Why Raspberry Pi is more than just a ‘kit computer’ company

Raspberry Pi’s founder playfully refers to Apple as “the other fruit company”. While its £731 million market cap might be a world away from US giant’s $3.4 trillion pie, it is continuing to bake its importance in the centre of UK tech world.
With its quirky name and unusual structure, some have fallen into the trap of viewing Raspberry Pi as a fun company that makes “toy” computers aimed at kids. This week’s results from the FTSE 250 business reinforce that it is anything but.
It has been three months since pink and red confetti exploded into the London Stock Exchange, marking the launch of Raspberry Pi onto the financial markets. The microcomputer maker’s share price is now 371¼p, up 33 per cent in its first few months as a PLC. It priced its shares at 280p at launch.
With the hiccups along its supply chain finally easing, the business announced sales were up over 60 per cent in the first half of the year to $144 million.
There remain lumps and bumps of backlog and inventory which will go on until the end of the year, but it feels like the business can now look beyond this.
The perception of Raspberry Pi as a “toy” business, stems from its roots in the Raspberry Pi Foundation, an educational charity, created as a way to get kids interested in computing.
Eben Upton came up with the idea and created a cheap, credit-card sized computer when as director of studies in Cambridge, he was struggling to get anyone to study computer science.
It worked so well, a business was formed. Today, beyond the products for “kitchen table tinkerers” described on its website, the industrial arm is the real powerhouse of Raspberry Pi Holdings, making up over 70 per cent of its sales according to its IPO docs.
Built by Sony, in Pencoed, Wales, the products are used by companies like Heathrow Airport to power flight information display systems.
This is only going to increase now that it is a PLC and it grows its customer base. It is “easier to have senior level conversations” the entrepreneur says, with announcements on these to follow in due course.
It is also expanding in a range of other, potentially lucrative, directions.
The company sold 2.1 million semiconductors in the first half of the year from 1.6 million units the year before. Granted, this is currently “immaterial to revenue”, but plants a flag about its long term strategy, selling individual components rather than its finished Pis.
This year it built a software product, a $6 a year cloud platform called Connect, which has seen 50,000 user signups so far. Over a hundred businesses want to explore an enterprise version.
Upton does not see any reason “why you couldn’t turn that into a generic offering over time” because, like selling chips from Raspberry Pis to those building things without Raspberry Pis, there is not a “cultural resistance” to this kind of decoupling.
Unlike at “the other fruit company”.
Then there is AI, where it has developed specialist hardware to run the tech, in collaboration with Hailo.
Products aside, there is a lot of room for geographical growth. At present, just over half of its customers are based in the UK with about 18 per cent in the US and 16 per cent in Europe. With such international backers as Arm and Sony, this could easily shift and expand.
Not everyone is enthusiastic. JPMorgan and Premier Miton have short positions open in the company. Supply chain issues could return pushing up costs and causing delays. It imports silicon from Taiwan, a clear geopolitical vulnerability.
Speaking on the morning of the company’s first post IPO results, always a gruelling day for chief executives, Upton was in buoyant mood, shrugging off these issues saying the company was “still fun”.
In a nice circularity, he added that some of its graduate engineers starting today had their first encounters with computing on the little devices.
It might be harder to quantify than hardware sales, but this playful side of the business remains invaluable to the UK’s tech ecosystem and beyond.