11 December, 2013 - 08:42 By Tony Quested

HP has handed Lynch the keys to the safe

It was obvious to everyone apart from HP that when they showed Cambridge UK technology entrepreneur Mike Lynch the door following the acquisition of Autonomy they were committing commercial hara-kiri.

Marginalising the founder of a technology business is dangerous enough. Sending one into apparent exile can be fatal.

It should be obvious by now – even to the myopic management at HP – that Dr Lynch is in the advanced stages of building Autonomy II and Son of Aurasma.

Lynch’s lieutenants from both businesses are now safely ensconced within his new and burgeoning business empire in the Cambridge-London corridor. Some are with Invoke Capital, his £1 billion software investment fund; others are leading Cambridge companies Featurespace and Neurence/Taggar.

You only have to look at Lynch’s backing of predictive technology specialist Featurespace and Invoke’s first two investments to release the damage HP has inflicted upon itself.

The maiden investment Darkspace has every chance of dominating in the cyber security field and alongside Featurespace, take meaning based computing and predictive software onto a fresh plateau globally. Other pieces will be added to this jigsaw and the finished picture will be a turbocharged alternative to Autonomy.

The second Invoke investment is in Cambridge startup Neurence, which already has a global lead in a highly specialised aspect of augmented reality – a space in which Aurasma felt it had stolen a march.

Neurence was founded by techies at Aurasma who followed Lynch out of the HP/Autonomy door and approached him for funding. Neurence has developed a cloud-based intelligent recognition engine that handles image, audio and video data. Any device can stream information to Neurence, which understands and recognises it.

Neurence then instantly sends back appropriate and useful information to each device. Outsourcing the processing of information to Neurence removes the need for additional processing power on the device itself.

The baby in this new marriage is Taggar – the first social augmented reality app – which applies Neurence’s recognition technology to smartphones for the first time.

With Taggar, users can create and share their own content on any object in the physical world. Taggar’s social augmented reality architecture makes all new creations available instantly to users around the world.

Put it all together and you see how the divorce from Lynch could prove particularly painful and costly for HP. The US giant could now lose whole chunks of what should have been core business following its acquisition of Autonomy and Aurasma and – adding bitterness to the dose they are having to swallow – losing that trade to a man they chose to kick out.

So not only has HP failed to add value to the Autonomy acquisition, it has personally facilitated the loss of expertise and potential revenues.

There is a wider issue here, of course – the whole aspect of retaining a founder’s knowhow and passion within a business when a company is acquired or major investors want to take it in a new direction.

I understand that Neul co-founder James Collier is on the cusp of leaving to set up a new venture – possibly with input from ARM and well funded – to explore his original dream for the wireless venture launched to exploit the new white space radio/TV spectrum and the wider IoT/M2M arenas.

His view of where Neul should be positioned is said to be substantially different from the strategy CEO Stan Boland was brought in to pursue for lead investors.

There is no right or wrong in such matters. Intelligent technology pioneers and the people who fund them are often at odds over commercialisation strategy.

DisplayLink was as close to a near-death experience as any tech venture locally before the founders were eased aside and a more overtly commercial approach embraced. The company is now a cash-making machine with fantastic headroom for nextgen technology.

As in so many cases that would not have been possible without the founders who had the original idea. But the fact has to be faced that not all ideas people are either interested in or particularly adept at the technology transfer and sales aspects of a business.

Clearly Mike Lynch is a different animal – an innovator with a hard sales edge who will not brook complacency in the commercialisation process. While James Collier proved his nous with the commercialisation of CSR’s technology that was in partnership with highly sales savvy colleagues like Phil O’Donovan.

So the founders versus investors/acquirors issue comes down to fine judgement; not all founders have to be thrown out like so many babies with the bathwater. By the same token, they should not be left to linger in nappies with others tasked to clear up their mess.

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