Cathal Mahon, DeepTech Lab Quantum

Cathal Mahon, Chief Business Officer of DeepTech Lab Quantum, Denmark. Cathal describes the lab’s initial program, part of the NATO-initiated DIANA initiative, which concentrates on startups in secure information sharing, sensing, and surveillance. He discusses the emphasis on the intersection of quantum technology and life sciences, reflecting Denmark’s strengths in these fields, future goals, and much more.

Full Transcript

Yuval Boger: Hello Cathal, and thank you for joining me today.

Cathal Mahon: My pleasure, Yuval. Thank you for having me.

Yuval: So, who are you and what do you do?

Cathal: Yeah, so my name is Cathal Mahon, and my role right now is Chief Business Officer at DeepTech Lab Quantum. And DeepTech Lab Quantum is a new initiative in Denmark. It’s an accelerator that is specifically targeting quantum tech and quantum enabling tech startups.

Yuval: Are you focused on a particular branch of quantum, say computing or sensing or communication, or just any company? And related to that, is it just focused on the Danish ecosystem, or can any European or global company apply?

Cathal: Well, maybe I’d start off by answering that by saying that the very first program that we’re going to run is going to be as part of the DIANA initiative. This is the Defense Innovation Accelerator of the North Atlantic that has been initiated by NATO. And we have been selected among the five pilot accelerator sites that will be running the first cohorts here beginning next year. And actually, it was just announced today who those companies are. We have a focus on quantum technologies and only quantum technologies. So, all of the six companies that will be in our cohort are technology-based quantum startups. Four of them within the secure information sharing challenge and two of them within the sensing and surveillance challenge. So that’s the DIANA piece. 

That’s the first program we’re going to run, but we’re already in the process of setting up our own programs where the initial focus, and I say initial because the initial focus would be at the intersection of quantum technologies and life science. And the reason why we’re doing that is because we’re basically building on the back of the Bio-Innovation Institute, which is where we are housed. This is a life science incubator/accelerator that’s been in operation for around five, six years or so. They have a fantastic track record within life science, getting companies from Danish and also Northern European universities, basically translating the science and research from the labs into commercial companies. What we’re trying to do is basically combine that track record, that way of working with the strong base within quantum information science that Denmark has. So basically, at the intersection of those two, that’s where we’re going to be focusing first. But over time, we will expand and have a more general approach. And to answer your question regarding where we’re going to source, we’re going to source globally as well.

Yuval: If I have a young company and I’m considering applying to your accelerator, what does the accelerator give me other than, of course, office space and maybe a little bit of mentoring?

Cathal: Well, there are three cores. I mean BII, and this is the program that we are basically building our quantum version upon. BII focuses on three particular areas. They focus on the teams, they focus on the product market fit, so the commercialization side of things, and they also look at the technology development roadmap as well. And when I mentioned those three areas in that particular order, that is deliberate because the focus on the teams is a key component of our accelerator programs. Our thesis is that many companies, startups that fail, they don’t fail necessarily. What you can see they fail at is the technology. They can’t develop the technology, or they don’t find the correct product market fit. But in many cases, it’s the teams themselves that run into difficulties and then don’t function so well. So we put a lot of emphasis on helping the teams work well together because many of these teams, particularly in these kinds of deep tech areas, are very interdisciplinary. So there’s a lot of complexity. There’s a lot of kind of handovers between different areas, different people, different specializations.

And when in quantum, it’s not any easier. In many ways, it’s actually even more complicated because you don’t have the same well-defined kind of areas of expertise and you don’t have the same well-defined interfaces. So that’s one of the things that we focus on a lot. But in addition to that, there is also the usual suspects, as it were. We provide them access to investor networks, infrastructure, knowledge, and the usual suspects.

Yuval:  It’s very interesting that you mentioned the teams. Would I be correct in assuming that in quantum, it’s really often university professors or scientists who maybe this is their first venture into business as opposed to more experienced entrepreneurs who decide to go into quantum?

Cathal: It’s hard to generalize, but I think if you just look at the four or five, 600 startups or quantum tech startups that are out there, I think you will find that the vast majority of them are basically based on work coming out and teams coming out primarily out of universities. That is true. Although over time, this will mature as we have seen within the life science space as well. But right now, it’s very, very research or academic-based, very, very heavy on that side. And to be perfectly honest, it’s also departments, I mean, physics departments compared to some of, say within life science, I mean, a lot of the life science departments faculties, they already have an interaction with industry. They’re aware of the potential applications of their research. This is perhaps a little bit not as well developed in the context of physics departments and quantum. It’s changing, of course, but we’re at a relatively early stage in that process.

Yuval: If you think three years into the future, what does success look like for the DeepTech Lab Quantum, and what does success look like for the DIANA Incubator three years into the future?

