Canadian quantum stock Xanadu jumps in first day of trading on Nasdaq

Christian Weedbrook, chief executive officer of Xanadu Quantum Technologies Inc. Photo by Galit Rodan /Bloomberg

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Shares of Toronto startup Xanadu Quantum Technologies Ltd. jumped in their first day of trading on Friday, closing at US$11.50 per share in New York.

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The company debuted on both the Toronto Stock Exchange and the Nasdaq, becoming the first photonic quantum computing company to go public and the first Canadian technology company to complete a public listing in nearly five years. Xanadu chief executive Christian Weedbrook said in an interview this week that the dual-listing will enable the company to tap into U.S. money while reaffirming its commitment to the Canadian market.

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Xanadu concluded a merger with U.S. special purpose acquisition company (SPAC) Crane Harbor Acquisitions Corp. on Thursday, which had been priced at US$10 per share, meaning Friday’s market gain was in the 15 per cent range. The company raked in US$302 million before fees, which was less than the US$500 million it had expected.

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Weedbrook, who was in New York for the bell-ringing ceremony on the Nasdaq, said in an interview this week that listing day is a “good chance to stop and smell the roses, but I am more excited about getting the capital and getting back to work.”

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The listing proceeds will boost Xanadu’s coffers as it accelerates its US$1-billion quest to build a large-scale, commercial quantum computing data centre in Toronto by 2030. Weedbrook hopes that the public listing will also make the company a more attractive investment for Canada’s largest pension funds, known as the Maple Eight.

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“Now that we’re public, that mechanism for liquidity is available for them. You’re not just a startup that may not be around next year,” he said.

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Xanadu is trying to prove that its approach to quantum computing — which uses photons, or particles of light, to store data and make calculations — can scale up quicker, easier and cheaper than other companies’ approaches. The process of creating an error-free quantum computer that can be scaled up into a machine useful for industry is research-heavy and capital-intensive, with Weedbrook noting that diverse sources of funding are needed.

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Weedbrook admitted that he was initially cautious when it came to SPACs, but decided it was the right path for Xanadu given that the SPAC route has been “well worn” for quantum companies.

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“It’s one of very few ways where you can raise a large (public investment in private equity) and so forth. The ability to raise additional capital once we’re public is also a very attractive proposition for us,” he said.

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