DR HERMANN HAUSER CBE FREng FEATUREPROFILE AN INSPIRING ENTREPRENEUR DR HERMANN HAUSER CBE FREng

Newcomers to most professions have role models that they can look up to and hope to emulate. As an investor in high-tech businesses, Hermann Hauser had to make up the rules as he went along. There just wasn’t anyone else in the UK turning research into profitable new businesses. Now he is a role model par excellence in a world that takes it for granted that and innovation go hand- in-hand. Michael Kenward caught up with him at his London HQ. Hermann Hauser © Schofield Publishing

It all started with an investment might be something in this GROWING ACORN innovation was mostly in the interesting period,”says Hauser. labels Hauser as being in CHIP OFF THE hands of large companies that But it wasn't all bad news. Yes, ‘Computers’. Yes, Hauser’s first of £50. Hermann Hauser was ‘personal computer’ business, he In March 1979, Curry and Hauser OLD BLOCK took for ever to commercialise the revenue did plummet, but success was with Acorn fresh out of his PhD research talked it over with Hauser. The created Acorn as a separate Perhaps because his father was new technology. Acorn stayed in business for Computers, which gave birth to that involved measuring young PhD tapped into his company. Acorn went on to something of an entrepreneur, Acorn changed that. “We another 12 years or so. Hauser ARM, the designer of chips with chemical reactions using network of fellow IT experts at build a successful business on albeit in the somewhat lower- were the first company in Britain also stayed with Olivetti as Vice low power consumption, but in computer analysis of and decided that the back of the phenomenally tech wine business in Hauser’s to go from zero to a hundred President of R&D for three years. reality, computers are just a part calorimetric data, at the there was indeed a business successful BBC Micro. home country, Austria, he did million pound turnover in five of the portfolio for Amadeus in opportunity here. Microcomputers are not flinch at the lack of security. years,”says Hauser. “There are Capital Partners, the business Cambridge University. He had The pair’s first move, in ubiquitous now and plenty of Instead, he asked, “How much still not that many companies A MAJOR PLAYER that he set up with Anne Glover to find a way to earn a living. December 1978, was to create high-tech companies have For all the ups and downs at does it cost?” that have managed that.” and Peter Wynn in 1997 to invest Like many Cambridge physicists Cambridge Processor Unit Ltd. achieved spectacularly rapid Acorn, Hauser’s £50 has grown a Back then, the bill was just It didn't last, though. “The in new technologies. before him, Hauser’s first Operating as an IT consultancy, growth, but it was very different lot since that early investment. £100, £50 each. This was market collapsed around our When we spoke, Hauser thought was to look for a the business had its first success in the late 1980s. In those days, The latest Sunday Times rich list enough to allow Hauser and ears.” After a torrid period, with enthusiastically described a new lecturing job. Chris Curry using microprocessors in a high-tech businesses didn't credits him with being worth Curry to start a business that creditors banging on the door, motor technology that might interrupted the job hunt when controller unit for a fruit machine. spring into being and soar into £125 million, putting him at became . Hauser and Curry did a deal with revolutionise electric vehicles. he turned up and asked, “Fancy the stratosphere in just a few number 557 in this, some might Curry already had a track Olivetti which eventually “The excitement about the setting up a company?” years. Outside of the USA, say, spurious league table. record, as a part of Sinclair became the majority owner of electric motor has a lot to do where technology start-ups This probably isn’t the most Radionics. Sensing that there Acorn. “Then there was a very with the system that you can were beginning to make waves, reliable of sources as after all it

