available from other platforms”
Fred Chong, Co-founder, Super.Tech.
Access to IBM’s record-breaking quantum technology and IBM researchers could catapult quantum technology startups into greater commercial and technological success according to IBM because members are able to create software solutions that are hardware-aware for faster code execution time or qubit error migration.
Duality (Accelerator)
Duality is the first American accelerator program that is solely dedicated to quantum technology startups launched in 2021. Duality was created by the Polsky Center for Entrepreneurship and Innovation in conjunction with the Chicago Quantum exchange. Like most accelerator programs, Duality aims to act as a bridge between the lab and the marketplace for startups in the quantum technology space. At the helm of affairs at Duality is Chuck Vallurupalli, a business executive with over 20 years of experience working with and scaling startups.
Duality was launched with an expected 20-million-dollar investment over the next ten years from its wide partner ecosystem ranging from academic to corporate partners. Among the founding partners of Duality are P33, Argonne National Laboratory, and the University of Illinois Urbana-Champaign.
Duality is offering startups a 12-month program by offering them access to state-of-the-art facilities, offices, laboratories, and 50,000 US Dollars in unrestricted funds. The first cohort of the program began in July 2021.
The Polsky center already had a proven track record of launching startups and their innovative ideas into viable markets and is expected to do the same with startups in the quantum technology field. The inaugural cohort took in six startups including Axion Technologies, Great Lakes Crystal Technologies, qBraid, Qauntopticon, and earlier mentioned member of the IBM Quantum Network, Super.Tech.
Vector Institute (Incubator)
Like CDL, the Vector Institute is a not-for-profit organization. It was launched in 2017 with both government support from the Canadian government and the Ontario government, and private industry support. Its aim is to advance Artificial Intelligence research as well as AI application, adoption, and commercialization across Canada. The way that Vector Institute is structured is to collaborate with partner universities like the University of Toronto in working with startups, incubators, and accelerators to advance Artificial intelligence research.
Among the fields of AI research that the Vector Institute supports is the field of quantum technology. Members of the Vector Institute have varying research interests which the institute supports, among which include Quantum Technology.
The first company to have been spun out of the Vector Institute is a quantum technology company, yiyaniQ, founded by Estelle Inack, an alumnus of the Vector Institute programs. The company’s technology makes use of a neural network to get more accurate and quicker derivative pricing calculations which acts as a solution to one of the financial industry’s biggest problems.
University College London Quantum Science and Technology Institute (Incubator)
UCL, one of the top schools in the United Kingdom boasts its own institute of Quantum science and technology aimed at creating a community for those in the quantum science industry as well as providing a platform for collaborative research.
The institute was founded in 2014, and although much of its focus is on the research aspect of the quantum technology industry, its UCLQ and Industry program facilitates the launch of quantum science and technology startups into commercially viable ventures.
In a demonstration of how startups can leverage not just one of these Venture Capital Firms, incubators, and accelerator programs, but multiple at once or at different stages of their growth, Zero Point Motion, a beneficiary of QTEC, is also one of the top members of the UCLQ community.
Blackrock and Psiquantum
In a recent demonstration of just how much buzz the quantum technology industry is generating, Psiquantum, a quantum computing company secured 450 million US Dollars in funding in 2021, with the leading investor being the Private Equity Firm Blackrock.
Psiquantum is a quantum computing company that was founded in 2016, with a goal to create the world’s first commercially viable, general-purpose quantum computer. The company is focused on creating a quantum computer that is fault-tolerant with manufacturing processes that are proven and scalable.
Airbus Quantum Computing Challenge
Airbus launched a quantum computing challenge in 2019 where the company came out with a flight physics challenge and called for global submissions from the quantum computing community to solve this challenge. In 2020, the team Machine Learning Reply emerged as the winners of the competition.
Airbus’ challenge could be a model for more of this type of competition to spring up in the future by big companies that aim to benefit from the solutions that the quantum technology industry has to offer.
Conclusion
Other notable VC firms in the quantum technology industry include the Waterloo Region Economic Development Corporation, and ZAZ ventures.
The funding environment for the quantum technology industry is still nascent, however, the interest of investors in the industry continues to grow. For instance the earlier mentioned investment of Private Equity giant, Blackrock, in a quantum computing firm. As the industry develops and entrepreneurs are able to present more proof of commercial viability, more funding will become available.
In general, the entire ecosystem that enables quantum technology firms to go from ideation to properly funded companies has been and continues to develop over time. This ecosystem includes incubators, accelerators, government-funded institutes, and more.