Quantum computing: what I'm telling my PE clients now
The window between positioning and exposure is narrowing faster than most mid-market sponsors realize. Here's how I'm framing the quantum conversation, and why Chicago has become ground zero for what happens next.
Alex Kruzel
CEO & Founder, Telesto
March 2026
This is not the AI conversation, it's harder, and earlier
When I talk with PE sponsors about quantum computing, the first thing I do is resist the temptation to make it feel familiar. Quantum and AI are not the same conversation. AI learns patterns from existing data on classical hardware. Quantum computing uses fundamentally different physics, superposition, entanglement. To solve entire problem classes that are computationally intractable today: combinatorial optimization, molecular simulation, cryptography, and complex logistics at scale.
The analogy I keep coming back to: quantum today resembles cloud computing circa 2006. Expensive, pre-profit, but structurally indispensable for the businesses that get ahead of it. IBM now counts over 250 enterprise quantum customers. IonQ, AstraZeneca, AWS, and NVIDIA ran a joint quantum-accelerated chemistry workflow in mid-2025. Quantinuum executed the first fully fault-tolerant algorithm on three logically encoded qubits in March 2025. These are not pilot projects. These are early inflections.
You don't need to understand the physics to take a position. You need to understand whether your portfolio companies are sitting on quantum-addressable value, and whether their encryption posture survives a threat window that most experts now date to 2029–2035.
, The framing I use in every quantum conversation with PE sponsorsThe mid-market is where this gets particularly interesting to me. Large-cap sponsors have dedicated technology functions running quantum assessments. Mid-market sponsors (with $10M to $150M EBITDA businesses across healthcare, industrials, and professional services) are where the preparation gap is widest and the relative value of moving early is greatest. That's the asymmetry I focus on with my clients.
Why I'm watching Chicago, and why the Midwest matters more than people realize
Something has shifted in Chicago over the past 18 months that I don't think the national PE community has fully absorbed (this city, and the broader Midwest ecosystem) is quietly assembling the building blocks of a serious quantum hub, and the implications for mid-market sponsors based here are direct and near-term.
Argonne National Laboratory, just outside Chicago, houses one of the most advanced quantum networking and computing research programs in the world. The Chicago Quantum Exchange, anchored by the University of Chicago and including Argonne, Fermilab, Northwestern, UIC, and the University of Illinois Urbana-Champaign, has become a genuine national asset.
When I look at the quantum investment concentration in Chicago right now, I see something that looks a lot like what happened to Chicago's fintech ecosystem a decade ago, except this time the underlying technology has more profound implications for the industrial and healthcare businesses that define mid-market PE in this region.
, Alex KruzelIllinois has made quantum a state-level economic priority. IQUIST at UIUC has produced foundational research now being commercialized by Chicago-area startups. PsiQuantum, QuEra, and a cohort of quantum software firms are increasingly looking at the Midwest as a talent and partnership market.
The Midwest's industrial DNA, manufacturing, logistics, agricultural supply chains, specialty healthcare, maps almost precisely onto the problem classes where quantum delivers its earliest commercial value: optimization, simulation, and complex scheduling. This is not coincidence. It's structural alignment that mid-market sponsors here should be actively exploiting.
Where quantum lands first. By vertical
I spend a lot of time helping clients separate the near-term signal from the longer-term noise. The tabs below reflect my current read on where quantum creates actionable value for the types of businesses I work with most.
- Drug discovery & molecular simulationActive now
Quantum-accelerated molecular simulation is the most commercially mature application in healthcare. IonQ and AstraZeneca demonstrated this in 2025 (for PE-backed pharma services and CRO platforms) this is a capability worth understanding for competitive positioning. - Healthcare scheduling & resource optimizationActive now
Hospital and clinic scheduling is a combinatorial optimization problem, exactly where quantum hybrid systems are commercially deployed today. Margin improvement via throughput optimization is quantifiable within current hold periods. - Clinical data security & PQC migrationNear-term
Any portfolio company holding patient data needs a post-quantum cryptography roadmap. Full stop. This is the most urgent action item I give to every healthcare platform I advise. Before the next liquidity event, not after. - Genomics & precision medicine analyticsNear-term
Quantum machine learning accelerates pattern recognition across large genomic datasets (for healthcare IT and diagnostics platforms in the PE portfolio) this is a 1–3 year competitive positioning conversation worth starting now.
- Supply chain & logistics optimizationActive now
D-Wave has commercial deployments in manufacturing and logistics today. For PE-backed distributors, 3PLs, and contract manufacturers, particularly those in the Midwest. This is the clearest near-term value creation lever I see in the quantum stack. - Predictive maintenance & quality controlNear-term
Quantum-enhanced machine learning improves anomaly detection across sensor-rich industrial environments. The EBITDA impact from reduced unplanned downtime is straightforward to model in manufacturing platforms. - Materials & process simulationNear-term
Fujitsu and RIKEN's 256-qubit system launched in April 2025 with enterprise manufacturing as a primary target (for advanced manufacturers and specialty chemicals businesses) materials simulation is a 2–4 year competitive moat conversation. - OT/ICS cybersecurity hardeningActive now
Operational technology networks in manufacturing are increasingly targeted. Quantum-resistant security for ICS environments is an immediate action item, and a due diligence requirement that is firming across industrial M&A.
