Podcast with Brian Lenahan - Quantum Strategy Institute

My guest today is Brian Lenahan, Founder and Chair of the Quantum Strategy Institute. Brian and I speak about his new book “Quantum Boost”, the Quantum Strategy Institute, his predictions about a quantum winter and much more.

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THE FULL TRANSCRIPT IS BELOW

Yuval Boger (Classiq): Hello, Brian, and thanks for joining me today.

Brian Lenahan (Quantum Strategy Institute): Hi, Yuval. Thank you so much for having me.

Yuval: It's great to have you. So who are you and what do you do?

Brian: Well, my name is Brian Lenahan. I'm the founder and chair of the Quantum Strategy Institute. I'm also an author and I help companies with their quantum roadmaps.

Yuval: Sounds like you've been a busy person in the last couple of weeks. I think you have a new book, and also the Quantum Strategy Institute, which I think was launched recently. Could you tell me a little bit about both the book and the institute?

Brian: Well, there's a bit of a correlation actually between the book and the institute. I started in quantum quite a few years ago, and as I started to attend conferences and talk to various players in the industry, it became really clear that we had done a fairly good job on the research side and then moving some of that research from the lab into the production capability. But what was often lacking was that conversation or that transition into the consumer side.

So how could businesses take a very complex subject and make meaning of it to the point where they could decide if they wanted to invest. And so those were some of the challenges that I really wanted to address when I started researching the book. And as I completed the book, I started to realize there were a lot of other players, whether that was a vendor or a researcher or somebody just as an enthusiast was looking at how could they get involved. And so that really brought me to the point where I wanted to create a quantum strategy institute that can actually address all of those things.

Yuval: And when you say vendor, do you mean a quantum computing vendor or just a cloud vendor or someone who has a sort of a peripheral interest in quantum as opposed to that being their main business?

Brian: Well, I have to say all of the above because most of the presenters at these conferences were hardware or software vendors of quantum capabilities. But if you think about it from the purchaser side, they're looking and saying, "Okay, am I completely replacing my quantum capabilities that are completely replacing my traditional capabilities with quantum?" And that's really not the case. Conventional computing is going to be around for a long time. And so really how can they think about their hybrid perspective in their companies?

And so you would have those sorts of people who would look at it and say, "Am I simply looking at quantum computing from a pure perspective, or do I need to think about how those two things intersect?" And then it sort of went from there in terms of, okay, so if you have those kinds of questions, what are the criteria? What are the factors that you need to think about to make a really strong decision about how to pursue that on your roadmap?

Yuval: So let's dive into both sides. I want to ask you first about the end-user side or the corporate side, and then on the vendor side. I know that you've also worked in AI and machine learning and other fields sort of frontier technology, other than quantum. When you go to these enterprises, do you see quantum as a separate investment, the separate activity, or do you see that ingrained with other things that they're doing?

Brian: I see it as an evolutionary addition to what they're doing today. And so I'll talk a little bit about that. Whenever I talk to corporates or scaling companies, I'm an advisor in a regional innovation center, for example. And so when I talk to those companies, one of their first questions is, "Brian, is this just hype?" Is there a lot of money being invested or there are a lot of articles talking about future capabilities. And so are there any real sort of in-market or near term applications?' And so I'm able to describe maybe what Volkswagen is doing or ID Quantique with Samsung or some of the cryptography capabilities that are going on between Beijing and Shanghai and in Chicago.

So they start to see that those are actually in market capabilities. So once we get past that conversation, we can now move into the, "Well, what does it mean to me?" And the key thing there is focusing on the business problem, not the technology. We're really focusing on what problem they're trying to solve. It may be AI, it may be quantum, it's maybe some other capability, but that's really where I really need to first work with them on is their business problem. And so when we do get to the point, I've had a conversation this week with a company who's got very strong AI capabilities, and now they're starting to think about what does that mean in terms of trying a quantum gate approach, or simply doing a pilot with some of their data and some of their capability. And so it's that kind of evolution that I'm seeing most.

