UK Quantum Computing Firms Threaten to Move Investments Overseas if Tech Funding is Cut

A prominent quantum computing startup based in the UK has raised concerns about the recent decision by the new Labour government to shelve £1.3 billion of technology and AI funding that had been pledged by the previous Conservative administration. This decision could significantly impact startups in the tech sector, potentially leading them to relocate their operations and investment opportunities abroad.

The shelved funds were part of a broader strategy aimed at fostering technological and AI advancements in the UK. The move has sparked criticism from various industry stakeholders, including techUK, which has warned that the UK risks falling behind other nations that continue to invest heavily in tech innovations. The industry believes that maintaining and expanding funding is critical for sustaining the country’s competitive edge in the global tech landscape.

Ashley Montanaro, co-founder of Phasecraft, a leading quantum computing startup that has successfully raised £17.5 million in funding, has voiced concerns about the implications of the funding cut. He underscored the importance of stable and predictable funding for startups, noting that confidence in continued support is essential for long-term planning and growth. Montanaro highlighted that many companies in the quantum sector are exploring opportunities overseas where there is strong governmental and institutional backing for quantum research and development.

The former Conservative government had shown significant support for quantum computing, committing £2.5 billion over a decade to advance the field. This commitment was part of a comprehensive quantum strategy designed to position the UK as a global leader in quantum technology. Montanaro expressed his appreciation for the previous administration’s support, while remaining hopeful that the Labour government, despite the funding cuts, will continue to recognize the value of quantum technology.

Phasecraft, established in 2019 as a spinout from University College London and the University of Bristol, recently expanded its operations by opening an office in Washington, DC. This move was part of a strategic effort to tap into the vibrant quantum computing ecosystem in the US. The company recruited Professor Steve Flammia, a distinguished figure in the field with a background at Amazon, to lead its US operations. The expansion has been met with strong interest, evidenced by the influx of over 50 job applications for specialized positions in quantum computing.

Montanaro highlighted that the US remains a pivotal center for quantum computing talent, which significantly influenced Phasecraft’s decision to establish an office there. This move aligns with the company's broader strategy to harness global expertise and capitalize on the robust opportunities available in the US quantum sector. By setting up operations in Washington DC and recruiting leading experts like Professor Steve Flammia, Phasecraft aims to strengthen its position in the industry and access a diverse pool of talent.

Looking ahead, Phasecraft plans to expand further internationally. The company is exploring the possibility of opening additional offices in Europe and Australia. This expansion is intended to enhance Phasecraft’s global footprint and leverage new markets, ensuring the company remains at the forefront of quantum technology development. By broadening its international presence, Phasecraft aims to foster innovation and drive advancements in quantum computing on a global scale.