Quantum technology is in an interesting period. It’s being discussed more often, but outside of some tech circles, it’s not well understood.
What is quantum technology, where is it right now, and where is it headed? Is its future dominance of society guaranteed?
Anders Indset has some ideas. The deep tech investor is the founder and chair of Njordis Group and author of books on the intersection of exponential technologies and humanity.
Indset believes quantum is moving from scientific to economic impact, and this will cause progress to accelerate. 2025 will see Microsoft’s Majorana 1, Google’s Willow and Amazon’s Ocelot compete for prominence, while startups designing software and apps enabling full-stack development are already illustrating how these breakthroughs will change society as we know it.
One certainty is we are at the very early stages, with a long way to go. How should investors and tech enthusiasts prepare for the next decade?
Indset, who formed his outlook through years of research and conversations with scientists, philosophers, and CEOs, started with a foundation of the economy as society’s operating system. If any problem, such as climate change, is to be solved, that solution must synergize with a properly functioning economy.
Quantum computing is moving beyond the lab and into business
Quantum breakthroughs from Google, AWS, Nvidia and Microsoft show that quantum is spreading beyond academia and into business use cases. Indset believes this could accelerate the pace of change. Theorists might caution that there are still many issues to solve over a long period, but we’re on our way.
“Once you get all these large players to get all the money in, what you do is you attract the smartest minds,” Indset said. “The more people are not fighting for budget or applying for research grants every six months, they are working on solutions with some other great minds. They have almost infinite access to money, which leads to significant progress.
“When you get a stock-listed company that has to generate revenue, then you get creative, so you start to think about business use cases.”
One key factor in success is having the right solution in the right place at the right time. Investors and entrepreneurs recognize what components need to be in place for a technology to be maximized, and they either build those components or look for companies that are and invest in them.
With quantum, Indset said there are hardware and engineering challenges to be addressed. That takes time. Stakeholders must balance their excitement at tackling key problems which, when solved, will have a significant societal impact with the realization that solving them won’t happen overnight.
Once the quantum hardware is built, companies have to build the surrounding infrastructure so quantum can begin to tackle problems in finance, healthcare and community building. In the interim, Indset sees potential in hybrid computers, where companies outsource parts of a problem to a basic quantum computer. Portfolio optimization is a simple example.
Watch for companies developing more efficient ways to build quantum chips. With GPUs and CPUs becoming more efficient all the time, it increases the feasibility of tackling more complex problems. Combining quantum computing with these improved systems accelerates training and algorithm development.
Who has the early quantum advantage?
One clear sign of how early quantum computing is in its development is the many basic questions remaining to be answered. Indset said there are many different ways to build quantum computers that are still being tested.
Watch AWS, Amazon, Google, Microsoft and IBM for very practical reasons. Indset said they have the money to stay in the quantum derby for as long as is necessary, with a vision to match.
“They attract the smartest minds, and they can acquire promising labs or approaches,” he explained. “They have a lot of other core businesses that not only are very synergistic to the potential support of quantum computers, but also in terms of clients and scaling.
“Nvidia is participating in and taking equity in a lot of these projects, so they are an entrance point to a broader ecosystem. A company such as Honeywell that owns the majority of Quantinuum, which has focused on the middleware and the software at the front end of quantum…They are not stock-listed, but Honeywell is, and Honeywell is the major shareholder. So you can see a stable stock such as Honeywell having great potential for growth.”
Solving security issues is key to maximizing quantum’s impact
Strong security is a must if quantum computing is to safely scale. By definition, Indset said that anything with secured data faces imminent risk.
“If you believe that eventually there will be a quantum computer at scale, then any data today is insecure because a quantum computer would decrypt the current cryptography,” Indset said. “That means that any data that’s stolen today and stored away can instantaneously be opened up if there is a quantum computer.
“Here is a very irrelevant use case: How do you migrate data or implement post-quantum safe cryptographies?”
Security risks are everywhere as we prepare for a quantum future. The cryptography protecting many cryptocurrencies isn’t safe. If Bitcoin has to migrate to a new chain, Indset said it would have to shut down for months. Forking to a new chain introduces additional issues.
Every problem, including energy use, is solvable
Indset believes the energy use problem, even with fossil fuels, is solvable. Fossil fuels’ carbon footprint is an identified problem. That attracts capital to fund those developing cheaper energy.
“That is the highest form of competitiveness, which will drive efficiency,” Indset said. “The most efficient energy force will eventually win. Therefore, oil and gas will not be will not run out of it, they will just become obsolete, because sun or fusion, or other new forms of energy will be more efficient.”
He sees a day when whoever can produce the most efficient solar panels could have more energy than they need. Consumers bring their EVs there, charge their bi-directional car system, drive home and plug their house into the car.
“This technology exists today; it’s not something that is something that we need to figure out,” Indset said. “But why don’t we scale it? Because we have old grids. We have challenges with large distribution systems. Big corporations that are making a bunch of money don’t want to lose out, and therefore, it’s slower. We don’t have an energy problem, we have a source and distribution problem.”
“You could hold on to those gasoline cars out of nostalgia, but eventually they will not be competitive on technology or price. And why do you have 2,000 parts in an engine? It’s more expensive than 200 parts. The driving, the technology inside of it, the design, everything is better. And you can save 20,000 on a new car. Who would buy a diesel or gasoline-driven entity?”
Indset sees energy’s marginal cost possibly heading towards zero within two decades. A low cost of energy will bless the markets pushing for it today with a competitive advantage tomorrow. That will power cheap, self-sufficient data centres.
“They will be the leaders of this digital technological tsunami,” Indset said.