- Financial modeling & portfolio optimizationNear-term
Quantum algorithms for Monte Carlo simulation and portfolio optimization are in active development at every major financial institution (for PE-backed financial services and fintech platforms) this is a 2–3 year competitive readiness conversation. - Large-scale data analytics accelerationNear-term
Quantum machine learning accelerates pattern recognition across large unstructured datasets, claims processing, contract review, talent matching. Relevant for data-intensive services businesses where speed-to-insight is a competitive differentiator. - Secure client communications infrastructureNear-term
Quantum Key Distribution and quantum-safe TLS are moving from government into enterprise. For legal, advisory, and consulting firms, quantum-secure communications will become a client expectation before 2030. - Workforce & capacity optimizationActive now
Staffing, consulting, and managed services businesses with complex project-resource matching are natural candidates for quantum-hybrid optimization today, same technology class already deployed in healthcare and logistics.
Active now = commercially deployed. Near-term = enterprise pilots underway, 1–3 year horizon.
Sector-level sizing for PE portfolios
Expand each sector for market sizing, commercial traction, and the PE value creation angle I focus on with my clients.
Drug discovery dominates adoption. IonQ, AstraZeneca, AWS, and NVIDIA demonstrated a quantum-accelerated molecular pipeline in 2025. The near-term prize for PE-backed healthcare businesses is quantum optimization of scheduling, resource allocation, and data processing. Any healthcare business holding EHR or clinical datasets needs a PQC roadmap before its next liquidity event. This isn't a technology conversation, it's a fiduciary one.
Industrials capture quantum's near-term commercial edge through combinatorial optimization. D-Wave has commercial deployments in manufacturing and logistics. Fujitsu and RIKEN launched a 256-qubit system in April 2025. Margin expansion via operational efficiency is quantifiable in current hold periods with cloud-based pilots requiring no capex. This is the sector where I see the clearest overlap with the Midwest PE portfolio, and where early action creates the most defensible value creation story at exit.
Professional services firms hold sensitive client data at scale. The quantum cyber threat is the most immediate risk: adversaries are already harvesting encrypted data for future decryption. PQC migration done proactively is a competitive differentiator, not just a compliance cost. Before the 2030 threat window closes. I'm seeing this surface in buy-side diligence, and it will become standard within 24 months.
Where the capital is going
Funding has structurally shifted from venture-only to a hybrid model. Total equity funding reached $3.77B through Q3 2025, more than doubling the prior year. Government commitment has crossed $10B globally, led by Japan's $7.4B pledge and the US DOE's proposed $2.5B for 2026–2030.
Source: SpinQ, company announcements. Capital concentration in hardware and error-correction infrastructure signals that the commercial application layer is the next wave.
Three risks I tell every PE client to manage now
These are the risks that show up most consistently in my work with PE sponsors. Expand each for financial quantification and the specific exposure I see in mid-market portfolios.
Hyperscalers. IBM, Google (Willow), Microsoft (Majorana 1), Amazon (Ocelot), are embedding quantum access into cloud platforms at falling price points. Portfolio companies that delay quantum assessment risk being structurally outpaced by peers who began pilots 18–24 months earlier. BCG estimates $450–850B in economy-wide quantum value by 2040; McKinsey expects 80% to flow to end-user industries.
McKinsey / BCG synthesis. Figures represent value accruing to end-user industries.
Google's 2025 research demonstrated an algorithm capable of compromising RSA and elliptic-curve encryption, with practical implementation on fault-tolerant quantum hardware potentially by 2029. Classical encryption protecting patient records, financial models, IP, and M&A data is vulnerable to harvest-now-decrypt-later attacks occurring today. NIST finalized PQC standards in 2024.
Source: IBM Cost of a Data Breach Report 2024. Quantum-enabled breaches will materially exceed these figures.
Quantum literacy is genuinely scarce at the operating company level, and the scarcity is more acute in the mid-market than anywhere else. Portfolio companies that build quantum-adjacent skills now. Through hyperscaler partnerships, cloud platform pilots, and advisory relationships, create a demonstrable optionality premium that shows up in exit due diligence. Chicago's proximity to the Chicago Quantum Exchange and UIUC gives Midwest-based portfolio companies a talent access advantage that doesn't exist in most mid-market geographies.
A PE playbook: five actions by priority
These are the actions I work through with PE sponsors who are ready to move from awareness to practice. Expand each for the specific rationale and implementation detail.
Questions I ask portfolio companies, and suggest you ask yours
- Quantum-addressable value mapping for PE portfolios across healthcare, industrials, and professional services
- Post-quantum cryptography risk assessment and migration roadmaps
- Chicago and Midwest quantum ecosystem advisory, connecting PE portfolios to Argonne, Chicago Quantum Exchange, and emerging commercial partners
- Board-level quantum technology briefings and strategy reviews
- Quantum readiness positioning for exit narratives and CIM preparation
Alex Kruzel is CEO and Founder of Telesto, which provides growth services and investment intelligence to the PE ecosystem. PE firms, owners, and operators. Across industrials, healthcare, and professional services throughout the deal lifecycle. Alex advises boards, C-suite executives, and investors on quantum readiness, geopolitical risk, and technology positioning in volatile markets. She is the author of The Courage to Continue. To follow her work, connect on LinkedIn. To discuss quantum readiness for your portfolio, reach out directly.