After contracting typhoid fever Matthews was invalided out of the army and returned to England, took some cheap lodgings in Bexhill-on-Sea, in East Sussex, and began to look for what opportunities there were for an electrical engineer. He managed to get a job as a consulting engineer for a wealthy aristocrat, the 8th Earl De La Warr. Matthews had previously met the Earl whilst he was on active service in South Africa when the Earl was employed as a war correspondent for The Globe magazine. With a meeting of minds and the deep pockets of the Earl, Matthews set up a small laboratory and radio station in the Kursaal, an ornate entertainment pavilion built under the patronage of the Earl. He began trying out the ideas he had had during his wartime service. Then on September 3rd 1907 his first success came when he transmitted speech by radio waves over a distance of half a mile.
Flushed with success and convinced he was on the right lines, Matthews went on to build the 'Aerophone' or Radiophone, the world's first mobile phone, which he patented on the 6th of November 1909. It comprised a small polished mahogany box containing everything required for the transmission of conversation with both transmitter and receiver being completely portable: 'Consisting of a small and portable set of electrical apparatus, with a receiver similar to that of a telephone... messages could be heard distinctly and accurately at a distance of over seven miles.'  Matthews, along with several investors, set up 'The Grindell Matthews Wireless Telephone Company' and was planning to sell the Aerophone for £18 18s. He demonstrated his Aerophone to King George V and Lloyd George.
But this wasn't the only patent Matthews filed in 1909. He had also invented an automatic pilot or an 'Improved Automatic Righting Device for a Flying Machine'. This enabled a flying machine to 'automatically right itself', a truly remarkable device for 1909.
The Admiralty invited Matthews to give a demonstration of his Aerophone which he did on September 29th 1911 at the Army Wireless Experiment Establishment at Aldershot. However during the demonstration Matthews discovered a government official covertly making detailed notes and drawings. An incensed Matthews ordered his assistants to stop the demonstration and immediately packed everything away. This was to be the beginning of a relationship overshadowed with mistrust and suspicion that was to last for the rest of his career.
Matthews had a greater vision for wireless communication - the Aerophone was just the beginning - and he asked the shareholders of The Grindell Matthews Wireless Telephone Company for more investment with which he set up two radio broadcasting stations; one in Northampton and one at Letchworth in Hertfordshire. Matthews' quest to extend the range over which he could transmit speech was obsessive. Between 1909 and 1913 he filed no less than seven patents relating to improvement in wireless telephony.  Matthews demonstrated the versatility of wireless telephony by communicating with a pilot in flight. On Saturday, September 23rd 1911 a world first was made at Ely Racecourse in Cardiff when Matthews established radio contact with a moving aircraft. C.B. Hucks, an aeronautical pilot, flying in a Blackburn Mercury Monoplane, was able to hear Matthews speak to him whilst flying at 700 ft and at the dizzying speed of 60 miles per hour!
Just before the outbreak of the First World War The Grindell Matthews Wireless Telephone Company went bankrupt. The Aerophone didn't quite make it to market: Matthews was a perfectionist, forever trying to refine it and the company hadn't made a single penny in profit and consequently the Northampton and Letchworth experimental radio stations had to be closed.
In 1915 Matthews started a collaboration with Dr Edmund Fournier D'Albe who was an expert in the uses and application of selenium. Together they worked on a control system which was used to remotely control a small boat called Dawn by shining a searchlight onto it. On a cold winter's day in December 1915 Matthews and his team demonstrated Dawn to senior members of the British Government on Penn Pond in Richmond Park, London.
The government were so impressed with what Dawn could do that they wrote him a cheque for £25,000. Matthews and D'Albe would later, in 1923, collaborate on a rival television system to that of the legendary inventor John Logie Baird. D'Albe patented his system in January 1924, just days before Baird was to give the world's first demonstration of television.
With a cheque for £25,000 in the bank Matthews was able to pay off his creditors, never far behind him, and continue his work. He went on to apply his inventive mind on a submarine detection apparatus which he trialled at Portsmouth, Bristol, and Barry in Wales. Matthews also did some testing of his apparatus in France. During trials Matthews was able to detect submarines under water at a distance of nine miles. Despite the results Matthews and his team achieved the government weren't interested and he shelved the project.
In 1921 Matthews set up a laboratory at Harewood Place in London and was working on optical sound tracks or recording sound onto film. Before the advent of 'talkies', when a film was made, the images and the sound were recorded separately. When played back, the sound would never run in perfect synchronisation with the pictures. Matthews designed and built a camera that could record an optical sound track alongside the photographed image so that they would never run out of synchronisation.
Matthews demonstrated the practicalities of his camera by setting up a small recording studio on the roof of his Harewood laboratory. It was here that one of the world's first talking pictures was recorded. On September 16th 1921 he recorded a 'talkie' of Sir Ernest Shackleton making a farewell speech before embarking on his final, and ultimately fatal, expedition to the Antarctic.
Matthews foresaw the growing popularity of cinemas and was confident that the large film studios would be interested. But despite his remarkable camera Matthews couldn't interest the film industry who weren't convinced that talkies had a commercial future. Film producers simply told him that they weren't prepared to scrap the machinery fitted in cinemas, or kill the box-office value of silent movie stars. Talkies would later prove to be tremendously popular with the cinema-going public, but it was too late for Matthews who missed out on the chance to make a fortune because all of his patents had by then lapsed.