The foundation of PACE

The founders of Apple, Steve Jobs and Steve Wozniak initially worked out of Jobs’ garage at his home in Los Altos, California. On April 1, 1976, they debuted the Apple I, a desktop computer that came as a single motherboard, pre-assembled, unlike other personal computers of that era. The Apple II, a superior model, was introduced in 1977.

Jobs and Wozniak had great difficulty in gaining initial investment finance because the market had no belief in the notion of domestic computers. Nevertheless, they became one of three companies who succeeded in producing personal computers and their Apple IIe range would become extensive, lasting for over 11 years.

As his television business was progressing, David decided to purchase an Apple computer from Ram Computers on North Parade, Bradford, to help manage the television enterprise, dealing with the cash flow and the rental income. The cost was around £400.

David was quite taken with his Apple computer and mentioned to Barry that he thought there might be a business selling Apple software through mail order via Windfall.

In discussing a name for this business, a friend of Barry suggested ‘PACE’. The shipping consortium for whom Barry worked also owned a company called Pacific America Container Express, known as PACE. Their logo was the word ‘PACE’ in a square arrow. David liked the suggestion, so a UK software company named PACE was born.

The company name was David Richard Hood, trading as PACE Software Supplies, and the logo was the same as that of the shipping company, but initially without the arrow.

David researched products and trade prices. At that time (June 1982), there were only a handful of businesses advertising third-party products and, based on P & P Computers’ trade prices versus what the competition were selling at, there was a reasonable margin to be made.

David contacted several local bank branches and the manager of the local Barclays branch, Gordon Ormondroyd, agreed to back the business. David then got in touch with John Snowden, Advertising Manager for Europress, publishers of Windfall magazine, who agreed that his team would create an advertisement.

The business model was to take the P & P trade catalogue, look at the sales prices that other companies advertising in Windfall were selling them for and undercut them.

The straightforward idea was to place advertisements in Windfall, offering as many Apple Products as possible, take in orders by phone and mail, collect from P & P computers the products that had been ordered each day, then package them and get them in the post the same day. There was little need for stock and the business was immediately cash-positive, with the only overheads being advertising and petrol to and from Rossendale.

PACE Software Supplier’s first advert appeared in 1982. This offered around 500 items and was an immediate success. David and his partner took the phone calls, while Barry dealt with the correspondence in the evenings, whilst still working for ACT where he remained until March 1983.

The two men were thinking about new ideas for the business where computers with the right software would be of value. They developed a proposal about how computers might help Barry’s company ACT. One suggestion was sending updates on ship arrivals and departures to selected shippers via modem. The second was a computerized salesmen’s reporting system. The proposal involved PACE supplying the whole system for this transport company.

A different company, named PACE Computer Services was created to develop this proposal. The logo was not the PACE funnel logo but a dot matrix-printed ‘PACE’. At the end of March 1982, David and Barry met Walter Marshall, Regional Sales Manager for ACT, and presented the proposition to him. David Marshall was in favour of pursuing the idea but his London-based manager, Roy Davis, was not interested.

For PACE Software Supplies, it was getting more difficult to service the orders as they increased. In addition, Apple were selling more and more of the Apple II computer range and people were asking questions which David was finding it increasingly difficult to answer.

At this point Robin Hudson, a student at Bradford University enquired whether there were any vacancies during the university holiday. David decided to take him on to assist with answering the questions. Robin then introduced some university friends, Adrian Barratt, and Kevin Gibson.

David was living close to the friends in Scholemoor, Bradford. But another key person in the developing company was about to arrive.

One afternoon in 1982, a telephone caller asked whether the company had some graphics software in stock and on being told that they did, wanted to call in to look at these, not being prepared to use mail order. David told the caller which bus would get him to his house and that, when he got off the bus, he would see a telephone box that David could see from his bedroom window and easily locate where David worked from.

