JUST a month ago, Mike Lynch gleefully spoke about making up for lost time and his “second life” after defying microscopic 0.5 per cent odds that he wouldn’t spend the rest of his life in prison.
The tech tycoon, often branded “the British Bill Gates”, had been locked in 12 years of legal battles to clear his name over claims of fraud related to the 2011 sale of his firm Autonomy to Hewlett Packard for $11.7billion.
Prosecutors had claimed Mike and his financial director Shushovan Hussain had “used every accounting trick in the book” to overinflate the value of his business by $5billion in Silicon Valley’s biggest-ever fraud trial.
The 59-year-old had been living under house arrest in San Francisco, US, with just his beloved dog Faucet for company, for well over a year when he was finally acquitted two months ago and spoke about longing to spend time with his wife, Angela Bacares and their two daughters.
If found guilty, he would have been sentenced to 25 years in prison but said he would not have survived due to his age and various health conditions. He was given a 0.5 per cent chance of winning the trial.
To celebrate Mike’s against-the-odds victory, he chartered the £14million superyacht Bayesian owned by him and his wife to sail around the Italian island of Sicily with his family and those close to him – but tragedy struck.
In the early hours of Monday morning, the 56metre vessel sank off the coast of village Porticello during a storm when a waterspout – similar to a tornado – broke the mast and capsized the boat.
Authorities managed to rescue 15 people including Mike’s wife Angela – but the software tycoon, his daughter Hannah, 18, and four others remain missing.
The Bayesian has been found 50 metres underwater on the sea bed, with search and rescue teams unable to reach rooms due to furniture blocking passageways.
In a short statement, captain of the yacht James Catfield told La Repubblica: “We didn’t see it coming.”
Tributes have started to pour in for those aboard the ship – including Mike, who rose from a lowly hospital cleaner to being named the UK’s most influential person in IT.
The tycoon, worth an estimated £852million, was born in the Republic of Ireland in 1965 before moving to Chelmsford, Essex, with his firefighter dad and nurse mum.
His first job was as a hospital cleaner, with him telling The Times: “I’m still a demon mopper. There’s an art form to it, you know.”
But it was his analytical skills that led him to become one of Britain’s respected minds – including in 2011 becoming Prime Minister David Cameron’s science and technology advisor.
Early on, Mike earned a scholarship to private school Bancroft’s, which today charges £8,330 per term, and later a place at Christ’s College, Cambridge University.
He studied physics, mathematics and biochemistry and after graduated with a PhD in artificial neural networks – a type of machine learning – and his doctoral thesis is said to be one of the most widely read pieces in the university library.
‘Late nights & cold pizza’
Mike was involved in a number of start-ups in the Eighties before founding Autonomy, which made him from $516million for his eight per cent ownership stake when it sold in 2011.
The former firms included Lynett Systems Ltd, which created audio products and designs for electronic synethesizer keyboards, after he negotiated a £2,000 loan in a bar. Another was a software used by police that focused on number plate, fingerprint and facial recognition.
In 1996, software company Autonomy was born, which would be used to analyse huge swathes of data from unstructured sources like phone calls, emails and videos.
Describing his small team he said: “Eccentric people working really hard on a project. No bureaucracy. No admin. Lots of late nights, lots of eating cold pizza”.
Autonomy became an instant success and benefitted from the dotcom boom, which led it to join the FTSE 100 of top UK listed companies.
The achievements with Mike, the chief executive officer, at the helm led to considerable praise including receiving an OBE for services to enterprise in 2006.
‘Bond obsessive’
While building his empire, Mike admitted to being “hard-charging” and was described as “blunt and dictatorial” by critics – but he had a lighter, kooky side.
A James Bond obsessive, he named conference rooms after 007 villains, including Dr No and Goldfinger, and even had a piranha tank in the company’s atrium, in a nod to You Only Live Twice. He also drove an Aston Martin DB5, like the fictional spy.
I’d had to say goodbye to everything and everyone, because I didn’t know if I’d ever be coming back.
Mike Lynch
Others compared him to a Mafia boss – and to jokingly lean into that in 2005, he released a corporate video where he dubbed himself ‘Big Mike’ and wore a mob-style fedora as one of his ‘associates’ smashed a phone with a baseball bat.
This didn’t detract from Autonomy’s success – they had 2,000 employees in 20 countries and their software was used by the likes of US phone company AT&T, global bank BNP Paribas and US firm BlackRock.
By 2010, they were able to fork out £20million on a sponsorship deal with Premier League side Tottenham Hotspur and one year later, Hewlett Packard (HP) came knocking.
‘Every trick in the book’
They were reportedly so desperate for the firm they paid $11.7billion for the firm – 64 per cent over the company’s stock market value.
Mike said: “One of the great mythologies was that I had a choice to sell, it would have been like trying to stop a herd of elephants.”
The buyout was seen as a way to save HP, which was struggling financially at the time, but within five weeks of the takeover, shares in the company tanked.
HP chief executive Leo Apotheker, who brokered the deal, was jettisoned and replaced by Meg Whitman, a tech whizz who had recently lost her bid to become California governor at a cost of $140million of her own money.
Mike was fired alongside 27,000 HP workers and other with the vision to make it a success.
HP announced an $8.8billion writedown – admitting they had paid four times the amount Autonomy was worth and later alleged “serious accounting improprieties”.
They alleged Mike and his team had deliberately inflated the value of the company by $5billion with fake sales and financially dishonesty – what would ensue was 12 years of high-profile court battles.
His daughters were just nine and six when their dad was labelled a fraudster.
“I remember early on sitting them down and the analogy I gave my six-year-old was that Daddy had sold someone a plant. They hadn’t watered it, it had died, and they were trying to blame Daddy for this,” he told The Times.
