Iain Pears - Stone's Fall

Most of the money had gone on machinery (part of which was recoverable if necessary), wages and materials for building his machine. His net position was in fact not as bad as it looked at first sight – if all the machinery had been sold at a reasonable price, he would be able to pay off most of his debts. But not all; he would be left with nothing at all for his efforts, except for his invention.

At this point, we entered the land of fantasy. Macintyre had essayed a guess about bringing his torpedo into production, but it was so devoid of any common-sense or knowledge that it was almost laughable. I swiftly enough made my own calculations. Purchase of a suitable premises would cost around £700, the necessary machine tools about £6,000, a workforce of about forty to begin with would mean running costs of about £7,000 a year, which would have to be borne out of initial investment as it was unlikely to produce any revenue for at least that time. Plus the cost of material, which would be about £30 for each machine. Say another £3,000 for the first year. A required initial investment, therefore of £16,700 before a single torpedo was carried onto its first ship, or the first request for payment sent out.

And Macintyre could not even manage a debt of £300 without sinking into near bankruptcy. What was worse, he had been obliged to offer security for the loan and had nothing to give. Instead, he had in effect handed over the patent. Not outright for cash, but merely for permission to borrow. Possibly the most foolish, thoughtless bargain any man has ever made. He no longer owned his own invention.

This part of the paperwork took me some time to get through, as it involved a considerable amount of legal jargon with which I was unfamiliar. Besides, I could not initially believe it, even when I had managed to make it out. But it was all too true. If the torpedo failed, Macintyre would suffer, as his debt would be called in. If it succeeded, he would not benefit, as the machine was not his.

I could only conclude that he did not care: that he was so unworldly that all he wanted was to perfect his invention, to show the world his ability. Macintyre did not want to manufacture his torpedo or make money out of it. Once it was finished, he would probably lose interest. Judging by how he had talked about ending war, it was quite possible he would be almost pleased not to have anything more to do with it. He wanted to show it could be done. That was all.

But why? Why so obsessed, why so careless? Here the limitations of accounts come into play. They can tell of the movements of men, of their money, but rarely give much of an insight into their motives – although Macintyre's fanaticism was written into every column of payments. He bought the best of everything: the highest quality steel; the most expensive German precision instruments. Materials he had imported from Sweden or England, when I was sure perfectly reasonable local substitutes were available at a fraction of the price he had paid. Bills were settled promptly when he had the money. He could not be bothered with the minor savings a delay of a week or a month might bring.

I sat on a chair on my balcony, looking down at the quiet of the canal below, dreaming peacefully. I was calculating fast, something I can do without the need for actual thought. Numbers, money, take shape in my head, and flow into new forms without the need to consider it at all actively. A woman was slowly propelling a barge down the canal, talking loudly to a little girl perched in the front of the boat. They were cheerful, even though it was the end of what had probably been for them a day of long labour. She was in no hurry; would give the oar a twitch, enough to make the boat spurt forward, then rest as it slid along and almost stopped, before twitching it again. By the time she had rounded the corner halfway down, into a tiny side canal I had not noticed before, I had the entire plan laid out in my head.

Macintyre needed to be rescued from himself. In effect, his foolishness had done me a great favour. I would have never even considered trying to wrest control of his invention from him, of forcing my assistance on him against his will or without his knowledge. But it was no longer his; he had sold it. And I had no qualms about taking on his bankers. They were opponents for whom one needed to feel little sympathy, if I could triumph over them.

Cardano would help, I felt sure. He would be able to back a private loan, so that I would retain absolute control and be able to pay off the debt when profits began to rise. I knew exactly the man who could help me set up the enterprise, could put me in touch with land agents to find a site. I would put in six – perhaps five – thousand of my own money, depending on the terms that Cardano could get. A limited company to protect myself. By carefully not paying any bills unless forced to do so, it would be a simple matter to make the suppliers in effect pay for the loan itself. They would get their money eventually, or we would all sink with the torpedo.

I found it all very relaxing, although I knew I would have to revisit my figures the next day, to see whether they were still realistic, or whether I had constructed too optimistic an outlook – underestimated costs, overestimated possible revenues. And I would wander down to the foreign library near San Marco, to see what, if any, information could be had on the world's navies.

I emerged from the library the next day feeling even more cheerful. The main navies of the world were the Royal Navy (everyone knew that) with the French next. After these two came Austria, Italy, the United States, Russia. After them a few South American countries had ideas and ambition, as did Japan. All in all, the world could boast, if that is the right word, some 700 capital ships, 1,400 medium-sized vessels which could be used for fighting, and another 4,000 used for coastal protection and so on. Say fifteen torpedoes for the first category, five for the second, one for the third. A possible world market of more than 20,000 torpedoes, and I reckoned I could charge £300 each. Possible revenues of more than six million pounds. Assume only half of the potential was turned into orders over a period of ten years, and replacement orders of 1/20th part of the total per year. That would suggest recurrent orders of about 1,000 a year, and revenue when properly under way of more than £300,000. Possible profits per year of about £100,000, for an initial investment of £5,000. Assuming the business would be valued at fifteen years' purchase, then that would create an enterprise of about one and a half million pounds.

Navies would order, if it worked. But would it? Macintyre was confident, and I was sure his acumen as an engineer was greater than his skill as a businessman, but even so obsession – and he was surely a man obsessed – leads to cloudy judgement.

Then there was the issue of wresting control from his creditors who, I was sure, had a better notion of his machine's financial potential than he did. They would not give it up for a paltry sum, and I did not wish to pay high. The whole point of the game is to get a bargain. Anyone can pay a full price.

How was this to be done? First, know your opponent and here, much to my surprise, my landlady proved to be a fount of useful information. Ambrosian, the head of the bank that had made the loan, was, she told me, highly respected as a man who had stayed in Venice during the Austrian occupation, but who had refused to have many dealings with Vienna. He had done most of his business with Venetians, and forged contacts with banking families in Italy, France – anywhere but Austria. Like most patriotic citizens, he had refused all invitations to official functions, refused to go to the theatre or opera, refused to sit in a café where an Austrian was sitting and (so it was said) subsidised forbidden groups of nationalists to annoy the foreign oppressors. He was something of a hero; whether he was any good as a banker was another matter entirely. Such information as I could gather from newspapers suggested a well-bottomed, but somewhat unimaginative, operation, which was good. Such people do not like risks. But newspapers are often wrong.