Key Takeaways
- Canada is emerging as a significant player in the field of quantum computing, with the government investing heavily in developing a quantum computing ecosystem.
- The Canadian government has committed hundreds of millions of dollars to support Canadian firms in moving from prototyping to full-scale industrial-scale quantum computing systems.
- Four Canadian companies, including Anyon Systems, Nord Quantique, Photonic, and Xanadu Quantum, have been selected to receive funding as part of the Canadian Quantum Champions Program.
- Investors can consider large U.S. companies such as Alphabet, IBM, and Microsoft, which are already deeply invested in quantum computing, as a way to gain exposure to the field.
- Diversification remains essential for investors in the quantum computing space, as the industry is still in an early, experimental phase.
Introduction to Quantum Computing
Quantum computing is a computing method that uses quantum bits, or qubits, to process information. This approach differs from traditional computing models, which use a binary system of 1s and 0s to store data. Quantum computing introduces a third state, known as superposition, which allows each qubit to be a 0, 1, or both at the same time. This dramatically increases processing power and opens up new possibilities for applications. Companies pursuing quantum computing are approaching it from different angles, including hardware, software, and hyperscaling. Hyperscalers are large-scale cloud providers that house the massive data centers needed to support quantum workloads.
Canada’s Investment in Quantum Computing
The Canadian government has announced that it is investing heavily in developing a quantum computing ecosystem, with a goal of making it a national priority. As part of this strategy, the government has committed hundreds of millions of dollars over the next several years to support Canadian firms in moving from prototyping to full-scale industrial-scale quantum computing systems. One major initiative, known as the Canadian Quantum Champions Program, has earmarked up to $92 million in funding for its first phase. The goal of this program is to build systems that can tackle real-world workloads in areas such as materials modeling, secure communications, defense, and energy.
Canadian Quantum Companies
Four Canadian companies have been selected to receive funding as part of the Canadian Quantum Champions Program. These companies include Waterloo-based Anyon Systems, Sherbrooke-based Nord Quantique, Vancouver-based Photonic, and Toronto-based Xanadu Quantum. Each of these companies is eligible to receive approximately $23 million in funding. Xanadu is the only one of the four companies that is currently pursuing a path to become publicly traded, with plans to list on both the TSX and NASDAQ. This would make it the first publicly traded pure-play quantum computing company.
Investment Opportunities in Quantum Computing
For investors looking to gain exposure to the quantum computing space, there are several large U.S. companies that are already deeply invested in the field. These companies include Alphabet, IBM, and Microsoft. Alphabet is a global leader in quantum computing and fits squarely into the hyperscaler category. IBM operates one of the largest fleets of cloud-accessible quantum processors and continues to invest heavily in the field. Microsoft is concentrating on the software and cloud layers of quantum computing, connecting multiple hardware back-ends as an orchestrator through its Azure Quantum platform. These companies are already market leaders in their respective domains, and their investments in quantum computing are more evolutionary extensions of their core businesses.
Diversification and Investment Strategy
Quantum computing is still in an early, experimental phase, and significant investments are being made in data centers, hardware, and software development. Business models continue to evolve, and investors should approach the space with a diversified strategy. The three U.S.-based companies mentioned above are stellar options to consider in a well-diversified portfolio. Investors should also consider the potential for returns from other companies in the space, such as MercadoLibre, which has produced significant returns for investors in the past. By diversifying their investments and staying informed about the latest developments in the quantum computing space, investors can position themselves for potential long-term gains.
