Cambridge essential to Autonomy’s future
To the many other talents of Autonomy Corporation CEO, Dr Mike Lynch, should be added his supreme capabilities as a myth buster. A string of failed Cambridge software companies from the '60s and '70s blamed their demise on the fact they stayed in Cambridge instead of heading for California.
A legion of analysts and investors down the years claimed that no technology business in Cambridge could grow to any size, adding that Cambridge entrepreneurs lacked the appetite and ambition to take their companies beyond a certain scale.With Autonomy, Dr Lynch co-founded and has built a world-leading software business from a Cambridge base - one with a market capitalisation of $7 billion. Neither his appetite for the challenge of masterminding a global business in a fiercely competitive arena, nor his ambition for further growth have diminished. The really good news for this region is that he continues to regard Cambridge as absolutely pivotal to the company's strategy to pack on further muscle in a niche space that Autonomy created and made its own – Meaning Based Computing. In Business Weekly's view, what Dr Lynch has achieved with Autonomy puts him as close to a Bill Gates figure in terms of technological influence as Cambridge is ever likely to see. On a pro rata basis - given their roots, start-points and the contexts of the companies within their respective timelines and marketplaces - Dr Lynch's achievements and talent stand comparison with Microsoft's co-founder. Autonomy was founded 21 years after Microsoft Corporation. It burst onto the scene in 1996 and began leveraging a unique combination of technologies borne out of research at the University of Cambridge. Information is power - but only if you know how to properly structure it, access it and exploit it. Autonomy is global leader in infrastructure software for the enterprise that helps organisations derive meaning and value from their information. As Dr Lynch explains: "Human-friendly or unstructured information is not naturally found in the rows and columns of a database, but in documents, web pages, presentations, videos, phone conversations, emails and IMs.We are facing an increasing deluge of unstructured information, with 80 per cent now falling into this category and, according to Gartner, the volume of this data doubles every month. As the amount of unstructured information multiplies, the challenge for the modern enterprise is trying to understand and extract the value that lies within this vast sea of data, whilst minimising the risk."Dr Lynch's founding vision was to dramatically change the way in which we interact with information and computers, ensuring that computers map to our world, rather than the other way around. Many companies believe that access to information is the answer to dealing with the unstoppable spread of information of all forms – if people can find information, they can process it themselves. Autonomy believes that although access to information is important, there is far greater value in forming an understanding of data and automatically processing it, freeing up people to focus on higher-value activities that computers are unable to do. What Dr Lynch and Autonomy have effectively done is to bring order to what can often be internet anarchy and cut the enterprise free of chains that often hold them in a data dungeon.The fact Autonomy's solution has the added benefit of helping companies mitigate the risks associated with their data assets, explains why so many world-leading law firms and banks have swelled the ranks of blue chip clients. Dr Lynch, a Cambridge University alumni, is one of very few academics - certainly in Europe - who have made the successful transition to technology entrepreneur and taken a start-up through to global leadership. Business anoraks revel in Wiki-style trivia, for example, "his mother was a nurse and his father a fireman" – as if such ancestral alchemy might be construed a barrier to a bright and ambitious young man becoming a technology icon.Mike recalls that his father "advised me to get a job that didn't involve running into burning buildings," although nothing clearly extinguished the young man's blazing hurry to reach the top. Despite his relentless schedule, Mike puts plenty back into the Cambridge community. He has just joined the board of Cambridge Enterprise, the university's commercialisation vehicle, and has been princely with his time in aid of academic and entrepreneurial events. Cambridge is precious to him. He says: "Cambridge is important to me and to Autonomy for a number reasons. It's about the people; you have to be where the people are. The university attracts the very brightest people from all over the country and around the world. And it's a pleasant place; I have an affinity with it. I graduated and have ties here. As a company, we have access to the most amazing research and world-class expertise - and all just an hour away from London with access to good airports."We are where the right people are in an ideal eco-system; it's a virtuous circle. Cambridge is the premier science university in the UK and No.1 in the world in the eyes of some observers. If you were starting from scratch you would be hard pushed to pick somewhere just as good as Cambridge; it's a world-class place to be in business and when you run an international company you don't want to be too far away from London."Given all of this, it's sad that we produce this great output of wonderful students yet in the past we have not always been able to reap the economic benefit. Too many have left to go to Silicon Valley to find success. My hope is that in future we can harness the great ethos we have here to generate wealth, do more world-class research that leads to global enterprises and retain more of our home-grown talent. I want to do anything I