Hermann Hauser, an entrepreneur and venture capitalist, has been a pillar of the Cambridge tech community since the 1970s. He co-founded Acorn computer in 1978, which played an instrumental role in the BBC Micro project. The BBC Microcomputer System, or BBC Micro, was a series of microcomputers and associated peripherals designed and built by the Acorn Computer company for the BBC Computer Literacy Project, operated by the British Broadcasting Corporation. Acorn won the bid to build a computer to accompany the Literacy Project’s TV programs and literature. Its Proton computer was renamed the BBC Micro, the system was adopted by most schools in the UK and was also sold as a home computer. Acorn also employed the machine to simulate and develop the architecture of ARM ( Acorn Risc Machine) , which was spun out from Acron and renamed Advanced Risc Machines. It will sell nine billion microprocessors this year and has a market cap of between £9 billion and £10 billion.
In addition to Acorn and ARM, Hauser, who holds a PhD in Physics from Cambridge University’s Cavendish Laboratory, is a co-founder of numerous companies among them the Active Book Company, which was sold to AT&T, Advanced Telecommunication Modules, which was acquired by Conexant Systems in 1994, E*TRADE UK and NetChannel, sold to AOL in 1998. He is a co-founder of the Cambridge Network, a commercial organization that helps academics network with business people, and a co-founder of Amadeus Capital Partners, a venture capital firm. He has backed five of Cambridge’s eleven billion dollar babies – companies worth more than a billion dollars. Informilo’s Jennifer L. Schenker recently spoke to Hauser, an advisor to the Silicon Valley Comes to the U.K. conference, about Britain’s tech strengths.
Q: How does Cambridge stack up against other tech hubs?
A: There are 1,530 companies in Cambridge now, employing 55,000 people. That is more than any other technology cluster in Europe. We did not have any billion dollar companies in the late 1990s, now there are eleven all together. There are two companies that are worth more than $10 billion: ARM and Autonomy, which was sold to HP for $11 billion. We have four world -class consultancy companies. We have one of the best universities in world. Cambridge was voted number one again in one of the rankings – we are always in the top five – and the city is infused with an entrepreneurial spirit. When there are 1530 companies in close proximity it is in the air.
Q: Health-related technologies represent big opportunities for entrepreneurs. Does Cambridge have strengths in this area?
A. On the life sciences side the work of Francis Crick( an English molecular biologst, biophysicist and neuroscientist, most noted for being a co-discoverer of the structure of the DNA molecule together with James D. Watson) helped spawn a whole history around this space in Cambridge, including a number of Nobel prizes and a number of billion dollar companies built around DNA.There is lot of knowledge about basic genetics; at the life science center in Hinxton near Cambridge more of the human genome was decoded than at any other center in the world.
Q: Why is the government focusing on Tech City in London rather than promoting Cambridge?
A: Tech City is new, whereas Cambridge has been around for a long time. It is a new thing to have an initiative about. You have got to give them credit for that but they ought to refocus on Cambridge.
Q: How has the environment for entrepreneurs in Cambridge changed since the 1970s?
A: Enormously. When we started Acorn Computer there wasn’t any venture capital or any entrepreneurship history. We had to invent it on the fly. In our Amadeus I Fund in 1997 we did 17% of the deals with serial entrepreneurs but this has now risen to 70%, so there has been a big change in the last 15 years.
Q: What role has the government played in stimulating the tech sector in Britain?
A: The government realizes the sector is important and they are supporting us. I wrote a report for the government in 2010 proposing that technology innovation centers be built in Britain and the measure was adopted and 200 million pounds set aside for this. I was on the committee that recommended R &D tax credits which were adopted. If you spend anything on R &D you get the cash back – it is a real cash rebate from the government. The government changed the law so that in the UK pension funds are allowed to invest in VCs. Capital gains tax for entrepreneur was cut down to 10%, now it is at 18% but of course we need to do more.
Q: What role does Silicon Valley Comes to the UK play in aiding the ecosystem?
A: It is such a global game we have got to have a closer relationship with Silicon Valley. It is not just about European companies entering the U.S. Large companies are knocking on our door for help to get a European footprint as well.
Q: What more needs to be done to help European companies scale?
A: Eleven billion dollar companies and two 10 billion dollar companies in Cambridge isn’t a bad start. I expect we will have quite a few more in the next ten years but we need better connectivity with large companies and the undisputed leader in technology, Silicon Valley.