By Paul Kaihla

(Business 2.0) – The most powerful modern computers are no match for Mother Nature. Those silicon weaklings can hardly predict the weather, let alone mimic the workings of the human brain. Give them a task as simple as modeling the behavior of one measly neurotransmitter and they choke. In fact, it would take a computer with more than 1094 bytes of memory to simulate a single mood-elevating molecule--say, serotonin. Unfortunately, there isn't enough matter in the universe to build such a computer.

But what if you didn't need bytes as we know them? What if a computer could be made from the same awesome forces that power nature itself? That's the promise of quantum computing, a radical new technology that could deliver billions of times the world's combined computing power in a single device.

On a recent summer evening, a 32-year-old man who has made it his mission to build such a machine is diving for a volleyball at Kitsilano Beach in Vancouver, British Columbia. His hair is filled with sand, and his eyes are wild with adrenaline. His name is Geordie Rose, and he does two things in life. "I play beach volleyball," he says, "and I am utterly, 100 percent devoted to bringing quantum computers into the world."

Too many spikes to the head? Maybe not. Rose has a Ph.D. in theoretical physics, and last year D-Wave Systems, the Vancouver-based company he co-founded, became the first firm in the world to secure venture capital to pursue that remarkable goal. This spring, impressed by D-Wave's advances, NASA's prestigious Jet Propulsion Laboratory in Pasadena, Calif., signed a contract with Rose to jointly develop components that could power the world's first commercial quantum computer.

The profits at stake are enormous--as is the potential boost to human progress. Wrought from the mystical, brain-bending realm of quantum mechanics, quantum computers promise to one day crunch in seconds computations that would take today's fastest supercomputers a millennium. They'll crack every encryption scheme yet devised, including those that protect bank accounts and top-secret government communications. They'll model molecular interactions so precisely that pharmaceutical companies will know the exact side effects of a drug before it's ever introduced to humans. "Quantum computing will change the world in unforeseen ways," says David DiVincenzo, head of a group at IBM's Thomas J. Watson Research Center that has done pioneering theoretical work in the field. "This is like electricity was in the 1830s."

Not surprisingly, the race to build a quantum computer has attracted the world's research giants, including IBM, Japan's NEC, and the U.S. Department of Defense. And then there's tiny D-Wave, the only pure play in quantum computing. It has a paltry 19 employees and no sales, and it's based in a region more famous for world-class weed than for tech triumphs. Yet, unlikely as this may seem, by some measures it leads the pack. D-Wave has filed more quantum-computing-related patents--about 100 so far--than all other organizations combined. It's made key advances in determining how a quantum computer will be built, and it owns exclusive rights to the world's most promising quantum component, known as the Quantronium. "That thing is really impressive," says John Kirtley, an IBM physicist who's working on a similar approach.

In its struggle against tech goliaths, D-Wave's most valuable weapon is without question its CEO, Rose himself. A star wrestler--as a teenager he won numerous Canadian titles--he realized in graduate school that his single-minded determination to pin opponents on a mat might be valuable in high-stakes entrepreneurship. Over the course of the company's five-year life span, he has raised $13 million in equity and grants, and he's constantly on the road pitching investors to feed D-Wave's annual burn rate of roughly $2 million. In truth, D-Wave has made few breakthroughs on its own. But Rose's ability to forge alliances with major research institutions has netted D-Wave ownership of today's most advanced quantum computing technology. As a student, Rose imagined that he might invent a better hard drive. His ambitions have since grown far more grandiose. "Laws of nature state that no machine is better or faster than a quantum computer," he says. "How could I not be jazzed about building one?"

In a 1982 issue of the International Journal of Theoretical Physics, celebrated Caltech physicist Richard Feynman envisioned a new, superfast computer that would store information in subatomic particles and operate according to quantum mechanical laws. But the mathematics behind Feynman's idea was so unfamiliar to computer scientists that it was more than a decade before anyone found something useful for quantum computing to do. Then in 1994, Bell Labs senior researcher Peter Shor (now an MIT professor) proved that a quantum computer--if one were ever built--could ferret out the prime factors of large numbers with blazing speed. That may sound dry, but it was huge: The difficulty of such calculations lies at the heart of the encryption that ensures security for every spy agency, financial institution, and online merchant on the planet. The race to build a quantum computer was on.

Competition grew even fiercer after the 1997 publication of Explorations in Quantum Computing. In that dense volume, Colin Williams, a Scottish protégé of physicist Stephen Hawking, and Xerox PARC's Scott Clearwater explained just how quantum computers would actually work. Put simply, in today's computers, information is encoded in bits that can exist in one of two states, on or off--or, expressed mathematically, 1 or 0. Forged from materials like copper and silicon, bits obey familiar laws of physics. But in the quantum computers that Williams described, information would be stored using photons or electrons, which can exist in two states simultaneously. The ability to represent 0 and 1 at the same time, a quantum behavior known as "superposition," is where the power of quantum bits, or "qubits," originates.

