Alphabet's AI Spinoff Raises $300M at $5.3B Valuation Amid Biopharma Partnerships
SandboxAQ, a Palo Alto SaaS startup, operating at the intersection of artificial intelligence and quantum technology, announced it has raised over $300 million in funding, bringing its pre-money valuation to $5.3 billion.
Investors include Fred Alger Management, T. Rowe Price Associates, Mumtalakat, Breyer Capital, Eric Schmidt, Yann LeCun, and others.
SandboxAQ, founded in 2016 and spun off from Alphabet Inc. into a standalone company in 2022, now aims to expand the development of Large Quantitative Models (LQMs) and other AI applications across industries, including biopharma, finance, cybersecurity, and navigation. The company positions LQMs as the "next wave of AI", highlighting their focus on physics-based, quantitative data:
AI can revolutionize discovery by creating novel molecules in seconds, but it relies on high-quality data, which is scarce. SandboxAQ addresses this through Large Quantitative Models, generating its own training data in silico and guiding AI with physics. —SandboxAQ
While SandboxAQ works at the intersection of AI and quantum techniques, it is not a quantum computing company. Instead, it focuses on AI-driven applications, leveraging classical high-performance computing systems like GPUs and TPUs for quantum-inspired simulations and integrating quantum sensors and algorithms into practical tools.
Its technologies include navigation systems (GPS-independent positioning under U.S. Air Force research contract), cryptographic management platforms (post-quantum cryptography and zero-trust security), and AI-powered tools for biopharma that model molecular interactions and biological pathways for drug discovery (e.g. AQBioSim).
Lately, the company has been expanding more into biopharma collaborations:
In 2023, SandboxAQ signed agreements with AstraZeneca and Sanofi to utilize its molecular simulation tools for accelerating drug discovery. These collaborations are part of the company’s AQBioSim division, which combines quantum-inspired simulations and AI to reduce costs, timelines, and failure rates in drug development.
In January 2024, SandboxAQ acquired Good Chemistry, a computational chemistry company specializing in AI and quantum technologies. This acquisition expanded SandboxAQ’s simulation capabilities, adding new platforms like QEMIST Cloud, a SaaS-based computational chemistry tool, and Tangelo, an open-source quantum computing SDK. Good Chemistry had previously demonstrated the ability to simulate and analyze the breakdown of "forever chemicals" (PFASs), contributing to advancements in sustainability and environmental science.
SandboxAQ partnered with Nvidia in July 2024 to integrate Nvidia’s CUDA-accelerated Density Matrix Renormalization Group (DMRG) algorithm into its AI models. This collaboration would enable simulations that are 80x faster than traditional methods and supports applications such as predicting molecular behavior and screening for toxicity. These capabilities are already being applied in drug discovery for neurodegenerative diseases in collaboration with UCSF and other institutions.
By August 2024, SandboxAQ joined the OpenFold consortium, an open-source AI research initiative aimed at advancing tools for drug discovery. The company contributes its expertise in AI and quantum simulations to the collaborative platform, which also includes companies like Astex Pharmaceuticals and Biogen.
SandboxAQ has also expanded into cardiac diagnostics through its CardiAQ device. It partnered with Mayo Clinic to evaluate this magnetocardiography technology, which provides rapid, non-invasive cardiac imaging. Earlier trials at UCSF and Mount Sinai Medical Center demonstrated potential to improve diagnostic accuracy without the need for specialized facilities.
In October 2024, the company announced a collaboration with Sanofi to identify biomarkers using LQMs. This project focuses on developing tools to extract causal clinical hypotheses from knowledge graphs, aiding the understanding of drug mechanisms and improving clinical outcomes.
That same month, the company announced a partnership with The Michael J. Fox Foundation for Parkinson’s Research (MJFF) and Belgium’s KU Leuven. The collaboration focuses on ATP10B, a key gene linked to Parkinson’s disease. Using its LQMs, SandboxAQ will screen compounds to identify modulators capable of restoring ATP10B function, accelerating early-stage drug discovery. The company joined MJFF’s LRRK2 Investigative Therapeutics Exchange program in a $25 million initiative to develop inhibitors and modulators targeting the LRRK2 gene, the most common genetic link to Parkinson’s.
Topics: Startups & Deals
