Mike Lynch, who has been reported missing after the yacht he was on sank in a storm off the coast of Sicily, experienced some of the most extreme career highs and lows of any British technology entrepreneur.
A self-made software success story, Lynch went on to become a prominent investor in — and vociferous champion of — the UK tech start-up scene. The $11bn sale of his company, Autonomy, to Hewlett-Packard in 2011 was at the time the biggest ever of a European IT concern, cementing his position as the rare head of a British tech company to make it on the global stage.
But a year later HP claimed Autonomy’s leaders had fraudulently inflated the value of the acquisition by $5bn, leading to a 12-year legal ordeal. Lynch lost a long battle against extradition to the US on fraud charges and spent more than a year under house arrest in San Francisco ahead of a trial. He was eventually cleared by a jury on all charges in June this year.
Lynch, 59, was among those missing after the yacht Bayesian, of which his wife was the official owner, sank in severe weather early on Monday morning in the Mediterranean.
Six of the 12 passengers and 10 crew members aboard were declared missing, among them Lynch’s 18-year-old daughter, Hannah, while one crew member died. The passengers included members of Lynch’s legal team and a witness for the defence, who he had invited to celebrate his courtroom victory.
The long journey that brought Lynch to a 56-metre, luxury “superyacht” began from humble circumstances. Born in Ilford, Essex, and brought up in nearby Chelmsford, he liked to talk about the hardships he faced during his upbringing. Taking the stand at this year’s trial, he said that being the son of Irish parents made him something of an outsider, especially during the political turbulence of the 1970s, when “there were times you had to learn to run fast”.
He was awarded a scholarship to Bancroft’s, a private school in Woodford, Essex, but claimed to shun the trappings of social status. He told the jury that his first job involved mopping floors in a local hospital, and said: “As a 16-year old . . . you realise that whatever it is you want to do, just do it.”
Lynch went on to study natural sciences at Christ’s College, Cambridge university, and later completed a PhD in signal processing, specialising in a technique used in fields such as mobile communications to separate the signal from the noise in digital data. By the late 1980s he had begun turning his expertise to entrepreneurial use with a series of start-ups, beginning with one that designed a device used to sample music.
He founded Autonomy in 1996 just as an explosion of digital data was starting to engulf companies and other large organisations, presenting huge challenges in sorting through unstructured data, or information not held in easily searchable databases. The sale to HP confirmed Lynch’s success at carving out a globally recognised position in one of the most strategically important technologies of the time.
However, HP boss Meg Whitman accused Autonomy’s leaders of having falsely inflated the company’s revenues in the years before the sale through tricks such as “round trip” deals, where Autonomy paid customers in return for them buying its software. Lynch threw himself into his defence in the years that followed, turning the battle into a personal vendetta against Whitman, who he accused of inventing the fraud claim to cover up her own mismanagement of the foundering US tech company.
Autonomy’s former chief financial officer, Sushovan Hussain, was convicted of fraud over the Autonomy sale in the US in 2019 and HP won a civil fraud claim against Lynch in the UK in 2022. Despite these successes, US prosecutors stumbled when trying to prove that Lynch, as the company’s CEO, was criminally responsible for the alleged fraud.
The jury was presented with two very different versions of the software boss. Prosecutors painted him as a domineering micromanager, while the defence depicted him as a big-picture tech strategist who did not pay attention to the complex accounting issues at the heart of the fraud claims.
“I’m not an accountant . . . and I’m not a salesperson,” Lynch said, successfully persuading the jury that he was not familiar with the convoluted financial dealings presented in court. “I’ve sat and watched a parade of witnesses that I’ve never met . . . and a series of transactions I had no involvement in, and not much else.”
Though he was ultimately cleared, the indictment in the US cast a long shadow over Lynch’s career. Along with a personal fortune — he reaped more than $800mn from his stake in the company — Autonomy had earlier provided him with a platform to champion the cause of tech start-ups and take a prominent role in public life.
Lynch served as a non-executive director of the BBC and a member of Prime Minister David Cameron’s council for science and technology, where he advised on the importance of the coming wave of artificial intelligence. He was granted an OBE in 2006 for services to enterprise.
After charges were brought in the US in 2018, he stepped back from many of his public roles. However, he continued to make investments through Invoke Capital, the venture capital firm he set up after the sale to HP.
Recently, in his first public comments since the trial, Lynch told The Sunday Times that he wanted to provide support for people who had been wrongly convicted of crimes, and to fight against what he believed was the injustice of extraditions such as the one that had forced him to face trial in the US.
“The system can sweep individuals away,” he said: “There needs to be a contrarian possibility that’s saying, ‘Right, well, the whole world thinks you’re guilty but, actually, was that a fair conviction?’”
Read the full article here
