Yes, I could have been Bill Gates

In 1978, Hermann Hauser co-founded Acorn Computers, which produced the BBC Micro Computer. He has since founded more than 25 IT-related companies in the UK. In 1997, he co-founded Amadeus Capital Partners, the venture capitalists, with funds totalling £285m

My biggest mistake was at Acorn Computers, when we failed to realise how far ahead of the competition we were with the BBC Micro Computer. We had made the best computer in the world but instead of using it to set a standard for the industry, we hogged the rights. The consequence was that the world became IBM- compatible when it could have been Acorn-compatible.

In about 1980 I was running Acorn Computers, which I co-founded, with Chris Currie. We had just produced the BBC Micro Computer. It was twice as good as the leading computer in the world, which was the Apple II. Ours had twice the graphics resolution and it was black and white and colour, whereas the Apple II was monochrome; ours also ran at twice the speed of the Apple. And the BBC Micro Computer had a network connection built in ­ and networking turned out to be very important later on. We had it before Apple did.

It's hard to think back that far because today we have the PC standard. But there was no PC standard. There were lots of different environments ­ Apple, Commodore, Atari, and the BBC Micro.

Our mistake ­ and it was a large one ­ was not realising we were so far in front. If we had recognised we had the world's best computer, and had we gone out to set a standard with it, maybe the world would be Acorn-compatible rather than Wintel-compatible [Windows and Intel]. We also had the best operating system, better than Microsoft's MS-Dos. When Bill Gates was trying to sell MS-Dos to me I could clearly show him that we couldn't take such a retrograde step because we had something that was a lot better.

We thought that these were our crown jewels. We wanted to sell computers rather than sell a standard. If we had allowed anybody to make a computer to our specification under licence, as Microsoft did with its operating system, then we could have grown into a much larger company than Acorn did. We could have set the world standard.

We didn't see it because nobody did at the time. I didn't realise until about 10 years later. For a long time, the strategy of hogging the specification allowed us to produce a computer against Intel and against Microsoft that had a much better price-performance. Our processor, the ARM, was always much faster than Intel's and because of our built-in operating system we always had snazzier features than Microsoft. Butit was very hard for a little Cambridge company like ours to win against Intel and Microsoft.

The main thing we learnt was that high-tech industry rules can change very quickly and, unless you interpret the trends very early on, you can suffer from the changes in the marketplace. The IBM PC standard was established, and everybody built computers to that standard.Acorn, which was non-standard, finally disappeared. In the end we spun out the ARM microprocessor from Acorn, and ARM has become the most successful technology company in Britain, with a $6bn (£4.2bn) market cap, and also the largest microprocessor company in the world. We overtook Intel last year in terms of numbers of microprocessors sold ­ not in terms of value, of course.

Acorn, the computer company, is no more because the value of the ARM shares when we spun it out completely dominated the Acorn share price, so we returned the ARM shares to the Acorn shareholders and spun out the remaining Acorn team into a company called Element 14, which we sold to Broadcom for $640m last year.

With hindsight, nobody at that time predicted standards would become so important. So I don't think we could be too cross with ourselves for not seeing it ­ I don't think anyone else would have seen it either.