Toronto quantum computing startup Xanadu has secured $120 million CAD ($100 million USD) in a Series B round led by Bessemer Venture Partners.
The five-year-old company raised the capital to help accelerate the development of its photonic quantum computer, amid a global race to commercialize the technology.
“We believe this confidence [from our investors] is grounded in the significant advantages offered by photonics.”
As reported by The Globe and Mail, Bessemer, which has invested in the likes of Pinterest, Yelp, Shopify, and LinkedIn, comes as a new investor to Xanadu. The financing round also included Capricorn, Tiger Global, In-Q-Tel, and BDC through its $200 million deep tech fund. Georgian, OMERS, and American venture capitalist Tim Draper also made follow-on investments.
Prior to the Series B round, Xanadu’s total investment to date was $41 million following a round led by OMERS Ventures in 2019. The latest financing brings Xanadu’s total funding to approximately $176 million CAD ($145 million USD).
Xanadu was founded in 2016 by CEO Christian Weedbrook, with a mission of using photons, or particles of light, to perform exceptionally fast and complex computations at room temperature. The startup’s approach to quantum computing is what differentiates it from other major players in the space looking to commercialize their own technology. The race includes tech giants like Microsoft, Google, Intel, IBM, as well as Burnaby, British Columbia-based D-Wave Systems. While Xanadu is one of the most high-profile companies in the photonics space, other players include NTT Technologies, PsiQuantum, and IonQ.
It is expected quantum technology will be able to solve problems millions of times faster than a conventional computer and help with financial risk modelling, cybersecurity, drug discovery, and more.
Most recently, Google revealed plans to spend several billion dollars to build a quantum computer by 2029 that can perform large-scale business and scientific calculations without errors. Of late, others in the quantum race, such as IBM have announced planned milestones over the next few years.
“We believe this confidence [from our investors] is grounded in the significant advantages offered by photonics: the ability to leverage preexisting foundries and off-the-shelf optical components, and the capability to naturally network photonic chips together to form a larger quantum computer with one million qubits,” said Weedbrook.
The company said this latest financing will allow Xanadu to achieve its next major milestone: the building of a fault-tolerant quantum computing module.
“This fault-tolerant module is the size of a few conventional server racks and will be the key building block to reaching one millions qubits and to solving meaningful problems, leading to the opening up of a new global market,” said Weedbrook. “Photonics has the advantage that networking these modules together is achieved using light, which is already the medium of choice for our quantum computer”.
While the difficult race to commercialize quantum computers goes on, Xanadu says it has consistently doubled its qubit count over the past few years. The company has also made its quantum tech available over the Xanadu Cloud, which it touts as the world’s first photonic quantum cloud platform. Xanadu’s two open-source software products, PennyLane and Strawberry Fields, allow developers, customers, and scientific researchers to access computational tools to create new algorithms and design new products.
Xanadu is one among a number of Canadian startups playing a major role in the quantum computing space. Waterloo-based startup Quantum Benchmark works with a variety of global tech giants fighting the quantum race, including Google and IBM. The company’s software integrates and helps build quantum tech.
D-Wave is another Canadian quantum staple. It was the first company to offer a commercially available quantum computer and recently secured $40 million from the Government of Canada. Despite its more than 20 years of operation, the company has struggled to sustain operations in the face of increased competition from the likes of Google, Microsoft, Intel, and IBM, among others.