Recession proof your quantum ventures
An action oriented strategy for investors to grow quantum ventures in their portfolio
Quantum Tech for executives and investors
This newsletter’s long take focus on a framework I developed to help Quantum Tech investors quickly stabilize and grow their Quantum portfolio holdings during the current crisis
The short take shares the most recent quantum news from the past week
The fan favorite SciFi section takes a peek into the multiverse
Paying members can access our weekly Quantum deal flow and data digest here
Also check out our investment opportunities in quantum write up
Dr Henry Yang and Professor Andrew Dzurak device a new way to operate qubits at temperatures 15 times higher than the current, absolute zero degrees required
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The long take
Two weeks ago I published a framework to help quantum ventures large and small weather the current quantum winter. This has been met with a tremendous response - and need - which is why in this week’s long take I want to share it again, in more detail.
Investors especially, who have quantum ventures in their portfolio, have expressed a strong appetite to protect their investments - and our industry.
My goal is to offer a tactical strategy to fortify your quantum portfolio companies, lean them out for resiliency and focus on immediate growth opportunities. This framework is based on my 20 years of experience as a consultant and entrepreneur, as well as my MBA from the University of Chicago. More importantly, it is based on a lot of research and best practices from Bain, McKinsey, Harvard and many others.
Andre’s OJ pyramide is named after one of our quantum heros, Richard Feynman.
But also because
oranges are easy to get and affordable
making orange juice is simple and fast
everybody likes fresh OJ
In other words, the goal of my approach is not theoretical or long term, rather it is action oriented with a bias for easy and fast implementation to deliver results before your cash burn becomes too hot to handle.
The framework looks at the main angles of attack: strategy, operations, product, sales and marketing - and offers specific tasks within each of these levels. If executed promptly and honestly, your company will, without a doubt, out-compete everybody else within your space.
Let’s look at each step in more detail, and if you want even more of it, please reach out to me for a free consultation or the full decks and advisory.
Strategy - develop a simple yet clear business strategy to address the crisis and grow
CEO led project around macro trends: QIS applications need to transition from science to solution to survive this crisis, and to do that they need use cases. Build a task force to identify the macro trends, and opportunities, relevant for your company, to design and market your solution accordingly.
Competitive analysis - be sure to differentiate. Everybody has qubits, everybody is the best. That is not what customers buy - take a look at your ecosystem and help your customers make sense of it.
M&A - if you have the means, and we have started to see this happen over the last few days, this is a great time to acquire teams or companies to complement or extend your capabilities.
Operations - dedicate resources to conserve cash, communicate and build trust, go digital
Internal and external communications strategy - communication is your #1 priority right now. Communicate with your customers. Communicate with your investors. Communicate with your government. Communicate with your staff. Communicate with the community. Do it in an organized, systematic fashion.
Task force - dedicate resources to everything that needs to be done. Don’t just wing it.
Cost efficiencies - it is time to trim the fat off the bones. Tools, software, leases, T&E… any expense that is not directly value add has to go.
Lean and agile - as an organization you must operate on the best practices of lean and agile.
Digital workplace - have a strategy for your digital workplace beyond this current crisis and implement it.
Product - move from products in a quantum world to solutions in a digital world
Strategic roadmap - take the macro trends you identified above and translate them into a product roadmap. Stop building features and design solutions that the (future) market is demanding.
Digital customer - your customers will be more digital in how they use your solutions, how they buy them, how they interact with you. What does this mean for your product?
Build solutions for future problems - anticipate changes in the marketplace. If you’re still building to a roadmap and KPIs that pre-date March 15th of this year then you’re doing something wrong.
Sales - preserve and defend existing revenue at all costs, plan for future revenue and start to execute on it
Immediate plan of attack - upsell, cross sell, referrals, product extensions, tiered pricing, etc, etc
Superb customer service - protect your existing customers at all cost. This is your #1 sales job for the next few weeks.
Diversify sales channels, including digital - most rely on a direct sales model heavy on relationship selling. Start to look at partners, digital and other channels
Solution selling - stop pushing technology and product, device a strategy to offer solutions to your customers, follow a set process and make sure you’re in the cloud (somehow).
Customer onboarding and training - this is part of the closing deals, preempt questions, doubts and concerns, ensure renewals. Consider virtual options to achieve this.
Marketing - in times of uncertainty a good story is more important ever. People buy trust, not technology
Tell your story - what is your story? Is it unique? Authentic? How often do you tell it? On what channels? Who’s your audience?
Transparent, personal voice - authenticity is the #1 driver of success in marketing. Define and own this.
Scenario planning - nobody knows what our world will look like in 3, 6, 12 months. Plan for it now.
For executives interested in Quantum this means don’t let perfect stand in the way of better, get started. Now. And, finally, admit that customers don’t buy qubits but solutions, not tech stacks but trust and processes. You have to invest in those as much as you do into your quantum soft- and hardware.
For investors interested in Quantum you have a historic opportunity to support the quantum ventures in your portfolio to ensure they not only survive this quantum winter but strive throughout it. It is time for business to get an equal seat at the quantum venture table - impose that commercial rigor, we know how to do it.
For Quantum Executives
A lot of new research has been published over the last 10 days (this for example), indicating that we can expect more rapid advances in the near future, a good omen in dark times.
Our bet is that one of the large full stack vendors will make another announcement shortly, stay tuned for this exciting news…
More interestingly, we know of several quantum teams that have been signing customers such as the big deal between CQC and Total or smaller deals for highly focused startup teams in niche applications. Yes, even in a global pandemic there are customers for quantum applications.
Also, an interesting report by the Rand Corp on the urgent need to secure communications. Spoiler alert: if you haven’t started your quantum safe roadmap already it’s pretty much too late for you.
For Quantum Investors
The current pandemic and economic crisis seems to inspire a lot of investors, and the US government. Both have been very active to ensure the survival of some players that are considered strategic. While others emerge that have a route to market, which is clearer and shorter than the competition.
Seeqc (target)/M Capital (investor) $5M
ColdQuanta (target)/DARPA (investor) $7.4M
QC Ware France (target)/BPIFrance (investor) $undisclosed
Q-CTRL (target)/In-Q-Tel (investor) $undisclosed
Qunnect (target)/DoE (investor) $1.5M
The Quantum winter sure is damn cold for most but those who prepared for it are enjoying it fireside, bourbon in hand talking business with their customers.
Oh yeah, did we mention that PsiQuantum raised $215M! 🤯🤯🤯 You know why, right?
The SciFi corner
You probably have already heard about Devs, the new mini series on Hulu, or, binge watched it like I did… Tiger King, move over!
Devs is the story of fictional Silicon Valley company Amaya, which has developed a Quantum Computer with so many qubits that “mentioning their number would be insulting”. And, we can assume their coherence, gate speed and fidelity is just as impressive. At least, is has made Forest, Amaya’s CEO, wealthy like god and powerful to a point that the government is looking to take over his company.
But Forest has other plans. In a standalone building, enveloped by a Faraday cage, a golden shield and a full vacuum, his special unit, the Devs, are working on an a program to simulate any point in time - past or future, in fact, creating a reality of the multiverse. Their breakthrough comes when Jesus first appears on their computer screens and talks to them.
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