London’s sole public quantum investor, Quantum Exponential Group, is delisting, underscoring ongoing market challenges.
- The decision stems from difficulties in attracting new investors despite a keen interest in the tech sector.
- A downturn in liquidity and valuations for micro-cap companies is affecting their public trading viability.
- Quantum Exponential joins other UK tech firms opting to become private, highlighting a trend in the industry.
- CEO Steven Metcalfe had expressed optimism for the quantum sector, but financial challenges persist.
Confidence in the London markets is facing further trials as Quantum Exponential Group decides to delist from the public markets. Announced in a recent company update, the resolution to withdraw trading on the AQSE Growth Market was approved at a general meeting. Consequently, trading in Quantum Exponential shares is set to formally end at the close of markets on 30 October.
The company’s transition signals a growing struggle for small-cap tech investors in securing new investments under public listing constraints, despite widespread interest in their technological pursuits. In February 2024, Quantum Exponential highlighted that its publicly listed status was a hindrance to attracting fresh investment.
Moreover, the delisting is occurring amid a broader context of reduced liquidity and lower valuations for micro-cap listed enterprises. This challenging environment has been exacerbated by geopolitical tensions, further straining the company’s market presence. Since its initial public offering (IPO), Quantum Exponential’s shares have plummeted over 90% from their peak value of 6.875p in November 2021.
This movement towards privatisation resonates with other British tech firms such as Manchester’s C4X and fintech group Tintra, both of which also elected to exit the UK public markets, driven by the difficulties in raising new capital.
Quantum Exponential Group, noted for supporting early-stage quantum computing ventures like AegiQ and Universal Quantum, initially went public on the Aquis Exchange, raising just over £5 million and valuing the startup at nearly £20 million. Despite CEO Steven Metcalfe’s optimistic statements about the quantum computing industry and increasing support from governments globally, the company reported significant financial losses.
For the fiscal year ending April 2023, the company posted nearly £2 million in pre-tax losses, in contrast to a profit of £343,933 the previous year. The valuation of its assets also diminished, dropping from £5.7 million to £3.8 million, reflecting the prevailing industry-wide financial pressures.
The delisting of Quantum Exponential Group highlights the continuing volatility and challenges faced by technology firms within the public financial markets.