Yuval: And so we see companies in various stages of quantum readiness. We see companies that are just thinking about quantum, where maybe they heard about it, maybe they read the Gartner report, they see all these investments being made. And so they say, "Oh. This is something that we should get into." And then we see companies who are doing proof of concepts, "Let's pick a certain area in the enterprise and see if quantum can at least match what we're getting on classical, and then try to extrapolate it to see what kind of advantage we would get when they're stronger computers." And then there are a few companies that are moving quantum into production and saying, "We had a successful proof of concept, now we're doing production." At which of these three stages do you find yourself primarily working? Is it the early stages trying to say, "Should I get into quantum?" Or is it later on in the chain?

Brian: So I would say it's at the first two stages where companies have a strength typically with machine learning. And they're now looking at being competitive, first of all, and addressing some of those business problems that quantum capabilities have. So what they're looking at is, where does quantum fit on my company's roadmap? How quickly should I start to invest? Not only in dollars for licenses or cloud time or whatever, but also in terms of people resources.

So if you don't have, same thing in artificial intelligence, if you didn't have some champions at the top end of your organization who were willing to champion that new capability, which many considered a black box, quantum, which is even more complex, can be much more challenging to present to the C-suite. If you've got some people who have very strong capability in making quantum somewhat more common sense or common language, and then being able to articulate that in a less risky sort of format, the organization's going to be much more successful in trying to bring quantum as a capability.

Yuval: And it sounds like you're doing some kind of, I heard the term “business translator”. Speaking to the businesspeople on one hand and the technologists on the other and saying, "Let's see if we can make you speak the same language and each one understand the challenges and the benefits that the other one wants to see and is seeing." Is that correct?

Brian: You got that, that's exactly right. And if in the first stage where they're just thinking about quantum, if entanglement or superposition comes up in the conversation, it really tends to go nowhere. The conversation really is about mapping their business problem to what the potential capabilities of quantum computing or sensing or communication are. And it's many, many conversations further down the road where we start talking about the quantum physics and mechanics.

Yuval: Staying a little bit longer on the corporate side, there are companies who say, "Oh, I think I can use quantum to just reduce cost or spending X amount of dollars on high-performance computing. And maybe I can do that cheaper with quantum." And then there are companies who say, "Oh, this may actually be a new revenue stream or a completely new product for us." If you were a betting person, do you think the first cost reduction or the second one, so the new product, would be the majority of successful use cases?

Brian: Well, it's interesting, you ask that because as I look at the marketplace and I see some of the first movers, I start to think about financial services and things like portfolio and trade optimization. They are very much looking for greater margins, greater revenue opportunity from better accuracy, better forecasting, more real time activity. So I see that sort of on, it's a bit on both sides. But the other side is, or the other early movers around cryptography and moving into post-quantum cryptography where you've got people who are concerned about their traditional data security.

So that's really less a revenue play, much more of a security or a risk concern. And so whether you simply read that in the media, or you've talked to somebody over the water cooler, data security is quickly becoming one of those key questions, whether you believe in QKD or the NISQ approach. There's movement that's very quickly happening. And I think it's going to happen faster than later.

Yuval: So switching to the vendor side, if you are a quantum vendor and you're versed in the industry, you've got people who do this for a living 24 hours a day, or at least 10 hours a day. Why would a company like that benefit from the Quantum Strategy Institute or from the book and from the work that you're doing?

Brian: Because I think, the person that I speak to or the role that I speak to most often on the vendor side is the chief business or chief business development officer. And when they approach me, it's much more about we are trying to communicate to this consumer community and it's taking up a lot of our time. It's a challenging thing to do. It's very difficult when we talk to CTOs who already have a massive portfolio of technology projects. How can I insert myself in that conversation? And so by talking to a group like the Quantum Strategy Institute, where we have the perspective of many use cases, many applications and places where it's been successful. But not only that, we're the successful application of it, and what that adoption technique looks like can really be beneficial to those, that vendor community.

Yuval: Do you see quantum activity primarily at the larger companies, the Fortune 500, the Global 2000, or do you see it also in small and mid-sized companies? And I'm excluding those where quantum is their business.

Brian: A great question, and I have the good fortune of actually seeing both sides of that spectrum. And the reason is through the Quantum Strategy Institute, you know, we're connected with organizations like Google and Cambridge and ColdQuanta and various other organizations. So we have that insight into what activities they're involved in. But also if you look at JP Morgan Chase, Goldman Sachs, all those sorts of other large financial institutions who have made significant quantum investments already on the very smaller end of the scale. And certainly Volkswagen would fit into that large organization, large investments, and very practical applications on the factory floor. So then you think about the very small organizations.

