Quantum Equity at High Speed
A High-Stakes Gamble by the U.S. administration that already backfired
“If taxpayers Fund Innovation, they should also Share in its Success.”
No, this was not the Economist Mariana Mazzucato, the author of Entrepreneurial State, the Value of Everything, and Mission Economy.
This was President Donald J. Trump.
Last week the Wall Street Journal published how the Commerce Department is in talks with several quantum-computing companies for them to give equity stakes in exchange for federal funding, a direct continuum on the Trump administration’s moves to take equity in the semiconductor and AI industries.
Companies including IonQ, Rigetti Computing and D-Wave Quantum are discussing the government becoming a shareholder as part of agreements to get funding earmarked for promising technology companies, according to people familiar with the matter. Other companies such as Quantum Computing and Atom Computing are considering similar arrangements. *)
According to WSJ, the quantum companies are discussing minimum funding awards from Washington of $10 million each, and other technology companies are also expected to vie for the funding.
Quantum Companies follow Intel, Nvidia, and AMD in striking financial deals with the administration for activities that used to be lobbied in the Congress.
On August 11, 2025 it was announced that “Nvidia and AMD have agreed to share 15% of their revenues from chip sales to China with the U.S. government, as part of a deal to secure export licenses for the semiconductors.”
On August 22, 2025, Intel agreed to sell equity in exchange for government grants. From NPR: “President Trump said on Friday he had asked Intel CEO Lip-Bu Tan for a 10% stake in the company during a recent meeting at the White House. “He agreed, and they’ve agreed to do it, and I think it’s a great deal for them,” Trump told reporters. “He walked in wanting to keep his job, and he ended up giving us $10 billion for the United States,” Trump said.
Then, September 18, 2025, less than a month from the administration’s announcement to acquire 10% of Intel, Nvidia announces it will take a $5 billion stake in Intel. According to Reuters, this offers a new lifeline to the struggling chipmaker. Intel shares jumped nearly 23% after markets closed, making it the largest one-day percentage gain for the company since 1987. Nvidia stock also rose more than 3%.
So, to summarize, what the administration did there was to agree with the semiconductor industry a shared revenue deal, to own part of this industry, then making sure the industry stays strong to ensure the administration’s revenue and shareholder value.
Now it looks like they are looking to do a similar round with the quantum industry.
Brilliant - or is it?
Public Investment is a Good Investment
When I was doing research for my book Government and Innovation, I wanted to understand the role government’s play in creating innovations and launching new industries. I found several pretty mind-blowing statistics about the Return on Investment (ROI) on public investments (source Economic Policy Institute):
17% ROI established by Bom and Lightart (2008)
30% ROI established by De Haan and Jong-A-Ping (2008)
45% ROI established first by Ascheaur (1989) and then by Isaksson’s (2007)
Then just yesterday, October 30, 2025, the UK government published a study ‘The value of public R&D’ where they present that “based on a comprehensive analysis of the evidence, DSIT’s assessment is that, on average, £1 of civil public R&D investment generates £8 in net economic benefits for the UK over the long term.”
“Based on a comprehensive analysis of the evidence, on average, £1 of civil public R&D investment generates £8 in net economic benefits for the UK over the long term.”
According to 'Private markets: A slower era - McKinsey Global Private Markets Review 2024’, for VC funds launched between 2011-2020, the median net Internal Rate of Revenue (IRR) was 16.4%.
The S&P 500, on average, has grown by about 11.4% annually between 2015 and 2025.
Public investments, be it in infrastructure, direct SME support, or government funded R&D, yield better returns than most VC funds or the stock exchange.
Great Idea but not Like This
So, is it a good idea for the U.S. government to invest in quantum? Yes, absolutely.
The government has single handedly created the entire industry, first by funding the scientific research, then educating talented workforce and granting H1-B visas so the early pioneering companies were able to create prototypes and products, possibly there has been some state funded IP spin-offs here and there, and also by buying the equipment and services directly from the private market.
Other ways the government supports the creation of innovation and new industries are by favorable laws and regulations, interest rates, taxes, and trade agreements. All of these are tools in their portfolio to favor one industry, possibly at the expense of another.
Governments choose winners and losers every day. It’s literally the job.
In the U.S. these decisions have traditionally followed careful conversations between the industry representatives, relevant Departments, State Governors, and State and Federal level Members of Congress and Senators.
Quick unprepared decisions to require equity in exchange for grants, or to request revenue share in exchange for exceptions to regulations, is not the way.
It’s pure common sense for companies and consumers to expect predictability, stability and the rule of law from their own government. If you need to be convinced by research, there’s good reading here here here and here.
*) EDIT: As I was doing research for images for this story, I ran across a Fox News piece that disputed their earlier reporting, and said “The Trump administration is not in talks to take equity stakes in U.S. quantum computing firms, the Commerce Department confirmed to FOX Business Thursday, pushing back on a Wall Street Journal report that suggested the government was exploring investments in companies, including IonQ, Rigetti Computing and D-Wave Quantum.”
“The Commerce Department is not currently negotiating equity stakes with quantum computing companies,” a Commerce spokesperson told FOX Business.
Whether the original WSJ article was correct or not - which I think it was if you read this and this article citing multiple credible people from the industry - just proves the point to expect predictability and stability from your government.
About Deep Policy
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Hi, I’m Petra Söderling. Welcome to Deep Policy, a space where I help you understand how governments, technology, and innovation policy shape the world around us.
This newsletter and blog continue the conversation I began in my book Government and Innovation – the Economic Developer’s Guide to Our Future, and on my podcast Deep Pockets with Petra Soderling. If you’ve ever wondered why governments pour billions into quantum, AI, or biotech, or how geopolitics bends the path of technology, you’re in the right place.
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The audiobook: Government and Innovation - the Economic Developer’s Guide to our Future
My 2022 Amazon Hot New Release (editorial pick) is divided in three sections; the Tools that governments have to create new innovative industries, Examples from five countries who’ve done it right, and a How To section for implementation. Available in paperback or hard cover.
Quantum Strategy Institute
In my role as the Head of Government and Consortium Relations at QSI, I’ve written many papers on how public quantum strategies support economic growth. Explore the full website or find my articles directly here.
This piece feels incredibly timely, and it makes me wonder what if this state-as-investor model, while potentially democratising gains from public funding, inadvertently sets a precedent that could either accelerate or over-regulate nascent technologies like quantum, perhaps even influencing their ethical developement.
The ROI statistics on public R&D investment are absolutly eye opening. That UK study showing 8 to 1 returns is wild, and it puts the quantum equity stake approach in a really intresting light. I think your point about predictability and stability is crucial here. The semiconductor industry has spent decades working with Congress and federal agencies to build out a framework for collaboration, and suddenly having ad hoc equity negotiations with individual companies undermines all of that institutional trust. For quantum specifically, QUBT and the others are still years away from comercial viability, so the government taking equity now is basically betting on pure potential. The comparison to VC median IRR at 16.4% versus public R&D at 800% really drives home how much value governments create when they invest properly. Great analysis of how this should be approached more systematically.