The landscape of the quantum start-up ecosystem

Quantum technologies (QT) have been rapidly emerging in the last several years and becoming a topic of interest for commercial actors. In this paper, we present a landscaping study with a gathered dataset of 441 companies from 42 countries that we identify as quantum start-ups.
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The second quantum revolution has been producing groundbreaking scientific and technological outputs since the early 2000s, however, there has been a sort of 'gold rush' [1] since the mid-2010s, and with the amount of realized or promised public funding reaching almost $30b by 2022 [2], commercialization of QT is quickly becoming not just a set of emerging technologies but of emerging new markets.

In this paper, we present a landscaping study with a gathered dataset of 441 companies from 42 countries that we identify as quantum start-ups and answer the following questions: (1) What are the temporal and geographical distributions of the quantum start-ups? (2) How can we categorize them, and how are these categories populated? (3) Are there any patterns that we can derive from empirical data on trends? We found that more than 92% of these companies have been founded within the last 10 years, and more than 50% of them are located in the US, the UK, and Canada. We categorized the QT start-ups into six fields: (i) complementary technologies, (ii) quantum computing (hardware), (iii) quantum computing (software/application/simulation), (iv) quantum cryptography/communication, (v) quantum sensing and metrology, and (vi) supporting companies, and analyzed the population of each field both for countries, and temporally. Finally, we argue that low levels of quantum start-up activity in a country might be an indicator of a national initiative to be adopted afterwards, which later sees both an increase in the number of start-ups, and a diversification of activity in different QT fields.

We advise the readers of our paper to take our findings with a grain of salt, as we discussed in our limitations section, our dataset (although highly representative) is not a complete list of quantum start-ups due to the emerging nature of the field. Furthermore, the definition of which start-ups can be accounted as 'quantum' depends partially on personal taste. A company dealing with quantum chemistry simulations that run on classical computers is not a quantum start-up, however, if they are also simultaneously exploring whether their simulations can run on quantum computers, then we counted them as such. This is particularly complicated when it comes to quantum sensing, where single photon detection devices such as SNSPDs and APDs have already been utilized by the established sensing industry before the emergence of QT markets and with the increased amount of funding, some companies just rebranded their work as 'quantum' sensing. Similarly, SQUIDs (superconducting quantum interference devices) have been around for the last half a century and they are generally accepted as an output of the first quantum revolution (similar to the transistor), meanwhile, there have been many improvements and an expansion of their potential applications with the recent wave of funding towards QT. 

Figure 1:  Number of new quantum start-ups per year.

In Fig. 1, the yearly distribution of new start-ups per year is given. In our dataset, it appears that the number of start-ups founded has increased sharply starting in 2013, peaked in 2018, and has been slightly declining ever since. In Fig. 2, the global distributions of these companies are provided. Though it might be important to keep in mind that our dataset does not cover stealth start-ups with zero visibility and might have a lower representation of start-ups from non-English speaking countries.

Number of quantum start-ups in countries.
Figure 2: Number of quantum start-ups in countries.

At this point, we would like to thank our reviewers because it was through one of their recommendations that we included a regional-level analysis, which can be seen in Fig. 3.

Figure 3: Total number of quantum start-ups founded in different regions.

Fig. 3 demonstrates the additional insights that can be gained by comparing regions instead of countries. Here, it can be seen that in terms of sheer numbers of companies the US, the EU-27, and the AU-CA-UK are operating on similar levels. Meanwhile, the rest of the world (ROTW) does not possess that many start-ups. This can be related to the limitations of our dataset, the fact that start-up culture is more adopted by certain regions, some other factors, or a combination of these.

Figure 4: Number of quantum start-ups in regions in different fields stacked.

Finally, in Fig. 4, we present the type of companies in different regions. It can be seen that the EU-27 has more supporting companies and start-ups focusing on complementary/enabling technologies and quantum cryptography/communication start-ups, while the US has a strong lead compared to the EU in quantum sensing and metrology, and quantum computing hardware start-ups. This figure shows that the adoption of different fields of QT varies on regional levels, however, all regions have a presence in all the fields of QT.

We covered several other aspects of the dataset and discussed on potential insights that these analyses can provide us with respect to the landscape of the quantum start-up ecosystem. As a descriptive study, we hope this work can act as a good foundational work for future studies. The dataset can be improved by adding further information on companies like their size, valuation, investment amounts, and other aspects. Similarly, each field deserves a more in-depth analysis of its dynamics, and some questions are raised here such as the effects of the emerging cohort of supporting companies, whether the start-up activity can actually be connected to following policy decisions (in the form of national initiatives or programs), and what are the path-dependencies that are currently being set which will limit the opportunity space of future development of the field. Start-ups are considered to be an important aspect of the emerging ecosystem of QT, and exploring such questions can lead to a better-informed understanding of further steps to be taken.

[1] Gibney E. Quantum gold rush: the private funding pouring into quantum start-ups. Nature. 2019 Oct 2; 574 (7776):22–4.

[2] Overview on quantum initiatives worldwide – update 2022 [Internet]. QURECA. 2022. Available from: https://qureca.com/overview-on-quantum-initiatives-worldwide-update-2022/

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