Fortunately, as an advisor in the regional innovation center world, I have the opportunity to talk to these scaling companies. And what they're saying is, "Brian, I really don't know a lot about quantum. Can you tell me whether there are opportunities or use cases or applications that are relevant to me?" So maybe for example, they're involved in fraud mitigation, or they're involved in customer optimization and recommendations. Well, both of those sorts of capabilities are ideally suited in certain cases to quantum computing. And so they're very much interested in, "Where can I put that on my roadmap even if I don't spend a dollar in 2021?"

Yuval: So what's your estimate on the Fortune 500? What percentage of the Fortune 500 actually have quantum teams? I know that's sort of the $6 million question, but…

Brian: It really is. And I would hesitate to make a guess on that, but what I would like to, I'd very much like to see within those organizations is that they start to develop roles that are focused a little at a different level than maybe a quantum engineer or a data scientist of sorts, where they're bringing in strategists to really understand the marketplace. They understand the vendors, they understand the different modalities.

So if I'm a Fortune 500 company, am I making an investment in a superconducting or an annealing or an ion trap or a photonic sort of environment as these sorts of modalities really have yet to converge in any material way. And so looking at those Fortune 500 companies, investing in people, and there aren't a lot of them out there today, people who have that sort of sense of the marketplace. And so they can more quickly sift through and identify, maybe even optimizing that sort of vendor pitch kind of scenario.

Yuval: Let me give you a master of the universe role. And so you have a magic wand and you can control what the quantum vendors, software, hardware consulting vendors are doing in the next 18 months or so, what would you have us, what would you have them working on to get quantum into the field, into production as quickly as possible?

Brian: So what vendors have done is a wonderful job on the research, on the movement from laboratory to production side. And so many potential opportunities for the future. But what I would say to them is gaining a very clear understanding of the business problems that those companies have. So instead of leading with features and benefits, really understanding what those target companies have in terms of business problems and how there are opportunities to either solve them at scale, or simply to look at it from a pilot perspective. I think both of those opportunities are going to be relevant to those decision makers, those C-suite people who are already investing millions in traditional and conventional computing, and they need to understand how this transition maybe more successful.

And I'll give you an example of that. One of the leaders on my team often talks about the difference between CapEx and OpEx. And very much the quantum world is actually an OpEx environment where you're not necessarily buying the hardware that goes along with this, you're using cloud and computing time. And whether you're testing that even on a free basis, in some cases to leverage the quantum machine learning and algorithms. So it's a very interesting different conversation that those CTOs and C-suite people will need to decide on.

Yuval: Are you worried about a quantum winter? I mean, if we go back to AI, there was a time 20 years ago where, oh, we thought that AI was going to take the world over. And then there was a valley of little activity or maybe academic activity until good enough hardware came along and maybe the business understanding. And now of course, AI and ML are front row. Are you worried that this will happen, might happen in quantum computing?

Brian: Some of the elements here in quantum are very similar to the AI winters where significant investments were being made, promises were being made along with that, and it didn't deliver. And so some of the challenges that we've had in the quantum space over time, and particularly in the last five years have seen significant investments. They've seen lots of production, but then you've got, and along with that, people like Scott Aaronson at the university of Texas who's much more cautious about the quantum space and seeing it being a little longer term than more near term. But then you've also on the flip side, you have the production that's actually happening.

I've watched in the last couple of years, the team at Volkswagen really move into the quantum space within their factory floors. I've seen companies like ID Quantique make massive improvements with their quantum random number generator chips. So there are in-market opportunities or market activities that I just do not see the same winter sort of ecosystems that I did with AI. So I'm much more optimistic that companies will see the near term application benefits of quantum and start to make those investments. They may not be as rapid as we would all like to see, but I certainly don't see an immediate quantum winter coming in place.

Yuval: That's great. So how can people get in touch with you to learn more about your work?

Brian: So one of the things you can do is certainly check out our Quantum Strategy Institute website. And what's beneficial there is that I have a certain background, 25 years in financial services and IT, and working on large projects. But I also have a management team of eight other people with experience in quantum machine learning, in very large corporate environments with, from vendors from consumers. So the institute itself has a wide diversity of experts who are available to the larger audience that they can take advantage of.

Yuval: Thank you so much for joining me today, Brian.

Brian: Thank you.