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Raspberry Pi is a quirky enterprise. Started by a foundation to make cheap microcomputers for schools, it expanded into industrial technology before listing in London in June. When it announced its first public financial results last week, its shares rose 9 per cent, giving it a market value of about £720mn.
The company is based in Cambridge, the city where the pioneering Acorn Computers was founded in 1978. Acorn spun off its chip design division to form Arm before failing in the 1990s. Raspberry Pi was conceived in the university’s computer science department, but has transcended its origins.
Its single-board devices, mostly assembled in the UK by Sony at a factory in Wales, are remarkably cheap: its latest Raspberry Pi 5 basic model costs under £50 and a microprocessor with its own design of chip is about £5. Having started in schools and home projects, they are popping up in many machines, from electric vehicle chargers to flight information screens.
Raspberry Pi has always been charming: it now has a global following of enthusiasts, including 3.2mn subscribers to its Reddit forum, compared with Nvidia’s 1.9mn. Its grassroots approach appeals to a traditional tech culture of hackers and makers, rather than companies such as Apple and Microsoft. As it joins the mainstream, it will be harder to maintain this spirit.
It was born of frustration among Cambridge academics in the early 2000s that there were fewer applications for degrees in computer science than for other courses because it was not taught in schools. One of these was Eben Upton, now its co-founder and chief executive. “We asked, ‘Where have all the kids gone?’ . . . The idea behind Raspberry Pi was that an object was missing.”
Upton had learnt technology at school on a BBC Micro computer made by Acorn (he also bought his own). With Acorn’s demise, the BBC Micro was no longer on sale, so they set out to encourage computing skills through the Raspberry Pi Foundation. As well as supporting education, it started a company that launched the first device in 2012.
It discovered an unmet need, receiving 100,000 orders on the first day and selling 1mn devices in its first year. The boards were so cheap and versatile that enthusiasts adopted them en masse. Arm has invested in Raspberry Pi and Paul Williamson, a senior Arm executive, recalls that his then 13-year-old son used one to install a camera in the family’s bird feeding box.
Raspberry Pi soon expanded beyond education and enthusiasts. Hardware engineers started to test devices using its boards, and they later found their way into industrial machines themselves. About 70 per cent of its sales now stem from such uses and 30 per cent from education and hobbyists. “It is emerging as a globally significant company,” Williamson says.
Despite its cute image, Raspberry Pi is a sophisticated operation. Upton compares it wryly with “the other computer company named after a fruit” in its degree of vertical integration: it designs much of its own software and hardware, including chips made by TSMC in Taiwan. It is a fraction of Apple’s size, but has found a niche.
How will it now fare? One risk is that it burns out in a competitive industry, as Acorn did before: it already has fruit-themed rivals, such as Banana Pi of Shenzhen in China. The barriers to entry are low, given that many rivals can design chips and contract out assembly. Raspberry Pi has to keep on refining its devices while remaining cheap.
The second danger is that its charm fades as it becomes more commercial. The foundation gained £136mn by selling shares in the June offering, and is now an arm’s length investor with a stake of less than 50 per cent. The company has made it wealthier than anyone expected, but the relationship has become more distant.
Still, this is a moment to pause and appreciate an unusual British success. Raspberry Pi has defied the trend of UK-based technology companies that have listed in the US, including Arm. It has also revived Cambridge’s history of making hardware, reaching back to the Edsac stored program calculator built in 1949 by Maurice Wilkes, then head of its computer laboratory.
One way of measuring its impact is that it has joined the FTSE 250 index. Another is that Cambridge university’s undergraduate computer science degree now attracts more than 10 applications per place. Two decades after its tutors dreamt of a new machine, Raspberry Pi has worked.