30 Years of building businesses

It has never been easier and cheaper to create a new business, challenge the status quo and disrupt entire industries.

For 30 years I’ve been involved in developing businesses, the past 20 years in the UK technology industry.

I’ve been through a couple of recessions, the destructive years of Britain’s conglomerates selling off unwanted assets, the Asian crash, the dotcom bubble, global financial crises and the rapid rise of technology into everyday lives. I’ve learnt many lessons on the way.

After a business degree in Australia, majoring in accounting and electronic data processing (that’s what computing was called in the early 1980s), I worked for a business supplying electrical goods to 70% of the hospitality and accommodation industry.

We created new methods of financing for our customers, primarily hotels, fitting out rooms with the latest appliances in a world that was about to undergo massive change as new Asian brands appeared from an upstart… Korea.

Moving to the UK in 1985, I witnessed the creation of new methods of consumer credit with the advent of electronic point of sale machines, debit cards and loyalty schemes.

I worked on the algorithms for credit scoring for a major retailer, launching one of the earliest store cards. I project managed a magazine publishing groups installation of the first advertising telesales direct to print platform. This was the start of Big Bang: the sudden deregulation of financial markets in 1986.

After five years in the booming Far East involved in agricultural commodity trading, I returned to a very different UK. The economy was dragging itself out of a recession, growing for the first time in the decade. Large industry was selling off unwanted assets (e.g. the car industry) and coalmines were closing.

I joined Thorn EMI plc in 1994 when it too was selling businesses at a rapid rate as it aimed to return to its roots as a music business. Then a major defence contractor and diverse conglomerate of electronics businesses, the EMI Central Research Laboratories had been core to the array of technologies and businesses that were developed over the previous 60 years.

EMI had conducted pioneering research into stereo sound recording many years prior to the perfection of the medium in the early 1950s. The labs had also been responsible for major advances in radar equipment during the Second World War and, post-war, broadcast television. It was the development of the UK’s first transistorised computer (EMIDEC in 1958) that led onto the Nobel Prize-winning CAT scanner.

This revolutionised medical imaging. Flush with this success and brimming with mounting Beatles royalties, the labs were given an ever-increasing remit to pursue commercial innovation.

Thorn EMI had been formed through the merger of Thorn and EMI in 1979. Thorn was then the UK’s largest manufacturer of television sets and EMI a diversified entertainment and electronic instruments conglomerate. In attempts to develop an electronics group, Inmos, a microchip manufacturer, was acquired in 1984, but an attempt to purchase British Aerospace failed.

During the following decade businesses as varied as Thorn Lighting, Heating, Metal Industries, Thames Television, Radio Rentals, Missile Electronics, Data Sciences, Thorn Security, Kenwood, Ferguson and Electro Optics were sold. These sales were completed with the aim of leaving two distinct divisions, music and rental, both world leaders.

As one of the directors of the remaining non-core businesses, we established Scipher in 1996 as a management buy-out (MBO) vehicle. We acquired the Central Research Laboratories for £3.2m following the demerger of EMI from Thorn EMI plc. I was instrumental in structuring the deal entirely as debt and for the vision of Scipher as an IP generator.

Scipher went on to be listed on the London Stock Market via an Initial Public Offering in February 2000, valued at £330m. This blasted us into the 2001 Sunday Times Rich List.

Scipher created a technology development model, built on the strong intellectual property foundations and the 150 scientists and engineers we had acquired. Scipher was a hybrid business incubator and accelerator based on customer-funded research and development.

We developed technologies such as:

  •       Sensaura, 3D positional sound, was shipped on more than 24 million game consoles and 150 million PCs, representing more than 70% of the world's audio chips for PCs. Additionally, Sensaura was licensed directly for the first Microsoft Xbox and available on Sony PlayStation2 and Nintendo GameCube. Sensaura was ultimately sold to Creative Technology.
  •     Micropix, made high-resolution microdisplays for the military, medical imagery, virtual reality and high-definition image processing industries. The business was spun-out to create Forth Dimension Displays, which was funded by Amadeus Capital Partners Ltd and Doughty Hanson Technology Ventures. In January 2011 ForthDD was acquired by Kopin (NASDAQ:KOPN).
  •        MediaTag embedded unique codes in content, which was automatically detected by broadcast monitoring systems. MediaTag established the only UK-wide system to monitor the use of copyright material on more than 120 radio stations. It was used in cable TV monitoring systems in Latin American countries for seven major US media companies. 
  •        Wavelength Digital provided wireless systems that transmit colour video, audio and broadband data signals where it was impracticable to use cable links. Its technology is used on train/platform wireless intercommunication on London's Docklands Light Railway and at Gatwick Airport.  Wavelength was sold as an MBO, forming Wavesight, which was later purchased by Jaltek Group.
  •        Advanced carbon monoxide sensing technology business Monox Ltd, which was sold to Invensys, now part of Schneider Electric.
  •        SpectraProbe, Scipher's joint venture with AstraZeneca, manufactured advanced sensor-based process monitoring instruments for the chemical industry. Scipher’s IP contribution was valued at £30m.
  •       Purple Voice, VOIP communications used in stock brokerages, was sold to IPC Information Systems.

