Tennessee Announces $3 Million Commitment to Support NSF X-Labs Quantum Teams

NASHVILLE, Tenn. - Today, Gov. Bill Lee and Deputy Gov. and Tennessee Department of Economic Development Commissioner (TNECD) Stuart C. McWhorter announced a $3 million funding commitment to support National Science Foundation (NSF) X-Labs quantum teams that choose to establish research, commercialization or business operations in Tennessee.

The investment is designed to help winning NSF X-Labs teams accelerate commercialization while leveraging Tennessee's nationally recognized quantum ecosystem, including Oak Ridge National Laboratory, the Tennessee Valley Authority, EPB, other leading research universities and the state's growing innovation and manufacturing base.

"Over the past few years, Tennessee has earned the reputation as having one of the strongest quantum ecosystems in the country," said Gov. Lee. "This investment will help ensure that the companies developing tomorrow's quantum technologies will choose our state to grow, cultivate high-quality jobs and bring new innovations."

The Tennessee Quantum X-Labs Challenge will support teams that commit to commercializing their technologies in Tennessee by providing the following resources:

· Up to $3 million in state support

· Access to world-class research and testing infrastructure

· Commercialization support through Tennessee's innovation ecosystem

· Partnerships with industry, national laboratories, universities and utilities

· Workforce development and talent recruitment resources

"Tennessee is uniquely positioned to help quantum companies move from breakthrough research to real-world deployment," said Deputy Gov. and Commissioner McWhorter. "We're shifting our economic development strategy from simply recruiting projects to orchestrating ecosystems where companies and innovators can access the partners, infrastructure, and talent they need to succeed, and today's announcement signals a clear message that we're ready to do so."

Beyond the state funds, LaunchTN is adding a package designed to help X-Labs teams put down roots in Tennessee. Any X-Lab awardee that relocates to the state, along with companies that emerge from the X-Labs program, will receive priority consideration for LaunchTN's SBIR/STTR Matching Fund, which augments federal non-dilutive awards with state capital, and for direct investment through InvestTN to companies that meet program eligibility criteria. Together, these programs give X-Labs teams a clear path from federal award to sustained growth capital, reducing the runway gap that early ventures face and helping them maximize the impact of their NSF funding in Tennessee.

This announcement builds on the $43 million investment that was approved and allocated in Gov. Lee's 2026 budget to further the state's quantum infrastructure and will ultimately position Tennessee as a leader nationwide in attracting advanced energy, quantum networking, and technology commercialization to every corner of the state.