Venture with Grace
00:12:09 · Grace Gong, Juha Vartiainen
[00:12:09] S0: I think that's so interesting to think about. And you lead the IQM's government and policy engagement, including the NATO's Transatlantic Quantum Computers. And so I guess why do countries want to own their own quantum computers? So obviously, recently, there's a few deals that's happening, which is Spain's first quantum computer with Telefonica in Madrid. And then the first US system in Oak Ridge National Lab and Brazil's El Dorado Institute. So there's quite a few things going on. So why do countries want to own their own quantum computers? [00:13:00] S1: A lot has changed in international politics in past years. Let's say now many countries are evaluating very high idea of sovereignty. They want to have less dependencies on other countries, other companies. So therefore, they want to own the data. They want to own the processing like the servers. They want to have a full control. Let's say they want to be on the driver's seat when it comes to data processing. There are security concerns. There are concerns about the dependencies. So there are different models of deploying computing, especially quantum computing. The cloud model has been the very popular one. But let's say this on premise model where you own, you build and accumulate your know how to your organization in your own country, that has become increasingly popular. And that's more the question, who is owning, who is operating the data centers where your data is processed?
00:13:00 · Juha Vartiainen, Grace Gong
[00:13:00] S1: A lot has changed in international politics in past years. Let's say now many countries are evaluating very high idea of sovereignty. They want to have less dependencies on other countries, other companies. So therefore, they want to own the data. They want to own the processing like the servers. They want to have a full control. Let's say they want to be on the driver's seat when it comes to data processing. There are security concerns. There are concerns about the dependencies. So there are different models of deploying computing, especially quantum computing. The cloud model has been the very popular one. But let's say this on premise model where you own, you build and accumulate your know how to your organization in your own country, that has become increasingly popular. And that's more the question, who is owning, who is operating the data centers where your data is processed? [00:14:24] S0: For sure. So I guess I want to talk about the buyers of quantum computers because obviously recently you guys have raised Series C, which is, I believe, over 600,000,000. Correct me if... I think 300,000,000 in Series C, but together, it's a lot more. [00:14:44] S1: So that was actually our Series B. Now this summer, we got actually publicly listed. So that's our latest one. Yeah, [00:14:55] S0: sorry. I was just looking at the data. So I guess when you guys are selling the Quantum Computers, who is the official buyer? And would it be the government? Or would it be obviously you guys have a [00:15:11] S1: lot of
00:15:11 · Juha Vartiainen, Grace Gong
[00:15:11] S1: lot of [00:15:11] S0: strategic investors. How much does these things actually cost to build? And for each machine, how much can it power compared to regular machines?
00:15:27 · Juha Vartiainen
[00:15:27] S1: Yeah, this is actually a very complex field in that sense. So quantum computing is mostly interesting for, let's say, public side customers in this point of time. We have actually the last three sales were for the private customers, enterprises to Japan, to Poland. But actually, most of our sales are for the public side and there are like three layers of customers. So actual demand comes very often from, let's say, scientists, engineers, innovators type of people. Those are the end customers. But usually they don't need to buy the quantum computing themselves, but they are usually associated to some, let's say, end user networks or some institutions. So we have usually some institutional, let's say, counterpart for signing the contract. So that could be HPC centers, high performance computing centers. That could be some research institutes, sometimes universities. So those are our actual customers for on premise quantum computers. But then for them, the business is more or less like hosting computers or servers. They're sometimes running a data center. But then, as I said, it's actually that they get their funding of the decisions from the government. So we to work also with the government. So that's very like a strategic decision to so we have to talk to the government, we have to talk to the data center, we have to talk to the end customers and convince all of them that it's like our offering is the winning one. But yeah, then there are public tenders often and so on. But that's more or less the structure of our customers. And we will see this is a relatively new field, and it's moving quickly. We have started to see this so called quantum advantage to come closer and more and more interest from private sector. Let's say companies are starting to put their own money on the table. They start to see ROI in some point, also quantum computing. So we hope to see more, let's say, private side customers, and it might be different there when that time comes.
00:18:04 · Grace Gong
[00:18:04] S0: So IQM has over €102,000,000 in the order backlog. And what about we could... If you can... I... Obviously, without giving, like, the particular customer information, but, like, how how is it kind of, like, structured? Would it be, like, It's like a fuel machine or like, does it like, do you... How do you guys charge basically? So like, obviously, I think like traditional... Obviously, there's like the machine. So like, do you guys charge services or usage? Like, how how is it different than, like, the current SaaS or current... Whether it's compute or, like, just SaaS kind of, like, model?
00:18:50 · Juha Vartiainen, Grace Gong
[00:18:50] S1: Right. So, yeah, it's a public information. We have sold close to 30 quantum computers and we have delivered close to 20. So we have pipeline about 10 quantum computers. And as you said, that's worth of about 100,000,000. So there are roughly like 10,000,000 projects, each of them. And we have some... We have different models. We have a model for research for education, which is, let's say, closer to 1,000,000. And then there are some, let's say, flagship models for data centers, which are more expensive. They usually come with some upgrade path. They might come with some educational package. They might have some service together with them. So let's say it's not like a bare hardware whose cost is that much, but it's like a package. Often that package is negotiated to the needs of each customer separately. Let's say, I think these profit margins are public information as well. I don't remember them by heart. Maybe November 5 is our next earnings call, so our CEO is probably telling about the latest profit margins. [00:20:13] S0: When... I guess, like, what would Quantum Computers, like, commercial value be? So, like, for example, I know that, you know, you guys and the Deutsche Bank demonstrated, like, a quantum algorithm for real way scheduling real operational data. Right? So this is kind of like the public information on your website, but maybe we could talk about what is a real life application side of things in... Or the commercial value of the-