Add a bit to a traditional computer's memory and you double the amount of numbers it can understand. Add a qubit to a quantum computer and its computing power increases exponentially. For comparison's sake, the task of modeling a serotonin molecule that required more matter than exists in the universe could be accomplished with only 424 qubits. No wonder biotech, nanotech, and other industries are hoping that quantum computing pans out.

Rose was a University of British Columbia physics grad student, living in a dorm near a nude beach, when he got his hands on a copy of Williams's book in 1998. Hoping to contribute something more to humanity than a bunch of equations--his father made the cover of Science for discovering the "cod highways" responsible for Atlantic fishery depletion--Rose was excited. But he knew that the same freaky laws of nature that make quantum computers powerful also make them nearly impossible to build. For instance, due to a phenomenon that physicists call "decoherence," qubits lose their quantum magic when they interact too much with their environment. (You can actually void the ongoing calculation of qubits just by looking at them.) Also, while qubits can beat the toughest mathematical questions into submission, the answers they produce reside in universes other than our own. Let's just say retrieving them takes some doing.

Shortly after reading the Williams book, a Russian expatriate named Alex Zagoskin, who was an assistant to Rose's thesis adviser, began circulating a paper in which he proposed a way to overcome those obstacles. A physics Ph.D. with a brown belt in karate, Zagoskin thought he could make a qubit by exploiting an atomic property called a d-wave, which describes electron motion. Rose was so intrigued that he dropped his own dissertation and camped out in his office for four months (including Christmas vacation) trying to disprove Zagoskin's conclusions. Unable to do so, Rose made Zagoskin an offer: "If I can raise $1 million, do you want to build this?"

Rose guessed it would take far more money than that. But he knew just the person to enlist: Haig Farris, a wealthy Vancouver venture capitalist who backed Canadian high-tech successes like Ballard Power Systems. Farris taught an investment course at UBC, and Rose, whose brain seems to toggle effortlessly between the domains of commerce and deep science, had been one of his prize students. After Rose's class presentation on quantum computing, Farris says, "everybody walked out of there--even lawyers like me--thinking, 'Hey, I actually understood that.'"

In 1999, after Rose laid out the implications of Zagoskin's paper, Farris raised $450,000 from angel investors to co-found D-Wave. Farris became chairman, and Rose CEO--his first job ever. The pair hoped to raise more money, but quantum computing didn't fit the zeitgeist of the dotcom frenzy. "We met some high-profile Silicon Valley VCs, but we weren't promising an IPO in 18 months," Farris recalls. "We were politely shown the door." Through a combination of emergency bridge loans, grants from the Canadian government, and an innovative and highly leveraged R&D strategy, Farris and Rose turned D-Wave into their own version of the Manhattan Project.

Within the apartment-size lab that D-Wave rents from UBC's physics faculty, there's an almost perfectly square room where neither cell phones nor radios work, because the metals that line the walls shield the interior from electromagnetic radiation. Lying on a workbench is the Helium Insulated Dilution Insert, affectionately known as Heidi--a 5-inch-thick, 6-foot-long cylinder that resembles a ray gun. At one end is what's called the Iron Maiden, a copper box inside of which the quantum sorcery takes place. "We like these cute names," says Andrew Berkley, a 29-year-old D-Wave physicist whom Rose personally recruited from the University of Maryland, a hotbed of quantum computer development.

Berkley is one of a handful of people in the world who have Ph.D.s in the arcane science of Josephson junctions, which make up the pulsing heart of D-Wave's quantum computer. A junction--two superconductors separated by an insulator that electrons "tunnel" across--is what creates a D-Wave qubit. One of them can fit on the tip of a human hair; made from aluminum and niobium, they're etched onto 5-millimeter-square sapphire chips. They're then inserted into Heidi and chilled to within a degree of absolute zero to forestall decoherence.

Rose happily explains how a quantum computer works. "Say you want to factor a number," he says. "We have a commercial supercomputer, acting as a controller, that translates your input data into a series of short microwave pulses that travel down these coaxial cables to the qubits. The pulses actually program the qubits, which are sitting in this giant inductor. If we had 100 qubits, I could send one pulse in, wiggle the magnetic field, and get 2100 operations!" Rough translation: That would be billions of times more powerful than the combined might of all computers ever built.

Today, D-Wave isn't even close. Its greatest technical accomplishment so far came in 2002, when it got two superconducting qubits working for a whopping 2.5 microseconds, or several times longer than competitors using similar technology. But more impressive than the result is how Rose achieved it. Starting out, he knew that he couldn't afford to acquire all the bright minds and powerful hardware needed to crack such an adamantine nut. So instead of cash, he liberally spread around his power of persuasion, contracting out work to researchers who were both eager to participate in a history-making project and privy to expensive lab equipment. At first, D-Wave relied on Zagoskin's network of former professors and classmates in Europe. But as Rose circled the globe attending conferences and visiting labs, he recruited research teams with the skill of a politician. Outsourcing work to universities and labs in England, Germany, Sweden, and the United States, D-Wave often received matching funds from host facilities. Scientists turned over all copyrights and patents to D-Wave in return for small equity stakes (as many as 10 research and academic institutions own D-Wave stock) and the right to publish their findings. One of the remote teams, led by physicist Evgeni Il'ichev at the Institute for Physical High Technology in Jena, Germany, actually built D-Wave's first superconducting qubits. "We created a virtual institute," Rose says.