Cathal: Okay. If we take a DeepTech Lab Quantum, one of the metrics that I have hanging up on my wall here is basically the success that the Bio Innovation Institute has had within the life science area. So basically, within a period of five years, they have put almost 100 companies through their programs. They have provided them with seed funding of the order of 80 million euros, but these companies have collected collectively five and a half times as much as that afterward in terms of private or public sector funding. So, that is the bar that I am thinking of and aiming for. It’s also a more immature space, so it’s probably not likely that we’re going to hit it, at least not initially, but that is what we’re targeting. So basically, three years from now, we should have put at least 40 or so, 30 to 40 companies through our program, and they should have attracted a substantial multiple in terms of public-private funding on top of what we have provided them in terms of our convertible loans. So that’s basically success for the DeepTech Lab Quantum. 

As far as DIANA is concerned, three years from now, we’re at full operational capacity. At that point in time, we will have at any given time 20 startups going through the programs that DIANA programs, and they will all be within Quantum. That is our focus, and that is our target to reach full operational capacity at 20 at any given time.

Yuval: I have a question on the DIANA accelerator. You mentioned it’s related to NATO. Does that also provide companies a testbed or preference to go and test their products in the NATO context or is it just funding and NATO said, “Well, we think that sensing is important, so let’s take a few sensing companies.

Cathal:  There’s a plethora of test sites as well as part of the DIANA network. There are, at this point in time, over 90 and counting, four of which are based in Denmark. But the whole idea is basically to access the full capability of the Alliance and all the test facilities that are available. But I think it’s also important to emphasize that the whole overarching objective of DIANA is basically to tap into the innovation that’s happening within these emerging and disruptive technologies in these early stage startups. The whole idea, as I said, is basically to tap into companies that don’t necessarily think in terms of defense and security as a potential market. The whole idea is to tap in there to provide an opportunity for these companies to investigate whether or not there is a fit. In that way, then, they can open up a new market. This is one of the key reasons why the NATO Innovation Fund has been established so that this is an investment vehicle for investing in these companies once they reach a certain stage. Obviously, NATO Innovation Fund will syndicate with other for-profit corporate and strategic investors. The third component, of course, is this rapid procurement process. That is really, really key for the success of the whole DIANA initiative. It’s very important that these companies have easy access to engage with defense and security customers because they’re already operating within the civilian sector. And if they don’t have timelines that are comparable with their civilian sector customers, then that will be a barrier to engaging with the defense and security market.

Yuval: Tell me a little bit about the Danish ecosystem. As we go around Europe, I think we have several extremes. You have Germany, where there’s a large amount of government funding, but perhaps not a lot of private funding. On the other side, there’s Switzerland where the national program is quite small, but there’s significant private quantum funding. Where does Denmark fit on that scale?

Cathal: Well, Denmark is maybe even another kind of special combination as far as funding is concerned. The Danish government actually, as recently as this year, published their two-part quantum strategy. Part one focuses on research and innovation. Part two focuses more on the translation and commercialization aspects. The total funding that was made available was almost 200 million euros over a period of five years. So that’s in the public sector context. 

In the private sector context, then in Denmark, there’s the Novo Nordisk Foundation, which has taken a strategic position within the physical sciences in general, but within the field of quantum technologies in particular. The Novo Nordisk Foundation is a philanthropic organization with commercial interest, has sponsored basic research within life science for many decades now, and more recently has begun to expand or extend that to the physical sciences, in particular data science, but also quantum science. At the same time, they have also started, in addition to the basic research funding, funding translational research programs and mission-driven programs, and perhaps the most visible example of that is the Novo Nordisk quantum computing program. This is a 12-year program to develop, to build a fault-tolerant quantum computer that can solve a problem of commercial interest and relevance within life science by 2034. That is the stated mission. In the first phase, 200 million euros has already been allocated, and in the first five years, three modalities will be explored from the perspective of their suitability for scaling up to a full-scale quantum computer. That’s just one example of how the Novo Nordisk Foundation is also stimulating activities within the Danish ecosystem in many ways. As I said, there are also other programs that they have initiated, challenges that they have had. There’s also the Quantum for Life program. There are a lot of programs that are focused on the translational aspect, and that has particularly been the case within the last three to four years or so. That’s an interesting mix that you don’t see in too many other countries. Perhaps in Sweden, you have the Wallenberg Foundation, which have also gone in and supported quantum computing programs. In Denmark, there’s no doubt that this synergetic collaboration between the Novo Nordisk Foundation and the Danish government is very beneficial for the Danish ecosystem in quantum.

Yuval: Maybe I should have asked that at the beginning, but could you tell me a little bit about your background and how you got involved in these programs?

Cathal: Well, my background is actually background in physics and in engineering, and in the context of quantum or practical quantum applications, that’s actually, I find, a very useful combination because it gives me an understanding of the physics and how the physicists think. It also gives me an understanding of the engineering challenges and how engineers think as well. My background is primarily within telecommunications and optics, fiber-based communication systems. I spent most of my career working in that area. More recently, I was part of an early-stage deep tech startup until about seven years ago, where I basically started hearing more about what was happening at the University of Copenhagen within quantum and basically started engaging with the programs that were operational at that time and have since then basically been in one way or other working in this field, doing what I can to try and get companies established based on research at Danish universities.