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build and run the control needed to be better at that which pioneered short range ventures “all vaguely related with models which are “an often structure of the electric motors, element of his work. radio links through technologies silicon”. neglected part of the story,”says not just the motor itself. This is a People knew that he was, as such as Bluetooth and was the Hauser himself has sat on the Hauser. Should a company very different way of looking at he puts it, “a sucker for winner of the prestigious Royal boards of more than 20 manufacture, say, chips? Or building a vehicle.” technology”. So they turned to Academy of Engineering prize, technology start-ups. In the should it design them and sell him for investment funds. “I was the MacRobert Award, in 2005. process, along with the the rights to other companies to one of the very few people in successes he has made mistakes, make them for their products? BACKGROUND Britain at the time who had this and seen others make their fair That is the way in which ARM RESEARCH amazing deal flow of high-tech SELLING HIGH share. All this adds up to the sort works. Or implement another Amadeus, and Hauser, made a Hauser can also switch effortlessly business plans. I was probably of knowledge that simply isn't a model where “you can capture packet when CSR went public. into ‘biojargon’with an account of about 50% of the business angel part of the experience of most all the cleverness in the design Many predict a similar fate when the complicated genetic science money in Cambridge. I just people starting new businesses. and just farm out the another of Amadeus’s behind one of Amadeus’s could not handle that deal flow manufacture to the big investments, Plastic Logic, investments. “My bedtime any more.” semiconductor fabricators.” eventually reaches fruition. reading at the moment is ATTRACTING TALENT “We have to think business Plastic Logic is a spin out from These are areas where Hauser molecular cell biology,”he models through every one of Hauser’s old stomping ground, thinks that venture capital explains. “I am just finishing the BUSINESS INTUITION our investments,”says Hauser. In the past, he says, he had relied the Cavendish Laboratory, where investors can play a crucial role. book that they use on the “The investment itself has to on “gut instinct”. “I didn't do Professor Richard Friend and As well as making connections molecular cell biology course at think it through only once. We badly out of these investments,” Professor Henning Sirringhaus with larger businesses, MIT.” He is also a believer in are not any smarter than other says Hauser. “But it was not a very laid the foundations for experienced venture capital studying systems biology as a people, it is just that we do it professional way of assessing the electronic materials that are investors with a good track way of understanding complexity. more often.” Does this mean that Hauser deals.” suitable for low-temperature ink- record can persuade first class has to become an instant expert Working out of an area that jet printing. managers to take a leap of faith, on the technologies that he recently hit the headlines for Amadeus doesn’t just bring give up well paid jobs in large NEW LABOUR, invests in? “That is probably the having the highest rents in the in the cash, it has unbeatable corporations and run tiny new NEW OUTLOOK most exciting aspect of my job,” UK, Amadeus set out to change connections. It can put fledgling ventures on the understanding Recent political changes have he says. He admits that he set all of that. Amadeus’s current businesses in touch with larger that if everything goes to plan, also improved the prospects for © Schofield Publishing up Amadeus partly because he portfolio runs to some 50 businesses that might be they will end up with a large pot innovators. “Tony Blair and businesses, in sectors that as well customers, for example. Along of money when it comes to Gordon Brown were the first two as Hauser’s traditional IT with all of those businesses selling their share of the leaders of this country ever to Amadeus set out to change all of that. Amadeus’s current portfolio investments, include the life successfully floated or sold, business. Enough people have bother to come to Cambridge to runs to some 50 businesses, in sectors that as well as Hauser’s sciences, media and e-commerce Hauser reckons to be rare in believed in Hauser’s track record look at the so-called Cambridge and software. Europe in having a hand in to have done just this. phenomenon,”says Hauser. “And traditional IT investments, include the life sciences, media and The software investments are launching three, billion-dollar Then there are the business themselves a diverse set, e-commerce and software. including Active Navigation, a spinout from the University of Southampton, which is in the business of helping organisations ACHIEVEMENTS to make the most of large Education Dr Hauser obtained an MA in Physics from Vienna University. He also holds a PhD in Physics from unstructured databases. An the University of Cambridge. earlier investment, Entropic Research Laboratory, was a 1978 co-founded Acorn Computers, leading the development team towards the production of the BBC Micro speech recognition software company that ended up being Computer. 1986 Made a member of the Esprit Advisory Board. 1990 Honorary Doctorate University of Bath. bought by Microsoft. 1997 co-founded Amadeus Capital Partners Ltd, investing in early stage European technology companies. Better known businesses that 1998 Honorary Doctorate . 1998 Made a Fellow of the . benefited not just from the 1999 Honorary Fellow of King’s College, Cambridge University. 2001 Honorary Doctorate Anglia Polytechnic investor’s money but also from management guidance, include University. 2001 Honorary CBE for ‘innovative service to the UK enterprise sector’. 2002 Made a Fellow of The Cambridge Silicon Radio (CSR), Royal Academy of Engineering. 2004 Made a member of the Government’s Council for Science & Technology.

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Hauser remains optimistic about innovation in the UK. No longer considered a maverick, he is doing his bit to ensure that future generations of Cambridge researchers don’t have to negotiate such a steep learning curve.

they took it seriously. We always reduce the level the longer you had an opportunity to talk to hold the investment. After all, them and to tell them what the funds investing in new problems were.” technology ventures usually have Hauser has himself had a hand to wait at least five years before in the development of they can realise their investment. government policy. He is currently a member of the Council for Science and PENSION FUNDING As yet there has been no sign of Technology, which describes backtracking on another itself as “the UK government’s important result of the Williams’ top-level independent advisory IBC report. “We also recommended body on science and technology the British equivalent of the policy issues”. He was also a prudent-man legislation in the member of the influential States.” committee, chaired by Sir Peter A visualisation of the East Forum, Cambridge The legislation basically said Williams, which was, he says, “the that a pension fund, acting as a learning curve. After minor contemplating the choice most successful government Do Not Use prudent man, can put small delays, while Cambridge fought between physics and business, body that I have ever sat on”. amounts into high risk private over the university’s regulation Cambridge was rare among The committee’s report, equity ventures. “That opened of intellectual property rights, universities in having anyone Financing of High Technology up the opportunity for pension work can finally begin on a new working seriously to turn Businesses, paved the way for R&D funds to invest in venture capital building, called the East Forum, research into profits. But even tax credits and ’taper relief‘ for much more so than they had in that Hauser is funding. there it was a hand-to-mouth capital gains to recognise the the past.” Just along the road from the affair, run out of a cramped time it can take for an investment Before this legislation, the Cavendish Lab, the new building office in the middle of the town. to deliver any returns. UK’s insurance funds had put will house the Cambridge Somehow, though, you wonder something like 0.8% of their Entrepreneurship Centre and will if Hauser would have had quite BACKTRACKING? money into supposedly ’risky‘ be the base for the university's so much fun in his own career as Hauser is less than pleased by the investments like venture capital corporate liaison office and will an innovator had professional recent proposal to tamper with funds. In the USA it was more be what Cambridge has support been so readily available this taper. “I think it has already like 8%. Now in the UK it has described as “a stepping stone in the 1970s. done a lot of damage in terms of grown to around 2%. between Cambridge research the government being perceived and business”. as backtracking on their BUILDING A BRIDGE Back when Hauser was commitment to support All in all, then, Hauser remains entrepreneurship.” He isn't taking optimistic about innovation in this lying down and has joined the UK. No longer considered a BIOGRAPHY: Michael Kenward OBE the industry in speaking out maverick, he is doing his bit to Michael Kenward has been a freelance writer since 1990 and is against the proposals. He even ensure that future generations of a member of the Ingenia Editorial Board. He is Editor-at-Large has a solution: start off with a Cambridge researchers don’t of Science|Business. higher tax on capital gains and have to negotiate such a steep

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