“There was a long period when they thought I would somehow fix this, but the nearer we got to the date, the more they understood that this was a battle.”
In 2015, the UK’s Serious Fraud Office dropped the case due to a lack of evidence but across the pond, a storm was brewing that would lead to the largest fraud trial in Silicon Valley history.
Facing 17 charges of conspiracy, securities fraud and wire fraud, later reduced to 15, Mike was extradited to the US in March last year after being arrested outside his sprawling Chelsea home.
Who are the six still missing from the Bayesian yacht tragedy?
By Ellie Doughty, Foreign News Reporter
THE BAYESIAN superyacht was hosting a lavish party for 12 guests, with 10 crew also onboard.
After 15 people were rescued from the water on Monday, six people remain missing and one has been found dead.
Italian authorities said the man recovered near the yacht wreckage was the chef working onboard.
Four of the missing are British and two are American.
Mike Lynch, 59, and his daughter Hannah, 18, are among the four Brits lost at sea.
International chairman of bank giant Morgan Stanley, Brit Jonathan Bloomer, 70, is also missing along with his wife Judy.
As is top New York lawyer Chris Morvillo, a solicitor at major firm Clifford Chance who worked for Mike Lynch, and his wife Neda
“It has to be wrong that a US prosecutor has more power over a British citizen living in England than the UK police do,” he said at the time.
Extradited in chains
At London Heathrow, Mike was put in shackles by US Marshals which weren’t taken off until he reached the home he would spent the next 13 months inside under 24-hour surveillance, wearing an ankle tag and having surrendered his passport and $100million bond.
Mike said: “It’s ridiculous. You’re in chains, even though, like, what are you going to do? As you can see, I’m not exactly an Olympic boxing champion.”
He faced 25 years in prison if found guilty and believed he was likely to die if incarcerated due to suffering “various medical things that would have made it very difficult to survive” including a serious lung condition.
“I’d had to say goodbye to everything and everyone, because I didn’t know if I’d ever be coming back,” Mike reflected after his release.
“If this had gone the wrong way, it would have been the end of life as I have known it in any sense.”
The cases took a toll on his family too. Mike’s brother while he was under house arrest, meaning he was unable to attend the funeral, and his mum also died before he was cleared.
0.5% chance of victory
Mike remained laser focussed on winning his case choosing to “never watch anything with prisons in it” in the face of damning chances of him being exonerated.
It’s estimated just 0.5 per cent of all federal criminal cases in the US end in the defendant being cleared – despite this Mike would go on to win.
A few things worked in his favour including the trial being so ‘boring’ and detail-heavy – filled with emails, reports and jargon-laden spreadsheets – that jurors were left glassy-eyed and one was dismissed due to falling asleep multiple times.
Another was Mike’s former finance director Sushovan Hussain having already been found guilty for the same alleged crime, which meant his prosecutors knew what would be used in the case against him.
Prosecutors were also said to have failed to go “right for the jugular” when Mike was called as a final witness on the stand and instead asked “no probing questions”, instead reviewing the “chronology of documents”.
It’s ridiculous. You’re in chains, even though, like, what are you going to do? As you can see, I’m not exactly an Olympic boxing champion.
Mike Lynch
When Mike was found not guilty, he said the moment as “indescribable” and later in a text said it was “so wonderful” to be home with his wife and daughters, 21 and 18.
Mike said: “If this had gone the wrong way, it would have been the end of my life as I have known it in any sense.
“It’s bizarre, but now you have a second life – the question is, what do you want to do with it?”
‘St Peter’s questions’
Mike couldn’t wait to return to the UK – where he has a luxurious home in Chelsea, London, and sprawling 16th Century home Loudham Hall, in Pettistree, Suffolk, that cost £6million.
At the latter, he and wife Angela – who has kept out of the public spotlight – threw a garden party to celebrate that included prominent business people and politicians including former deputy prime minister Therese Coffey and Tory peer Lord Deben.
The acquittal heralded a change in how he interpreted his life – and through tears, he told The Times he had “a different mindset” due to the “very strange situation” he had been through.
He said: “I stood on Piccadilly Circus the other day, which has the most enormous permanent traffic jam, and I’m just thinking, ‘This is the most beautiful thing I have ever seen.’”
Despite being cleared, Mike was due to write a sizeable cheque after being found to have committed fraud during a 2022 battle in London’s High Court.
HP had demanded $5billion. A judge had yet to decide how much he should pay but did note it would not be the full requested amount.
After being acquitted in the US, Mike spoke about spending more precious time with his family.
His older daughter, now 21, was studying physics at university and Hannah, 18, was due to go to Oxford this autumn.
Exhausted by his ordeal he wanted to take the family on a much-needed holiday before he worked the next big plans in his life – which would lead to the tragic yacht disaster.
The vessel is named after Bayesian inference – a statistical theory developed by 18th Century philosopher and mathematician Thomas Bayes – which helped make Mike’s company Autonomy such a success.
Prior to the holiday, he said: “You don’t realise how tired you are until you stop and have a chance to be tired. It is that sort of exhaustion in your bones.”
Mike was reportedly planning to form a UK version of the Innocence Project – a US charity that works to free wrongly convicted people after thinking about his legacy – due to admitting it was only the millions he spent that guaranteed his freedom.
It followed him thinking deeply about what he had done during his lifetime and asking, what he described as “Saint Peter’s questions”.
In what’s now a hauntingly sad response, Mike explained it to mean: “So you arrive at the Pearly Gates before being dispatched to the elevator down to the basement, and you say to Saint Peter, ‘You know, just before I go, what was that all about? What was that?’”