Our Quantum Computing Investment Thesis

Quantum computing is at an inflection point. After decades of theoretical promise, the hardware platforms being developed by leading quantum companies are beginning to demonstrate capabilities that classical computers cannot match for specific problem classes. We are actively investing in European quantum companies and believe the window for seed-stage investment in quantum hardware, software, and applications is open and unlikely to remain open for long. This article explains our thesis and where we are placing our bets.

The State of Quantum Computing in 2025

Quantum computing in 2025 occupies a unique position: far enough along to demonstrate genuine computational advantages for specific problems, but still far from the fault-tolerant, general-purpose quantum computers that appear in science fiction accounts of the technology. The honest assessment of where we are is that the quantum computing industry is in the early stages of the NISQ era — Noisy Intermediate-Scale Quantum — where devices with tens to hundreds of qubits are demonstrating real capabilities but also significant error rates that limit their applicability to problems that are tolerant of approximation.

The major hardware platforms in contention include superconducting qubits (pursued by IBM, Google, and European companies including IQM), trapped-ion qubits (pursued by IonQ, Quantinuum, and AQT in Austria), photonic qubits (pursued by PsiQuantum, Xanadu, and several European photonics companies), and neutral atom arrays (pursued by Atom Computing, Pasqal in France, and QuEra). Each platform has distinct tradeoffs in terms of qubit quality, connectivity, scalability, and operating requirements, and there is genuine scientific debate about which platform or platforms will dominate the fault-tolerant era.

What is less debated is the trajectory. Every major hardware platform has demonstrated steady improvement in qubit count, coherence time, and gate fidelity over the past several years. The fundamental physics supporting quantum advantage for specific problem classes is established. The question is not whether quantum computers will deliver commercial value — they will — but when, for which applications, and which companies will capture that value.

Where Quantum Advantage Will Arrive First

Our investment thesis is not predicated on a single timeline or a single hardware architecture. It is predicated on the identification of specific application areas where even near-term quantum devices — the imperfect, limited machines available today and in the next several years — can deliver commercially meaningful results. We see three categories of near-term quantum applications that are particularly compelling.

The first is quantum chemistry simulation. Classical computers struggle to accurately model the quantum mechanical behaviour of molecular systems with more than a few dozen electrons. This limitation is a major bottleneck in drug discovery, where understanding how a drug molecule binds to a biological target requires accurate quantum mechanical calculations, and in materials science, where designing novel catalysts, batteries, or superconductors requires understanding electron behaviour in complex materials. Quantum computers can, in principle, simulate these systems exponentially more efficiently than classical computers, and even NISQ devices are beginning to demonstrate meaningful simulation capabilities for small molecular systems. European pharmaceutical companies are already exploring quantum chemistry partnerships with quantum hardware providers, and we believe the first commercially deployed quantum applications will be in this domain.

The second is combinatorial optimisation. Many practically important problems — logistics routing, financial portfolio optimisation, supply chain scheduling — are formally NP-hard combinatorial optimisation problems for which quantum algorithms offer potential advantages. Quantum annealing devices from D-Wave and gate-based quantum approximation algorithms have demonstrated on specific problem instances that quantum approaches can find better solutions faster than classical optimisation methods. The commercial value in this category is clear: a logistics company that can optimise vehicle routing 10% more efficiently than its competitors gains a material cost advantage across its entire operations.

The third, and longest-term, is post-quantum cryptography and quantum key distribution. The eventual arrival of cryptographically relevant quantum computers — machines powerful enough to break RSA and elliptic curve encryption at scale — is driving a massive global investment in quantum-safe cryptographic infrastructure. European companies building quantum key distribution systems, quantum random number generators, and quantum-safe encryption tools are addressing an urgent and rapidly expanding market that is largely independent of the timeline for general-purpose quantum computing.

