TQI Exclusive: Main Sequence’s Latest Thesis Guides Quantum Bets on the Edge of Commercial Use

Insider Brief

• Main Sequence has launched a new investment thesis focused on full-stack quantum computing, committing up to $12 million across multiple startups while capping exposure at 5–6% of its fund.
• The strategy reflects growing commercial demand and confidence in hybrid quantum-classical systems, despite uncertainty around timelines for fault-tolerant quantum hardware.
• Portfolio bets span diverse qubit architectures and business models, with added emphasis on Australia’s research strengths in quantum sensing, timing, and commercialization.

Main Sequence Ventures believes quantum computing’s moment is near – and is investing boldly, but carefully – across architectures to prepare for the shift, according to its latest investment thesis on quantum.

Main Sequence, an Australian deep tech venture capital fund co-founded by CSIRO in 2017, has positioned itself uniquely by not just investing in quantum startups, but by co-founding companies and bridging the gap between academic research and commercial innovation. It has over $1 billion under management, with investments ranging from $100,000 to $10 million. Main Sequence has already backed quantum pioneers like Q-CTRL and Quantum Brilliance.

The latest thesis centers on small but strategic investments in full-stack quantum computing startups, according to Alex Romero, Associate at Main Sequence.

Romero said timing played a key role in the decision to back full-stack quantum efforts.

“We realized that we were ready to invest in full stack quantum computers,” Romero said. “We felt the timelines will fit within our fund life, which for deep tech funds is a little longer than generalist funds or private equity, and also because of the value creation prospects. So, we chose to invest, carefully, in small amounts and in different architectures.”

The firm is investing up to $12 million across two to three quantum computing companies. Main Sequence expects to limit its total exposure to quantum to around 5% to 6% of its current fund, a strategy that mirrors best practices for managing risk in deep tech portfolios.

The move reflects renewed confidence in the promise of quantum computers, particularly their potential to solve problems that today’s best supercomputers can’t handle.

“If we are to ever design better materials for something like improved battery densities, or simulate better drug design, or optimize pricing and portfolio construction, then we need more advanced tools,” the team writes in the thesis. “That’s where quantum computers come in.”

Still, Main Sequence acknowledges the considerable technical challenges that remain. Quantum machines today are fragile, noisy, and difficult to scale. Quantum bits—or qubits—are notoriously sensitive to their environment. Stray radiation, electrical interference, or even tiny vibrations can flip a qubit’s state and disrupt calculations. These limitations have kept the field in check.

Managing Quantum’s Uncertain Timeline

According to the firm, these technical hurdles make timelines for practical quantum applications uncertain. Main Sequence estimates that the industry is still five to twenty years away from a fully error-corrected, fault-tolerant quantum computer.

“We need to be careful as to what we understand about what’s going to be deployed and what’s going to be created,” Romero said. “Because, as you know, in quantum, there will likely be leaps and inflection points in the next five to ten years, and it’s maybe not going to be what people expect or what they’ve seen in other industries.”

Betting Across Architectures

Different companies are betting on different types of qubits. Google and IBM use superconducting loops. IonQ manipulates individual ions with lasers. Other startups are working with photons, neutral atoms, or electron spins. At this stage, no one knows which will scale best – and that’s one reason Main Sequence is spreading its bets.

While many of the barriers to quantum commercialization have remained constant, the firm says one thing has shifted in the past year: rising demand from real-world customers. Until recently, quantum hardware was largely confined to universities and national labs. Now, banks and pharmaceutical companies are actively exploring use cases, according to the thesis.

Goldman Sachs, JPMorgan Chase, Bank of America, and others are experimenting with quantum tools for pricing and risk modeling. Biotech firms like Moderna and Bayer have partnered to explore drug discovery.

Meanwhile, cloud platforms like AWS and Microsoft have become key access points. Rather than buying quantum machines, companies rent time on various systems. AWS offers access to quantum devices built by Oxford Quantum Circuits, IonQ, and QuEra. Microsoft connects users to machines built by Quantinuum, Rigetti, and others.

According to the thesis, quantum use cases fall into four main categories: simulation, optimization, machine learning, and encryption. In materials science and chemistry, quantum systems could simulate molecules and reactions with greater accuracy than classical systems. In logistics and finance, they could optimize routes, schedules, and portfolios. In artificial intelligence, quantum-enhanced models may detect patterns classical computers miss. In cybersecurity, quantum protocols could secure communications.

Main Sequence’s portfolio will span multiple architectures, business models, and technology maturity levels, with an eye toward systems that can work alongside classical supercomputers. Many near-term gains are expected to come from hybrid setups, where a quantum processor handles a narrow task within a larger classical workflow.

Don’t Overlook Sensing and Timing

Romero added that while quantum computing often dominates headlines, Australia has a long-standing strength in quantum sensing and timing. These technologies may be closer to commercial deployment and could enable breakthroughs in navigation, resource exploration, and precision measurement.

Prepared for Deep Tech Risk

Quantum technologies come with differing timelines, modalities, and hardware paths. That can make investment decisions complex—but Romero said that’s where Main Sequence’s experience in deep tech gives it an advantage.

“Of course, we are a venture capital firm, so risk is inherent in how we look at investments, always,” Romero said. “But, besides that, having invested in quantum for the last eight years, we carefully think through things like timelines and how they intertwine with value creation points.”

Australia’s Research Advantage

Main Sequence also sees Australia as well-positioned to lead globally in quantum, in part because of its rich research ecosystem.

“In a really fascinating way, each one of the different universities have really strong expertise, and they have these strengths in the different spaces of quantum,” Romero said. “So, for us, it’s more of a matter of pulling all the pieces together.”

Policy leaders are backing the industry with national initiatives. Australia has launched a quantum strategy, pledged infrastructure investment, and aims to attract and retain top talent. The strategy includes funding pipelines through the National Reconstruction Fund and new initiatives to commercialize quantum research.