Right now, quantum computing is perhaps the single most exciting development in the world of technology – so it is appropriate that the Global University Venturing 2021 Award for CVC Investment in a Spinout should go to M12 for its involvement in the $450m series D round for PsiQuantum, a US-based developer of quantum computing technology.

M12 is the corporate venture capital arm of software provider Microsoft and its first involvement with PsiQuantum came in April 2020, when it joined BlackRock, Playground Global, Atomico, Founders Fund and Redpoint Ventures in a $215m series C round. The series D, which took place in July this year, was again led by BlackRock and involved Baillie Gifford, Blackbird Ventures and Temasek, the Singaporean government’s investment firm.

PsiQuantum – whose mission statement is “building the first useful quantum computer” – was founded in 2016 by Jeremy O’Brien, Terry Rudolph, Pete Shadbolt and Mark Thompson, a team of academics from the UK and Australia who had been researching quantum computing and developing photonic quantum processors at Imperial College London and University of Bristol.

The firm’s series D round reportedly valued it at $3.15bn, which means that PsiQuantum is the first unicorn in the portfolio of Imec.xpand, the venture capital fund set up by research institute Imec. Imec.xpand is thought to have been involved in an early round of funding for the company worth $230m at the end of 2019.

At a very basic level, the aim of quantum computing is to solve highly complex calculations that are effectively beyond the capabilities of conventional computer. Speaking at the time of M12’s initial investment into PsiQuantum in 2020, managing director Samir Kumar said: “A quantum computer has the potential to unlock commercial value in scenarios where current compute power is the constraint. Such a machine would also foster a new wave of developments in quantum algorithms in chemistry, materials, and other domains.”

Kumar added: “While it is enticing to imagine the benefits and opportunities of a quantum computer, PsiQuantum is not distracted by what is beyond the finish line. They are disciplined and focused on the task at hand: delivering on a machine with hundreds of error-corrected, logical qubits.

“We at M12 have been impressed by the PsiQuantum team and look forward to their continued development.”

In the time between the series C and series D rounds, PsiQuantum made significant advances in the development of its 1 million qubit machine – most notably in reducing its physical footprint. A qubit is the quantum equivalent of a bit in conventional computing, and measures processing power.

Following the announcement of M12’s participation the series D round, Kumar said: “With over 70 PhDs on staff, a strong intellectual property portfolio and a mutual partnership with semiconductor manufacturing leader GlobalFoundries, PsiQuantum is well-positioned to fulfil their ambition: to deliver the world’s first fault tolerant quantum computer with one million physical qubits.”

The other nominees in this category were:

  • Deep Genomics, $180m series C (SoftBank Vision Fund 2, Alexandria Venture Investments)
  • Artios, $153m series C (M Ventures, Novartis Venture Fund and Pfizer Ventures)
  • Prime Medicine, $200m series B (GV)
  • Century Therapeutics, $160m series C (Leaps by Bayer)