“Someone’s sitting in the shade today because someone planted a tree a long time ago,” is a Warren Buffett quote so well-known that consumers shopping for the perfect holiday gift can easily find a T-shirt or mug with it.
It’s great if anyone feels inspired by this to plant a tree next spring, but Buffett made his reputation as an investor. He was talking about the value of thinking long term — how, with patience, a small investment can turn into a towering return.
We keep quoting this not because it’s another Buffett gem, but because business executives so easily forget this lesson.
Things that take a long time to reach fruition aren’t inherently better, but groundbreaking products, durable brands and leading market shares aren’t built in a quarter or two.
That’s what’s so interesting about Honeywell’s venture in quantum computing. They get it, or at least enough people did in its recent history to support its development.
Honeywell International announced in the summer that it would spin off its quantum computing unit and merge it with a firm in the United Kingdom, creating a company controlled by Honeywell called Quantinuum. This new company hopefully will attract investors interested in the emerging market of quantum computing. That merger just closed.
Honeywell International isn’t exactly the same Honeywell company previously based in Minneapolis that older Minnesotans may remember. But there is a lot of the old Honeywell’s DNA in Honeywell International.
The quantum computer venture got its start in the Minneapolis suburb of Golden Valley. It was not the kind of undertaking someone with short-term thinking, be it next quarter or next year, would even try. This venture got going more than a decade ago, and Quantinuum only just introduced its first commercial product.
As for the potential, the numbers being tossed around on the potential market size suggest something more than $1 trillion.
And maybe there is something else to be learned about long horizons from Honeywell’s computing project: How to appreciate the value of corporate legacies.
In an account told by Honeywell, more than 10 years ago a new leader in a small new business incubator project assessed what knowledge Honeywell had: Advanced capabilities in optics, lasers, cryogenics, ultra-high vacuum environments and, of course, more than a century of experience with controls.
Honeywell staff scientists pointed out that with this portfolio of knowledge and technologies, the company could build a quantum computer, said the executive who leads the quantum computing business.
Companies are using different approaches to develop quantum computers, but they all promise to be much faster than traditional computers. How it works is beyond my understanding, other than quantum computing moves beyond traditional computing use of binary bits, represented by a 0 or 1, that store information.
In quantum computing the building blocks are “qubits” that are nonbinary and can exist in multiple states at the same time.
Some segment leaders are completely unfamiliar, like Rigetti & Co. or Xanadu Quantum Technologies of Canada, which raised $100 million this year.
Yet the list of known leaders also includes Microsoft Corp., International Business Machines Corp. (IBM) and Honeywell — founded, respectively, in 1975, 1911 and 1885.
It’s been more than two decades since Minnesota lost the Honeywell headquarters, which was then one of the state’s premier corporate leaders, when it was acquired by AlliedSignal. The headquarters first consolidated at AlliedSignal’s home in New Jersey, with Honeywell International now based in North Carolina.
The Honeywell name came from one founder on the corporate family tree, but William R. Sweatt and his descendants are the entrepreneurs who deserve the credit for developing Honeywell in Minnesota.
The Minneapolis-Honeywell Regulator Co. was a controls business, including for regulating heat in people’s houses. Before this kind of technology, when homeowners felt chilly they put more fuel in the stove or furnace and when they felt too warm they had to stop adding fuel. Automating that made life a lot easier.
Honeywell expanded into other lines of business and became, at one time, a big player in the American mainframe computer business.
That was back when the U.S. computer industry was known as IBM and the BUNCH — an acronym that referred to IBM’s five main competitors.
The “U” stood for Univac, with a big presence here in the Twin Cities, and the “C” was for Control Data Corp., based for most of its life in Bloomington and maybe the only real rival to IBM during that period. The “H” was for Minneapolis-based Honeywell.
The rise of this high-tech industry here in Minnesota goes a long way to explaining the transformation of the state’s economy. Personal income in Minnesota went from lagging Midwestern neighbors like Wisconsin in the 1940s to pushing past them by the 1960s.
This mainframe era didn’t last that long and Honeywell exited the business entirely.
It would be stretching the truth past the breaking point to suggest that Honeywell’s quantum computing venture grew from roots in Honeywell’s computer business. Yet it did grow out of Honeywell’s deep pool of know-how and broad portfolio of technologies.
Honeywell now owns 54% of Quantinuum, poised to raise a lot of capital to pursue what sure looks like a big opportunity.
Booming profitability remains a long way off and might never arrive, yet Honeywell’s team deserves a lot of credit for just taking the first big step.
That happened when they realized that with time and money they might be able to build a groundbreaking machine — and then decided to try.