The Groningen deep-tech startup QDI Systems received around €5 million in December to take its groundbreaking quantum dots technology to the next level in both the medical sector and new markets. In the third round of investments, NOM also jumped on board, joining previous investors like Carduso Capital, RuG Ventures, and the renowned Finnish venture capital fund Maki.vc.
QDI Systems is a spin-off from the Zernike Institute for Advanced Materials at the University of Groningen and was founded in 2019 by CEO Artem Shulga. Shulga and his team developed a technology based on cutting-edge nanomaterial: quantum dots. This material converts photons into electronic signals in a very efficient way and has been widely used in imaging and sensor technology in the past few years.
From Ukraine to Groningen
Shulga grew up in Eastern Ukraine, where entrepreneurship was ingrained from an early age, albeit out of necessity. "I was three years old when the Soviet Union fell apart," says Shulga. "My parents, who were engineers, lost their jobs when the state factory where they worked closed down. They were forced to become entrepreneurs because there was no work. So, I basically grew up with the idea that if you want to achieve something in life, you're responsible for it yourself. You can't rely on the government or anyone else for security."
In 2011, Shulga came to Groningen for a Master's in Nanoscience and later pursued a PhD in quantum dots research. "During my research internship at the University of Tokyo, I saw they had a lot of successful spin-offs," says Shulga. "I wanted to start a company too because I knew there were many commercial applications for quantum dots." Upon returning to Groningen, Shulga enrolled in the VentureLab North incubator program and founded QDI Systems in 2019.
Fascination with radiation
For the medical sector, QDI Systems pioneered the world's first quantum dots application for X-ray machines. When quantum dots are used in X-ray examinations, they can deliver higher image quality at much lower radiation doses. The technology could have a significant impact on procedures such as mammography screening and diagnostics.
"I was fascinated by radiation ever since I was a child," says Shulga. "Before coming to Groningen, I even worked for a year in Chernobyl at the Institute for Radiation Protection. So, when I looked at commercial applications for quantum dots, I quickly turned to X-ray. There was also very little competition, mainly because it's an incredibly challenging market. But I was young and enthusiastic, so that seemed like the perfect challenge for me," Shulga jokes.
Maki
The first year in particular was definitely a challenge. "There were moments when I thought, 'This will never work,'" admits Shulga. "But my family and friends helped me with a small initial investment, and that gave me the motivation to keep going. Professional investors understand the risks, but your friends and family don't. You don't want to disappoint them, so that kept me from giving up and motivated me to work even harder."
After the initial investment rounds from Carduso Capital and RuG Ventures, the renowned Finnish investment fund Maki.vc entered the scene for QDI Systems. "That was a huge validation for us. In Finland, you can turn over any stone, and two engineers will come out from under it," Shulga quips. "They have extensive knowledge in deep tech, and they are very critical. So, the fact that Maki wanted to join the previous investment round and the new one means a lot."
Visionary
In the third investment round, QDI Systems raised nearly €5 million. The startup received an innovation credit of €1.97 million from the Netherlands Enterprise Agency (RVO). This special credit is intended for the development of innovative projects with significant technical risks and excellent market prospects and only very few startups qualify for it. The credit helped secure the rest of the investment and the remaining €3 million came from Carduso Capital, RuG Ventures, Maki.vc, NOM, Golden Egg Check Capital and relevant angel investors.
"QDI Systems is a startup with a fantastic team and enormous potential," says Ytsen van der Meer, investment manager at NOM. "Artem Shulga is truly a visionary in his field and knows better than anyone how to solve technical challenges. And with the arrival of Juul Gielens as Chief Business Officer this year, the company now has a wealth of experience and expertise in business development and sales. That creates a perfect balance between technical and commercial."
According to Shulga, QDI Systems now also has a perfect balance in investment partners with the addition of NOM. "Maki is a large and specialized international fund. That gives us access to a vast international network of companies we can collaborate with. But, of course, we also need talented people for that. NOM has a fantastic regional network to attract talent, so this is a great balance for us."
New lab and scale-up
Since July of this year, QDI Systems also has a new lab. "This makes us completely future-proof, and we can scale commercially because with this new lab with cleanroom facilities, we can produce up to 50 times more," says Gielens. "In addition, with the investment, we aim to double our team over the next few years, both on the commercial and production fronts, as well as on the R&D side. We look forward to working on existing and new applications of our quantum dots technology globally."
Shortwave Infrared is one of those new applications that QDI System is already actively working on. "This includes industrial applications, such as image sensors for sorting processes," Gielens continues. "But also consumer market applications, like facial recognition for mobile phones. The great thing is that as a startup, we're now at a point where companies reach out to us for collaborations. Earlier, we had to pull much harder and prove ourselves. So, it also means that these companies have a lot of confidence in us and our technology."
Dotting the I's
"And also, I'm genuinely pleased with NOM as a regional partner, and I hope that as a company, we can also add value to the region," Shulga continues. "I owe a lot to Groningen. I came from Ukraine with no money. I received a scholarship to study here and pursue my PhD. And I received a lot of support from the ecosystem, so I'm truly grateful for that."
"In addition, I am also really happy with NOM as a regional partner and I hope that we as a company can also add value to the region," Shulga continued. "After all, I owe an awful lot to Groningen. I came from Ukraine and had no money. I got a scholarship to study here and was able to do my PhD here. And I just got a lot of help from the ecosystem, so I'm really very grateful for that.'