But in December 2002, D-Wave found itself buried under more than $500,000 in unpaid bills because Rose's fund-raising hadn't kept pace with the company's burn rate. He was forced to disband most of his network of scientists, handicapping his company just as the field of well-funded competitors began to grow.

Measuring who's ahead in the quantum computing game boils down to how many qubits each group can "entangle"--that is, get to work together as a single computational system. Three years ago IBM created a 7-qubit processor that factored the number 15 using nuclear magnetic resonance (NMR) technology, but experts now agree that NMR won't be practical past 10 qubits. IBM has abandoned NMR qubits, but it's still spending about $2 million a year on quantum computing research, including that of IBM fellow Charles Bennet, a top Nobel contender. NEC also boasts a first-rate team, led by Yasunobu Nakamura, whom Rose calls "by far the best scientist on the planet in superconducting qubits." In fact, Nakamura has developed a 2-qubit device not unlike D-Wave's. (Jaw-Shen Tsai, Nakamura's colleague, says NEC is ahead because it can not only entangle qubits, but also control them in ways necessary to build a working processor.) The U.S. government remains in the hunt too, investing an estimated $80 million a year in quantum computing. In September, the Defense Advanced Research Projects Agency, the Pentagon's most rarefied R&D arm, is expected to announce a 10-year project to build a quantum computer. The project's budget is rumored to top $200 million.

Though Rose hopes ultimately to shatter every known computing speed barrier, his more immediate goal is to build a 32-qubit processor, computationally as powerful as a Cray supercomputer cluster, by 2007. His plan is to reach 4 qubits by December ("We already have stuff in the fridge spewing out data!"), then double the number each year thereafter. Those concrete targets persuaded Silicon Valley venture fund Draper Fisher Jurvetson to lead a $7 million round of financing for D-Wave last year. With more than $100 million invested in nanotech companies, DFJ views quantum computers as a catalyst for the industry's growth. "Nanotechnology progress is a pale shadow of what it could be if we could simulate the materials we're trying to build," says DFJ partner Steve Jurvetson.

Competitors, of course, suggest that D-Wave's CEO is looking through rose-colored glasses. "I would be very surprised if they can do 30 qubits," says physicist Raymond Laflamme, a veteran of the quantum computing program at Los Alamos National Laboratories. "It's possible, but it's a stretch." Henry Everitt, head of the physics program at the Army Research Organization, says the science is simply too underdeveloped for any startup--let alone poorly funded D-Wave--to achieve what Rose is proposing. Others dismiss the ambitious timetable as a marketing ploy designed to bait new investors. "What's wrong with that?" D-Wave's Farris asks. "That's what startups in emerging technology do."

Rose admits that he's perpetually running out of cash, and has asked employees to go without salary more than once. But with the endorsement from a powerful Silicon Valley VC firm, he's been scouting for new allies. In December 2003 he bought exclusive rights to the Quantronium, a qubit developed by French government agency Commissariat à l'Energie Atomique. (Roger Koch, who leads IBM's quantum computer team, calls the Quantronium "the best qubit around," but doubts that D-Wave can profit from it before the patent runs out.) Two years ago a group of academics at the University of Kansas published a paper in Science claiming that their qubits lasted twice as long as D-Wave's, an outcome so astonishing that few believe it. In April, in an unrelated cost-cutting move, Northrop Grumman closed the superconducting lab in Southern California that fabricated the Kansas team's hardware; by June, Rose had retained the lab's quantum computing chief.

Rose's latest, greatest coup was the May contract with NASA's JPL, which has four teams working on quantum computing, all funded by the National Security Agency. One of the teams will attempt to build a qubit incorporating Quantronium breakthroughs. The deal was brokered by none other than Rose's mentor, Colin Williams, who became a JPL program manager shortly after writing his book on quantum computing. Williams believes that D-Wave's new design will work even for large numbers of qubits. "That's why I'm backing it," he says.

While the scientists wrestle with their latest challenge, Rose pounds the pavement in search of more talent and cash. In a parking lot after a recent panel discussion at Stanford University, he corners a fellow speaker--a computer science professor from the University of California at Berkeley who specializes in adiabatic algorithms, a promising method for solving difficult problems using quantum computers. Rose goes into recruiter mode. "We totally agree that adiabatic algorithms are the way to go," he coos, buttering up the scientist. "Our whole program is built around that."

Watching the man walk off into the night, Rose admits that probably nothing will come of it. "Most of the time, people tell you to go screw yourself," he says. Some might dwell on the rejection, but he only seems more determined: "What would bring tears to my eyes would be to press the button that turns on the first quantum computer. If I can claim that at least some part of its construction is my own, I think I will have achieved my life's ambition."

First, though, he has to make payroll.

Paul Kaihla (pkaihla@business2.com) is a senior writer at Business 2.0.