Yuval: Life sciences is indeed one of the key areas in which quantum will bring a big advantage, but it’s definitely not the only one. There’s optimization work. There’s machine learning. There are other topics. To what extent is the focus truly and exclusively on life sciences?

Cathal: If you’re talking about the context of deep tech lab quantum, our initial focus will be in that area. Deep tech lab quantum is under the auspices of the Bio-Innovation Foundation, which is also under the auspices of the Novo Nordisk Foundation. The focus is naturally within life science, but we expect to see this evolve over time. Maybe I could also just add an extra comment regarding the focus on life science and computing. There’s also a very interesting area within the field of quantum sensing within life science. There’s certainly, at least in Denmark, there is a lot of activity in the optical magnetometers and in the centers that have very interesting applications within life science, within, for example, magneto cardiography, just to mention one area. These are areas that we are also looking at as well because they’re quantum based and they also have an application within life science.

Yuval: Professionally speaking, what keeps you up at night?

Cathal: We have a cohort coming in on January 10th. Right now, that’s what keeps me up at night because we’re in the process of. It was announced today, but we’ve been in contact with the six companies here over the past two weeks doing a virtual onboarding. We’re in the process of getting ready to receive them when they come in here on January 10th. Right now, that’s what keeps me a little bit awake at night, though not too much, because there’s a great team here, both in DeepTech Lab and at the Bio-Innovation Institute. I’m sure that we’ll get all the pieces together at the right time.

Yuval: Can you tell me a little bit about these six companies, or is it too early to talk about them?

Cathal: The information has been made public today, but as I said, initially, four of them are within the field of secure information sharing, two of them within the field of sensing and surveillance. So we take the sensing and surveillance first; one of them is a sensing based on the cold atoms, gravimeters, and the other one is basically quantum LIDAR, a variation of quantum LIDAR. That’s within the sensing area. The four others are within secure information sharing. So it’s two QKD-based companies, another one looking at the implementation of RISC processors for PQC implementation. And the final one is a quantum random number generator company. So it’s relatively broad, but the common denominator, at least in our case, is the quantum aspect. And maybe I should also add as well that all these companies, in addition, they’re dual use tech. Quantum is a dual-use technology, but these companies also have a civilian market for their products, as well as a potential defense and security application market. The objective is not just to explore the defense and security market opportunity but also to help the companies grow as a company in general, also their civilian market because this is the only way you’re going to have a robust ecosystem within each of these nine emerging and disruptive technologies. If you ensure that these companies can stand on their own two feet in their civilian markets as well.

Yuval: As we get close to the end of our conversation today, I’m curious: what kind of collaborations or help are you looking for from other members of the quantum ecosystem, the global quantum ecosystem?

Cathal: I mean, in the context. If I just take in the context of DIANA, as I mentioned before, there’s a whole load of test sites that we really want to engage within this. And then, at a certain point, there will be other accelerators that will also be addressing startups based on quantum technologies. As I said, we focus exclusively on that, but for those other accelerators that come online that have a quantum technology component, we really want to collaborate with them. In the context of our own programs with our particular focus on life science and quantum information science, then we are really, really interested in collaborating with other accelerators that are actually kind of thinking of that kind of combination as well. 

Our thesis is that there are very few places in the world where you have a strong quantum information science and a strong life science community ecosystem. And we’d be very interested in collaborating with other areas with that same focus. I mean, obviously, the Boston area in the US is one area that kind of meets that criteria, but also Basel, QAI Ventures in Basel is another area. So that’s this particular kind of collaboration opportunities we’re looking at this time.

Yuval: And last, a hypothetical question: if you could have dinner with one of the quantum greats, dead or alive, who would that person be?

Cathal: Richard Feynman. I think, I mean, in many ways, he’s made a huge impact on all kinds of areas, but I mean, he was the guy that kind of essentially kind of way, way back there kind of said, nature is quantum mechanical. So if you wanted, you need to use a quantum mechanical computer to basically compute, calculate within that area. So yeah, Richard Feynman.

Yuval: And actually one really last question. Probably should have asked it before as well. In AI, people think about the chat GPT moment, the moment that AI became semi-ubiquitous and seemed to impact so many different fields. What do you think is going to be the quantum GPT moment? And how soon would you estimate that will be?

Cathal: So there are many opinions on that, and this is just my own personal opinion. I just want to emphasize that, but my own personal opinion is when you reach the stage where you have a significant number of logical qubits working together properly. So it’s not just one logical qubit, but it’s actually a handful, a significant number. What that number is, I don’t want to speculate, but it has to be a demonstration of dealing with the complexity of getting logical qubits to work together. That, in my mind, would be a huge watershed moment.

Yuval: Wonderful. Cathal, thank you so much for joining me today.

Cathal: My pleasure, Yuval. Thank you for having me.