Raspberry Pi on the road to success: British tech pioneer on a growth trajectory

Raspberry Pi, a unique technology company, originated as a foundation developing affordable microcomputers for schools. After expanding into the industrial technology sector, it went public on the London Stock Exchange in June. Last week, the company released its financial results for the first time, causing its stock to rise by 9 percent and giving it a market capitalization of approximately £720 million. The company is based in Cambridge, the city where the pioneering computer manufacturer Acorn Computers was founded in 1978. Acorn spun off its chip design division to form Arm before failing in the 1990s. Raspberry Pi emerged from the computer science department of the University of Cambridge and has significantly surpassed its origins. The company's single-board devices, largely assembled by Sony in a factory in Wales, are notably affordable: the latest Raspberry Pi 5 base model costs less than £50, and a microprocessor with its own chip design about £5. Initially developed for schools and home projects, they are now used in various machines, from electric vehicle charging stations to flight information displays. Raspberry Pi has garnered a global following with its charming approach, including 3.2 million subscribers on Reddit, compared to Nvidia's 1.9 million. This grassroots approach appeals to a traditional technology culture of hackers and makers, as opposed to companies like Apple and Microsoft. As it enters the mainstream, it will be more challenging to maintain this spirit. The company was born out of the frustration of Cambridge academics in the early 2000s, who noticed a decline in applications for computer science courses. One of them, Eben Upton, now co-founder and CEO of Raspberry Pi, set out to change this. They wondered, "Where have all the kids gone?" and the idea for Raspberry Pi was born to fill the gap. Upton had acquired his technology knowledge at school on an Acorn BBC Micro computer (he had also bought one himself). After Acorn's demise, the BBC Micro was no longer available, so they started the Raspberry Pi Foundation to promote computer literacy. Besides supporting education, they established a company that launched its first device in 2012. On the first day alone, the company received 100,000 orders and sold 1 million devices in its first year. The boards were so affordable and versatile that enthusiasts adopted them en masse. Arm invested in Raspberry Pi, and Paul Williamson, a senior Arm manager, recalls that his 13-year-old son at the time used it to install a camera in the family's birdhouse. Raspberry Pi quickly expanded beyond education and hobbyists. Hardware engineers began testing the devices, and they later found their way into industrial machines. About 70 percent of sales now come from such applications and 30 percent from education and hobby projects. "It is becoming a globally significant company," says Williamson. Despite its cute image, Raspberry Pi is a highly sophisticated company. Upton ironically compares it to "the other computer company named after a fruit" regarding its level of vertical integration: It designs much of its own software and hardware, including chips manufactured by TSMC in Taiwan. Though only a fraction of Apple's size, it has carved out a niche. How will it evolve? One risk is that it might burn out in the highly competitive industry, like Acorn before it: there are already fruit-themed rivals like Banana Pi from Shenzhen, China. Entry barriers are low since many rivals can design chips and outsource assembly. Raspberry Pi must continue refining its devices while staying affordable. The second danger is that its charm might fade with increasing commercialization. The foundation raised £136 million by selling shares in June and is now a long-term investor with a stake of less than 50 percent. The company has become richer than anyone expected, but the relationship has grown more distant. Nevertheless, this is a moment to acknowledge an unusual British success story. Raspberry Pi has defied the trend of British tech firms listing in the US, including Arm. It has also revived Cambridge's history of hardware manufacturing, dating back to the Edsac program computer built in 1949 by Maurice Wilkes, then head of the computer lab. A measure of its impact is joining the FTSE 250 index. Another is that the computer science undergraduate course at the University of Cambridge now attracts more than 10 applications per place. Two decades after its founders dreamt of a new machine, Raspberry Pi has achieved its goal.