Cliff Stanford, high-living founder of Demon Internet who hit the jackpot bringing affordable access to the web to all – obituary





Clifford Stanford, who has died from cancer aged 67, founded Demon Internet, a company which sparked a revolution by becoming the first to provide genuinely affordable access to the internet in the UK; later he was instrumental in exposing the hidden assets of Dame Shirley Porter, the Tesco heiress and disgraced former leader of Westminster Council.

When the internet began, it was mainly used for communications between academic institutions. Commercial internet service providers (ISPs) emerged in 1989, but access remained extremely expensive.

In the early 1990s Stanford, who ran a small business software company, heard that Pipex, the UK’s first commercial ISP, had started offering leased-line internet access for £20,000 a year, so he got out his calculator and began to do the maths .

With a Net feed leased from Pipex, he reckoned that if he could get 200 people to pay £10 a month (an early example of crowd-funding) for an individual dial-up service it would be viable, “and if I could get 400 people I would make a £20,000 profit.”

Demon Internet, offering “just a tenner a month” access to the internet, was born in May 1992 in a boiler room behind the old Odeon cinema in Hendon, with 200 subscribers, eight modems, a few phonelines and the Pipex Net feed.

Its initial aim was to gain 400 subscribers in six months and 1,000 in two years. “In the first year we got 1,400 customers,” Stanford recalled. “Each month we grew by 25 per cent, and we were not even advertising.”

With the advent of the World Wide Web in 1993, Demon went on to hit the jackpot. By 1997 the company had 250,000 subscribers, all with an email address ending “demon.co.uk”, and the same year it was sold to Scottish Telecom for £66 million, of which Stanford banked £33 million.

Predicting that his business empire would be “bigger than Branson’s”, and declaring: “There’s no such thing as enough money”, a few days after the sale Stanford set up another venture, Redbus Investments, with John Porter, the son of Dame Shirley . In 1999 Stanford appeared in The Sunday Times Rich List, in 731st place.

To begin with things went well enough, with Redbus riding the technology and investment boom at the end of the 1990s. Its investments included a landmine clearing outfit, an early online film service (later sold to Lionsgate), a manufacturer of light-bending windows, a dentists’ training firm and a girl band called Girls@play featuring Alan Sugar’s niece as its lead singer ( “If they do what the Spice Girls did, we could make millions” – they didn’t).

It also featured Redbus Interhouse, a company specializing in building and running internet “hotels” – data rooms that take care of firms’ online activities. In 2000 Redbus Interhouse came to the stock market, raising £120 million, money it spent establishing co-location centers around Europe.

“I always wanted to be wealthy,” Stanford told The Guardian in 2001. “Money doesn’t buy happiness but lack of it can lead to misery. Now I really enjoy my life, I do whatever I like and no one tells me otherwise.”

After selling Demon, Stanford had moved to Brussels to avoid capital gains tax and splashed out on a £150,000 Rolls-Royce Silver Spur (“my favorite present to myself”), a private jet, and a house on the Costa del Sol.

But then troubles began. In December 2000, a spread in the News of the World gave an account of champagne-fuelled overnight romps at Claridge’s with two exotic dancers. “Cliff doesn’t have any inhibitions,” one young woman was quoted as saying. “Let me tell you – his bank balance isn’t the only impressive thing about him. That man certainly has breathtaking assets.”

Stanford was inclined to shrug off the article: “The stripper was a friend of mine and she sold a story, so good luck to her. But the detail was so wrong it was laughable. Even my mother didn’t believe it.” Claridge’s, however, banned him from the hotel.

Worse was to come. Redbus Interhouse failed to generate sufficient sales to support its expansion, and as the dot.com bubble burst, shares began to slide.

The result was a spat between Stanford and Porter over company strategy – a drama played out in flying writs, boardroom rows and angry shareholder meetings over more than a year.

It culminated in a stormy five-hour extraordinary general meeting in July 2003 (by which time Stanford had resigned as deputy chairman, though he still owned 30 per cent of the business), when about 61 million votes were cast in favor of Stanford’s demand for the removal of all of Redbus’s directors, including Porter, while about 67 million were cast in favor of keeping the existing team.

In September that year Stanford sold his Redbus stake, once worth £150 million, for just £3 million.

The following month, allegations surfaced that Stanford had been involved in the interception of emails between Porter and his mother, Dame Shirley, and in 2004 Stanford was charged with committing offenses under the Computer Misuse Act and the Regulation of Investigatory Powers Act. Police claimed that Porter’s emails had been automatically forwarded to a Hotmail email address.




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