I formed a joint venture with the Malaysian Government’s Science Ministry to take Scipher technology from the labs to their local manufacturing sector. This was scuppered by the Asian financial crisis in 1998.

QED Intellectual Property, the global IP licensing business that I managed from 1998-2003, developed the standard outsourced revenue share model for patent and technology licensing.

We worked for corporations such as BT, IBM, Deutsche Telekom, KPN, Toyota and Imagination Technologies to exploit their IP portfolios through enforcement of patent rights to generate licensing income. We licensed or sold technologies to companies including Philips, Samsung, Furukawa, Alcatel and Mitsubishi.

Analysts stated that the “investment case for Scipher is QED”. We opened offices in the UK, USA and Japan. We merged with yet2.com, the open innovation platform. We then consolidated most of the Fortune 500 as customers. 

Companies such as Intellectual Ventures followed; raising $5bn to secure IP and compete in the rapidly growing market we helped create.

Like Thorn EMI before it, Scipher became more of a portfolio manager than a sustainable business generator. This ultimately suppressed creativity and demonstrated that a leaner, more agile method needed to be developed to build businesses.

Keeping the best technical and entrepreneurial people inside the core is never going to be possible or desirable. The best should, and will want to, run their own business, and in encouraging them to do so, the central business becomes difficult to sustain over the long term.

I left Scipher in May 2003 to become an angel investor and technology strategy mentor.

Businesses that I have invested in, include the development of: an IP valuation platform that is changing how banks use IP as collateral; sustainable aquaculture; retro-gaming for mobiles; building insurance comparison sites; Christie’s collection management system; and, the management of paid subscription and membership websites.

I founded Indycube Ventures to put into action some of the lessons I’ve acquired along the way.


“The lesson for other innovative industries is clear – what matters are skills, culture and networks. Only once these elements are established will the injection of finance have the most impact.” (“Tech Country”, Clark, BVCA, March 2013)


Indycube is Wales’ community of coworking spaces, with 15 sites and more than 350 desks. It is a community interest company, investing its profits into businesses based within the community. I partnered with Indycube CIC to develop Indycube Ventures. It’s not about building a corporate entity, a portfolio manager or even a structured incubator or accelerator like Y Combinator.

Indycube is not funded by government and find that government intervention tends to be the most destructive competition in its market.

Governments should reinforce existing clusters, not try to create new ones. Academic research and hard reality show that governments can’t build entrepreneurial ecosystems. They can give tax breaks to entrepreneurs, employees and angel investors. They can make sure they spend money locally, with SMEs. They can invest in the science and research base through universities and research establishments.

But they can’t “make” entrepreneurs. They can’t do it by subsidising or paying consultants who work for time and expenses. Unless advisers have “skin in the game”, as we do at Indycube Ventures, their advice is risk-free and should be treated as such.

Indycube, as a coworking space, naturally attracts individuals who want to succeed. They are independent. They are entrepreneurial. That they are working on their project or business without expecting government support is in itself a sufficient filter to want to listen to their business pitch. We then assist those that show their proposition solves a real problem for real customers on a large or global scale.

Indycube Ventures assist companies from within the community to become investment ready. We help define their minimum viable product or service. We help them engage their first customer. We do this in exchange for equity, charging no fees at any point. We have attracted service support partners, like KPMG and Capital Law, who see the benefits of supporting startups. Indycube Ventures is about building an entrepreneurial cluster.

Indycube Ventures are about removing overwhelming large structures, with their intrinsic limitations. We promote the creation of flexible, fluid, dynamic, responsive, market-led, agile, customer-focused business models.

It’s never been easier, cheaper or faster to create a new business. After 30 years of building businesses, I’ve seen what works.

Make what people will pay for. Make what customers want.


All material copyright David Hulston Associates Ltd.  @davidhulston1
Meet the team

David Hulston

Indycube Ventures

Indycube Ventures offers funding and expert advice to entrepreneurs. Entrepreneurs and small-business owners based at coworking space network Indycube are being offered access to a half-million-pound annual funding stream and expert advice.



"We have benefited greatly from David's experience, counsel and contacts on a wide range of issues. His past experience in the IP space is particularly useful to Inngot, but even without that, he is just the sort of investor and non-executive director a high growth business needs. He sees potential, makes connections, and keeps us focused on the things that matter."Martin Brassell, CEO, Inngot Ltd