Scientists and engineers are still toiling in labs in a race to develop quantum computers that would significantly outperform traditional computers.
But that isn’t holding venture capitalists back. They’re pouring record-high funding into work on computing power that is still considered years away from being ready.
Investors have invested $1.02 billion into quantum computing companies so far this year. That’s more than was funneled into the industry during the previous three years combined, according to PitchBook data.
Quantum computers, which store data in any combination of zeros and ones simultaneously, have the potential to one day facilitate tremendous breakthroughs in anything that requires complex calculations in fields like biotech, chemistry and logistics. But developing such machines may be the biggest technological challenge underwritten by investors today.
The ultimate goal for quantum computer hardware makers is to develop a machine that can solve problems that no traditional computer could. Achieving this so so-called quantum supremacy, depending on who you ask, could still be a decade or more in the future.
But investors are betting that some real-life applications will emerge a lot sooner.
“The data we are seeing says that as early as three and no more than five years away,” there will be use cases for quantum computers in industrial, financial or national security settings, said Matt Ocko, a managing partner and co-founder of venture capital firm DCVC, which invested in Rigetti. The Berkeley, Calif.-based startup has raised a total of $186 million, including a $79 million Series C led by Bessemer Venture Partners last year.
PsiQuantum said last year that it plans to build a full-scale quantum computer by 2025. The startup raised a $450 million Series D in July led by BlackRock, reaching a $3.15 billion valuation.
Unlike its competitors that may need to develop their chip-building facilities, PsiQuantum is producing early versions of quantum chips with the help of Global Foundries, one of the world’s largest semiconductor manufacturers.
IonQ, another contender in the race to build the first useful quantum computer, said in March that it plans to go public by merging with a SPAC at a valuation of $2 billion. The deal is expected to close later this year. In the meantime, SoftBank Vision Fund 2 has taken a “large,” but not the majority, stake in IonQ. The Japanese investor said it hopes to eventually use IonQ’s quantum computing capability to speed up calculations for some of its portfolio companies.
No matter which company gets there first, Ocko said he expects “early wins to be very impactful but transient” because conventional computers will likely be able to catch up to quantum technology’s computational power.
But the temporary advantage could be economically valuable, he said. He offered examples of drug or lithium battery development companies that could use quantum computers to beat their rivals and be the first to patent the technologies.
“Each next turn of quantum advantage is going to last longer, but I don’t see this big bang moment where all of a sudden only a quantum computer can design drugs,” Ocko said.
Meanwhile, startups like Zapata Computing and Cambridge Quantum Computing are raising funds for the development of quantum computer algorithms. Just last week, Israel-based Quantum Machines fetched a $50 million Series B for building cloud infrastructure and the software for quantum computers.
But since the quantum computing industry’s future is entirely dependent on the development of a fully functional machine, the VC-backed computer hardware developers will still need significant infusions of capital, Ocko said. “The numbers may look big and kind of scary,” he said, adding that these companies are relatively capital-efficient compared with what it took to develop mainframe computers.
Featured image via johnason/Getty Images
This is a syndicated post. Read the original post at Source link .