Thoughts on Quantum Materials Corp (QTMM)

Written by Jeffrey Cohen, President, US Advanced Computing Infrastructure, Inc.

While writing a pitch for quantum computing and our firm to a potential partner, looked for related startups to learn from.  Quantum computing is not production-ready.  Governments, universities and industry are still developing the technology.

A related technology is quantum dots.  These are very useful in that they convert light to electricity, and electricity to light in very specific frequencies (read colors).  This firm has made some seemingly unrelated, but clever announcements lately about their shift to new markets including blockchain, product tags (e.g., RF tags but cheaper and tamper proof).  They have also filed sever SEC documents, so I thought I would take a look.

1) Company overview from early 2019 shows the stress of being a startup (See SEC Filing here).  How something like a lawsuit from a previous lender can distract and disturb the ongoing operations.  How the promise of a new technology takes time, patience, tenacity and a willingness to play the long-term game.

2) A January 2018 interview with CEO Stephen Squires, found here, gives a solid overview of the company, the technology, and the vision to a non-scientist.   

3) The company looks like it is losing about $7M to $8M this year, down from over $9M last year, and is starting to see some revenues (~ $1M) from a manufacturing partnership in India.

Why post this?  It is a reminder that a new quantum technology that could have far-reaching impacts in both lighting, consumer displays, and possibly quantum computing takes time to develop and commercialize.  It starts with a vision, humble beginnings, tenacity and hard work.  It starts with humble beginnings.  One firm, focusing on lowering the cost of production and application of quantum dots in LED displays by 50% to 80%, is on a long journey.  They figured out that they could spray the dots right on the LED bulbs instead of on a firm that is then integrated into the display.  The film is expensive. 

Is this a fairly priced stock?  Not sure...after a few hours of homework there is much to consider.  For example, SEC filings show a delay in releasing their most recent 10Q and 10K.  There is that lawsuit the CEO mentioned.  Seeking Alpha entry shows about $3M in debt, and near-zero revenue.  52 week range is $.02 to $.06.  This is a near zero revenue bet on a future investment. 

Nanoco Group PLC is a competitor that we blogged about earlier...how are they doing?

Here is a picture of the 5 year stock price chart for QTMM (thank you Yahoo Finance):

US Advanced Computing Infrastructure Inc., nor Jeffrey Cohen, nor any related persons have a position in QTMM, nor are we receiving compensation for writing this BLOG entry.  This is not investment advice. 
​This is a discussion of a quantum technology startup running a marathon to commercialization success.

June 30, 2020 update:  Check the stock and see it is down more than 50%.  At this time, we remind our readers that quantum computing and quantum technologies take a long time to mature and gain traction.  

In our case, we are about to publish findings on our quantum computing work in financial portfolio optimization after working for 6 months on the topic.