Media File: 1983
Sinclair in the News

Financial Times
January 7, 1983

Computer man Sinclair starts to court the investors

By Jason Crisp

City of London institutions heard this week from Clive Sinclair, head of Sinclair Research, the fast-growing British computer company, about plans to launch a miniature television set the size of a paperback book. If successful, the tiny television could prove as big a money spinner for Sinclair as computers have been in the company's short but remarkable history. Jason Crisp reports.

MR CLIVE SINCLAIR - Britain's remarkable, maverick entrepreneur and prolific innovator - this week began his courtship of the City of London institutions.

He spent most of Wednesday afternoon at the London offices of N. M. Rothschild, the merchant bankers, presenting the merits of his high-flying computer company, Sinclair Research, to a select group of institutions.

The purpose of the presentation was part of the process of placing 10 per cent of the company - which is 95 per cent owned by Mr Sinclair himself - with investors.

The City of London and Mr Sinclair are not the most natural of bedfellows. The City is cautious about Mr Sinclair's chequered business record while he remains deeply suspicious of the British establishment. But Sinclair Research is one of the most remarkable business success stories of recent years. Founded in July 1979, it launched its first products in February 1980 and expects a turnover it the present financial year of about £50m.

The first product was a personal computer which sold for under £100, substantially below anything offered by the competitors. In 18 months, Sinclair sold 100,000 computers in a market which did not exist before. In March, 1981, Sinclair launched a new computer which was more sophisticated and powerful, better designed and cost just £70.

Since then, the price of that computer, the ZX81, has been cut to £50. The company has also launched a more powerful model, the Spectrum, costing £125 or £175, depending on the version. In three years Sinclair Research has sold more than 900,000 computers in 30 countries.

In addition to the computers themselves, Sinclair Research has also been selling a tiny printer, add-on memory and computer programmes. In the year to March 1982, the company made just under £10m profit in sales of £27m.

Sinclair is expected shortly to launch a mass storage memory for his computers - a micro floppy disc drive costing about £50, while potential investors were told this week that the company planned to launch the much-delayed paperback-book sized black and white television in the second quarter of this year.

The "Microvision," which uses a revolutionary almost flat picture tube, has been a long-held dream of Mr Sinclair. Its launch was first scheduled for early last year and then delayed for the recent Christmas market. Sinclair says it has had production difficulties.

If it is successful, the tiny television could prove to be as big a money spinner as the computers. Production plans for the first full year are to make 1m units - and they will sell for little more than £50, says the company.

The doubts which always surround Mr Sinclair stem from past failures, most notably Sinclair Radionics which had to be bailed out by the National Enterprise Board. Although Sinclair Radionics pioneered the world's first pocket calculator it was soon overrun by massive Japanese competition. An infamous digital watch was a disaster because of faulty components.

A result of past failures, Mr Sinclair now tries to tackle markets on a world scale and also sub-contracts as much of the operation as possible to concentrate his strength on innovation.

This £50m-a-year company employs just over 50 people of which most are based in Cambridge. They are employed in research and development, administration and marketing. Production, distribution and advertising are sub-contracted.

Most Sinclair products are made by Timex in Dundee. Timex also has the North American marketing rights for the computer products for which it pays Sinclair Research a royalty.

One of Clive Sinclair's pet projects - a revolutionary electric town car - has been excluded from Sinclair Research of fear of frightening away potential investors. Development of the car will be funded by Sinclair himself, greatly assisted by the £20m or so expected to be raised by the placement of the 10 per cent of Sinclair Research.

The prototype electric car is not expected to be revealed until next year, and will need huge investment for the production stage. By then, Sinclair Research, strictly a consumer electronics company, is likely to be a publicly quoted company.