The caller was Rob Fleming, who at the time was a Flight Lieutenant and Medical Officer in the Royal Air Force, based at Ely. He had bought an Apple IIe, seen the advert, and had come to browse the shelves, rather than buy via mail order. The reason was that, given his RAF service, Rob moved around a lot and mail order might have had to follow him around for a long time.

Rob’s parents lived nearby, and he had initially come to Bradford to see his brother, Ian, in Queensbury but, in the event when he arrived at David’s house, he became so absorbed in what David was doing that he did not make the meeting with his brother that evening.

Rob was and is a self-confessed computer ‘geek’ and after talking at length with David he agreed to come back the following day, and also spent most of the rest of the week visiting and talking to David about computers and software. During one of these visits, the phone rang.

The caller wanted to know about a product called Wordstar, which David did not have any knowledge about. He asked Rob whether he knew about this product and when said he did, David passed the phone to him. Rob became involved in the developing company from then onward.

Rob was detached by the RAF to serve in the Falklands between June and November 1982 but when able to return he continued to travel North to work with David, whilst still serving as an RAF Officer.

David, Barry, and Rob were not always able to get together, but they would often all meet on Friday evenings at Cocina Restaurant, which was on Oak Lane, Bradford at the time. The business was successful, and the first year’s accounts reflected that, with almost £300,000 turnover in the first year, ending 30th June1983, with a net profit of £30,000.

The business expanded further, selling peripheral memory expansion cards. Initially, PACE bought these from London-based Pynwon Computers, who acted as agents for the main manufacturer, Zoffary, in Australia. However, at a certain point, Pynwon’s owner, Dr Boshell, no longer wished to distribute them and put PACE in touch with the manufacturer with a view to taking up distribution in UK and Europe.

Later Gynesh made contact from New York. They represented a number of US-based Apple software houses and asked PACE to take on their products as distributors. These products, included a four in one package – Word Processing, Accounting, Spreadsheet and Database – called ‘The Incredible Jack’; another was a relational database called Savvy and a further product, from Quark, was a word processing package.

Rob took some leave from the RAF to travel to New York with Barry, to assess what Gynesh had and whether it would be saleable in the UK and Europe, and worth taking on. As Rob was generally satisfied, Barry returned to New York to complete the deal, meaning that PACE were launched in the distribution business, with software packages that would enhance the company’s reputation as well as making money.

Unfortunately, no one had really tested these programs, particularly ‘The Incredible Jack’. It was reviewed positively in Windfall in March 1984 but next month, Windfall had to print a letter from the reviewer, pointing out that they had missed out of the review reference to the bugs he had found, which were numerous.

The component parts did not match up to more sophisticated (though more expensive) products available at the time. In any case, at this time, there little market for individual users, while businesses wanted established, market-leading products.

Savvy, on the other hand, though expensive and complicated for its day, was ahead of its time, being a relational database that recognised regular words, phrases etc., perhaps a forerunner of current Internet search engines.

Similarly, Quark was a powerful program and Quark are still a major player in digital technology today. Regardless of their individual success, these products gave PACE kudos and market awareness.

The retail business continued to prosper, with regular UK customers including universities, colleges, and government departments, such as the Atomic Weapons Research Establishment. PACE were also approached by a school in Amersham, who wanted them to sell communications software on their behalf.

One customer, Steve Lister, ran an advertising agency called Centrepoint and PACE employed his firm to create and develop advertisements for their products. Part of his initial remit was to develop full page, full colour ads for ‘Quark’, ‘The Incredible Jack’ and ‘Savvy’. In February 1984, PACE had 5 full-colour, full-page ads in Windfall, a clear signal to others that the company was becoming an important player in the digital ‘revolution’ of the mid to late 1980s.

At the same time, PACE started the process of becoming an Apple authorised dealer but found it hard work with the UK Apple team and never achieved full ‘Dealer’ status – achieving only ‘Re-seller’ status, which gave less margin than dealers.

The business was strengthened in June 1984 with the introduction of the Apple Macintosh. The Apple software business created a cash surplus and also raised awareness of PACE as a company.