Posted on 03/09/2021
The quantum computing industry is in its early stages and volatile. On March 7, 2021, dMY Technology Group, Inc. III, a SPAC, signed a deal to buy IonQ, Inc., a Delaware corporation. Founded in 2015, IonQ is based in College Park, Maryland and is a firm engaged in quantum computing. IonQ’s 32 qubit quantum computer claims it has the world’s most powerful quantum computer. IonQ was founded in 2015 by Chris Monroe and Jungsang Kim. IonQ believes that machine learning will be the first application area with widespread adoption of quantum computing.
Previous investors in IonQ include Mubadala Investment Company, Google Ventures (GV), Lockheed Martin, Bosch, Cambrium Capital, Osage University Partners, Hewlett Packard Enterprise, Tao, ACME, New Enterprise Associates (NEA), Amazon.com, Inc (AWS), Samsung, and Airbus. Total venture capital investment totaled US$ 84 million to date.
Series A round, 2017, US$ 20 million
Series B round, 2019, US$ 62 million approx.
In 2020, IonQ had zero revenue and a net loss of US$ 15,424,000. In 2019, IonQ had revenue of US$ 200,000 and a net loss of US$ 8,926,000. IonQ has a limited operating history, which makes it difficult to forecast our future results of operations. Licensing of intellectual property is of critical importance to IonQ’s business. For example, IonQ licenses patents (some of which are foundational patents) and other intellectual property from the University of Maryland and Duke University on an exclusive basis. In its filing, IonQ says, “IonQ has identified material weaknesses in its internal control over financial reporting.”
Sources of Funding
dMY Technology Group III shares: US$ 1,275 million
dMY Technology Group III cash held in trust: US$ 300 million
IonQ Cash (end of 2020): US$ 36 million
PIPE Investment: US$ 350 million
On March 7, 2021, PIPE investors include Hyundai Motor Company, KIA Motors Corporation, MSD Partners, L.P., Silver Lake Partners VI DE (AIV), L.P. and Breakthrough Energy Ventures II, L.P. PIPE Investors have collectively subscribed for 35,000,000 shares of Class A common stock for an aggregate purchase price equal to US$ 350,000,000. Other smaller investors in the PIPE include TIME Ventures (the investment fund for Marc Benioff), New Enterprise Associates, GV, and Mubadala Capital.
Morgan Stanley & Co. LLC is serving as the exclusive financial advisor to IonQ. Goldman Sachs & Co. LLC is serving as the exclusive financial advisor to dMY III. Goldman Sachs & Co. LLC and Morgan Stanley & Co. LLC are also acting as co-lead placement agents on the PIPE. Needham & Company also acted as placement agent on the PIPE. Cooley LLP and Cleary Gottlieb Steen & Hamilton LLP are representing IonQ and dMY III, respectively, as legal counsel.
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