Paris-based VC firm Quantonation, which focuses solely on quantum startups, has closed its first fund, with €91m to deploy. It’s the first dedicated quantum fund in Europe.
Quantonation was founded over three years ago and has already made 19 investments — though they’ve come from an ad-hoc holding company rather than a fully formed investment vehicle. That’s because, the team says, quantum wasn’t such an obvious value proposition three years ago, and they wanted to build expertise before they raised a fund.
Now, however, the case for quantum is obvious. Quantum computing could create up to $850bn of value globally over the next 15-30 years, according to a recent report from the Boston Consulting Group, and investment into the sector has skyrocketed over the past two years.
What are they looking to back?
The new fund, Quantonation 1, will invest in early-stage quantum companies, from seed to Series A. It’ll put money into startups from all over the world.
The team says it’s after companies working on “fields such as molecular design, high-performance calculation, cybersecurity or ultra-precise sensing”, among other things.
Who have they backed previously?
Quantonation already has 19 companies in its portfolio and has secured two exits. A significant part of its deal sourcing comes out of universities — it’s backed spinouts from Oxford University, MIT and École Polytechnique.
“Our portfolio companies are finding alternatives to unsustainable computing paradigms, curing seemingly incurable diseases and providing the tools and systems to massively accelerate human innovation while consuming less energy,” says Quontonation.
Companies include those working on:
- quantum computing, like Pasqal and Orca;
- quantum networks, like Qunnect and Kets;
- quantum sensing, like Nami and Pixel Photonics;
- and deep physics, like InSpek and Light On.
“The multiplier effect of our first tickets is amazing,” says the team. Its portfolio companies have raised more than €100m in total, three times what Quantonation’s put in.
Can France’s quantum bet work?
France, where Quantonation is headquartered, has put a particular emphasis on the possibilities of quantum technology.
President Macron announced plans to spend €1.8bn on quantum tech by 2025 in order to make France one of the top countries in the field. More than €1bn will come from the country’s budget and the rest is expected to be provided through EU programmes, by corporates and by public and private investors.
“The French government feels that the country is suffering from a brain drain in AI and they don’t want that to happen with quantum,” Christophe Jurczak, founder and CEO of Quantonation, told Sifted last year.
France’s Fonds National d'Amorçage, managed by BpiFrance on behalf of the French state, has been strong on quantum tech investment, Jurczak added.
That said, the recent report from Boston Consulting Group warned that Europe risks falling behind the US and China on quantum innovation.