Why Europe Has a Structural Advantage in Quantum

Europe's position in quantum computing is stronger than most observers outside the European research community appreciate. The European quantum research ecosystem is one of the two or three strongest in the world — concentrated in institutions including the Max Planck Institute for Quantum Optics in Garching, the Institute for Quantum Optics and Quantum Information in Innsbruck, ETH Zurich's physics department, Delft University's quantum nanoscience group, and dozens of other leading research centres. Many of the world's most cited quantum computing researchers hold positions at European universities, and many of the algorithmic and hardware innovations that are driving the field forward originated in European laboratories.

European quantum hardware companies have translated this research excellence into competitive commercial offerings. IQM Quantum Computers, founded in Helsinki in 2018 and now employing over 300 people, builds superconducting quantum processors and has completed installations for national research agencies and private enterprise clients across Europe and Asia. Oxford Quantum Circuits in the UK has developed a 3D qubit architecture that it believes will scale more reliably than planar superconducting designs. Pasqal in Paris, spun out of the Institut d'Optique, is building neutral atom quantum computers and has announced cloud access to its systems for early commercial applications. AQT in Innsbruck, founded by researchers from the group of Nobel laureate Rainer Blatt, is commercialising trapped-ion quantum computing with a focus on enterprise and government applications.

The European Union has recognised quantum as a strategic priority through the Quantum Flagship programme, a ten-year, €1 billion initiative to advance European quantum technology research and commercialisation. National programmes in Germany, France, the Netherlands, the UK, and Austria have added further public investment, creating an environment where European quantum companies can access grant funding, government procurement contracts, and research partnerships that reduce their capital requirements and de-risk their technology development pathways.

The Quantum Software Opportunity

While much of the attention in quantum computing is focused on hardware, the software layer is an equally compelling investment opportunity — and, arguably, a more accessible one for seed-stage investment. Quantum software encompasses the algorithms, compilers, error mitigation techniques, and application frameworks that determine how effectively quantum hardware can be used for real problems. The quality of the software stack has a direct impact on the commercial utility of any quantum hardware platform, and the best quantum software companies will be hardware-agnostic, capturing value regardless of which hardware platform ultimately prevails.

We are particularly interested in quantum error mitigation software — tools that use classical post-processing to extract useful results from noisy quantum circuits, effectively extending the commercial utility of NISQ devices without requiring fault-tolerant hardware. We are also interested in quantum-classical hybrid algorithms, which combine classical machine learning with quantum subroutines to achieve computational advantages that neither approach can achieve alone. And we are watching the development of quantum application libraries closely — domain-specific tools that allow quantum chemists, financial engineers, or logistics optimisers to apply quantum algorithms to their problems without becoming quantum algorithm experts themselves.

Our Investment Criteria for Quantum Companies

Not all quantum companies are equal, and the field attracts a significant amount of investment that we believe is poorly allocated. We have developed a set of criteria that we apply systematically when evaluating quantum investment opportunities. First, we look for genuine technical leadership — founding teams with deep expertise in the specific hardware or software domain they are addressing, evidenced by peer-reviewed publications, patents, and the quality of the advisors and scientific collaborators they have attracted.

Second, we look for a clear commercial pathway that does not require fault-tolerant quantum computing as a prerequisite. Companies that are addressing near-term applications — quantum chemistry for drug discovery, combinatorial optimisation for logistics, quantum key distribution for cybersecurity — have paths to commercial traction that are visible and fundable today. Companies that are dependent on the arrival of fault-tolerant quantum computing for their entire value proposition are making a longer-term bet that requires patient capital and significant follow-on financing that may not be available on acceptable terms.

Third, we look for defensibility. The best quantum companies are building proprietary hardware, developing novel algorithms, or accumulating domain expertise that cannot be quickly replicated by a well-capitalised competitor. Pure software companies without a proprietary algorithm advantage face the risk of being displaced by IBM, Google, or open-source quantum software frameworks.

We are actively building our quantum portfolio and are in conversations with several early-stage European quantum companies. If you are building a quantum company in Europe and believe your work meets these criteria, we would love to hear from you.