Long before he was dubbed by the press as the UK’s answer to Microsoft founder Bill Gates, Mike Lynch, 59, rose the ranks as a British-Irish serial tech entrepreneur who co-founded a software firm Autonomy and a cybersecurity company Darktrace, and launched UK-based venture capital firm Invoke.
Autonomy’s success - its software could extract useful information from unstructured sources including phone calls, emails and video - made Lynch one of the best-known British technology executives.
He was named Entrepreneur of the Year by the Confederation of British Industry in 1999. In 2000, Time magazine named him one of the 25 most influential technology leaders in Europe.
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He was awarded an Order of the British Empire for services to enterprise in 2006. The same year, he was appointed as a director to the board of the British Broadcasting Corp., the world’s biggest public broadcaster.
He advised two British prime ministers, David Cameron and Theresa May. Forbes estimated his net worth to be $1 billion in 2015, the sole year he was named to its list of global billionaires.
Acquisition troubles
However, in recent years, the Cambridge-educated mathematician has been seeking to restore his reputation as one of Europe’s most successful entrepreneurs, arguing that he had been scapegoated over the 2011 acquisition of his brainchild, Autonomy, when it was entangled in a series of litigations.
Hewlett Packard Co. (HP) paid $11 billion for Autonomy then, only to write down $8.8 billion of the purchase price a year later. Lynch was fighting the Silicon Valley giant in a UK case, where he was held responsible for creating the illusion of a company much larger and more successful than it really was.
Lynch made at least $500 million from the HP deal. He then set up venture capital firm Invoke Capital, founding a series of tech companies run by former employees. His most successful venture was Darktrace, a business that uses AI to detect suspicious activity in a company’s IT network.
Mounting pressures
So while HP’s acquisition was first seen as a validation of UK technology, in 2012, HP alleged Lynch and Autonomy’s former finance chief used accounting tricks to inflate the company’s revenue ahead of the 2011 sale. The lawsuit followed. The trial placed huge pressures on the tech tycoon, who was forced to wear an ankle monitor and confined to 24-hour supervision by private security guards he had to pay for.
After one of the longest and most expensive trials in British history, it was ruled in 2022 that Lynch and Autonomy had fraudulently boosted the value of the company. It was still to be decide what damages Lynch would have to pay. HP was seeking $4 billion from him and his finance chief, but it was likely HP would get substantially less than that.
Those looming penalties from the civil suit did not dent Lynch’s ambitions once he was released from house arrest in the US. “I am looking forward to returning to the UK and getting back to what I love most: my family and innovating in my field,” Lynch said in a statement after he was cleared of criminal wrongdoing.
- With inputs from Bloomberg