can to help achieve those aims."Autonomy's success has proved that global growth to world leadership is possible from a Cambridge base with the right proposition and people. But looking at where the company stands today against his original vision for the business, Mike admits: "It would have been beyond my wildest dreams to imagine we'd be looking at a $7 billion market cap today. But technology people don't tend to look at things that way; they want to change the world and see their technology everywhere."Technology is as cyclical as farming. The work on a farm isn't the same 365 days a year; there are certain jobs you do in summer because you can't do them in winter. Uses for technology evolve and you have to be aware of different applications and opportunities. What you did in the dotcom boom you cannot necessarily do in more straitened times. That's one of the sad things I sometimes see with young Cambridge companies; they'll decide on one thing but it's not what the market wants – yet they carry on doing the same thing regardless."There are times you need to use your IP and change tack, to be flexible and try to predict what the market may want in five years time." As a young company making its way, Autonomy took on board very early the need to gain traction in the United States. Its strategy has brought handsome dividends in recent years with a string of high profile contracts with corporate America as well as within the homeland security arena, where Autonomy's IDOL (The Intelligent Data Operating Layer) has proved an absolute Godsend.Having Richard Perle as a non-executive director can hardly have harmed Autonomy's cause in that regard, although Dr Lynch says Perle's appointment was never used in an influencing capacity with the White House. Perle, of course, worked for the Reagan administration as an assistant Secretary of Defense and served on the Defense Policy Board Advisory Committee from 1987 to 2004. He was chairman of the Board from 2001 to 2003 under the Bush administration. Just as leveraging the American marketplace was key to Autonomy's continued growth, so was its ability to understand behavioural patterns within the majority of business sectors.As Dr Lynch says: "We didn't predict the whole financial meltdown but we did understand that big companies, banks, law firms and so on handled massive amounts of data across their websites and that without structure this carries inherent risk. So when the financial meltdown happened, our IDOL solution was instantly identifiable as an ally."There is a rising tide of information passing across company websites. As this information continues to grow, organisations require technology that is able to unify information scattered across an enterprise, make sense of the data, and instantly connect people with the relevant information required to drive business success. Our IDOL software provides this key solution."Autonomy is able to be opportunistic in an evolving business climate because of the versatile capabilities of its core technology at any given time. As Mike says, it isn't in the business of selling ice cream in the winter. Its rationale is to consistently identify the next big potential application for the software. Focus and selection are key.Dr Lynch said: "I'm not a list maker, in terms of waking up every day and making a list of X number of things to do. "The art of being successful is taking a list of, say 198 items and cross off all but the top five. If the other items on the list were really important they'd be in the top five. The message has to be to focus on what really matters and not get sidetracked."Going forward, all the signs point to Autonomy software being as ubiquitous in IT industry databases as ARM architecture is in chips. One thing is certain: Whatever happens in Autonomy's future will be seized on by City analysts and industry pundits with great alacrity.It's hard to pick up a paper or scan the internet without someone, somewhere speculating on Autonomy buying someone or being swallowed up by an IT behemoth.Irritating as such idle speculation can be as it startles an unsuspecting market and sends the share price on an unwarranted bungee jump, Dr Lynch treats all the imposters with equanimity.Where once he would be riled by various constituencies remotely manipulating the share price, he has come to understand that no-one makes money out of a static stock and he isn't about to play Canute as the tide ebbs and flows."As a public company you have to live with it. I think it's understood that if you can get a good rumour going on a major company you can make £50m. One gets tired of being quoted on things you never said and it would be nice if we only ever had to deal in facts but to bridle against it as CEO of a quoted company is a bit like a sailor complaining about the sea; you take what comes."What comes Autonomy's way will bear a Cambridge hallmark. Mike says: "Continuing to grow globally from a Cambridge base isn't a negotiable option - it's an absolute necessity - to ensure we continue developing our core R & D and produce the talented people that have helped us to our current success."And Cambridge itself has matured as a cluster. It is in a completely different situation now. When I started it would have been hard to envisage any company operating locally going from start-up to world leadership as ARM and Autonomy have done - and perhaps eventually CSR will do."Dr Lynch is also buoyed by the opportunities that will be presented to Autonomy as the march of technological advance gathers pace in a cloud computing and convergence age."When I was a kid the thought that one day I could be talking on a phone that wasn't connected to a wire and the wall would have been absolutely unimaginable. It's hard to predict where technological advance will lead us but I've lost none of my enthusiasm for the ride."