In 1987 Caudwell and his brother Brian both registered Midland Mobile Phones as a mobile phone wholesaler, initially taking 26 Motorola mobiles at £1,350 each. It took 8 months to sell these 26 phones to local plumbers, taxi drivers and television repairmen at a price of £2,000 each. The company made a loss every month for the first two years of operations. The business became the Caudwell Group part of which was an independent mobile phone network service provider called Singlepoint and a high street mobile phone retail operation called Phones4U. The group also owned The Discovery Store from 2001. In 2003 he sold Singlepoint to Vodafone for £405m (then $648m). Caudwell completed the sale of the wider business on 26 September 2006, when it was revealed that the Caudwell Group had been sold for a £1.46 billion to private equity firms Providence Equity Partners and Doughty Hanson.

In 1999, Caudwell was appointed as the President of the North Staffordshire branch of the NSPCC, and became the regional representative for the Full Stop campaign. Of the appointment, he says: “I was initially approached by the NSPCC to sponsor a cricket match. As is my way I got stuck in, took the whole thing over and was determined to raise as much money as I could.”

Caudwell founded the charity Caudwell Children in 2000. It became a national charity in 2006, and as of 2016 Caudwell is the chairman of the board of trustees. Of the charity, he said: “I wanted to make sure that every penny that was raised would be put to the best use and spent on the children that needed it. My family puts about £2 million a year towards Caudwell Children. In addition I put in a lot of my time and I do a lot of networking. [But] the truth is my fortune isn’t enough to help all the children that need help.” The charity has proved controversial because it promotes unproven and dubious health practices and has aligned itself with antivaccinationists. The National Autistic Society asked Caudwell’s charity to remove claims from its website that it had the society’s support.

As of July 2013, Caudwell Children has raised £27 million since its inception in 2000.

Caudwell was married to Kate McFarlane for 25 years, ending in 2001, and they had three children. He then had a relationship with violinist Jane Burgess, with whom he had a daughter. He was then in a long-term relationship with Claire Johnson for 15 years, with whom he has a son. They separated in 2014.

In April 2010, Caudwell donated £2,000 to Conservative MP Bill Cash’s general election fund.

In October 2011, he made a “significant” six-figure donation to Middleport Pottery (one of the last working Victorian pot banks in Britain) in Stoke-on-Trent, through The Prince’s Regeneration Trust. In October 2012, Caudwell was one of three principal private donors for the London’s Bomber Command Memorial Appeal.

He still donates to the NSPCC, and undertakes regular 1,000-mile charity bike rides to raise funds for many children’s charities. On one fundraising bike ride from Land’s End to John o’ Groats in 2012, he raised £58,021 for Caudwell Children.

Caudwell has been awarded accolades for his philanthropic efforts. On 8 December 2012 at The Noble Gift Gala, he was presented with The Noble Gift Philanthropreneur Award by Hollywood actress Eva Longoria for his dedication to charity work.

In February 2013, he became one of the first Britons to sign up for Bill Gates and Warren Buffetts’ Giving Pledge, which calls on billionaires to commit at least half their wealth to charity during their lifetime.

In 2015, Caudwell claimed that 11 family members including himself, his ex-wife Kate McFarlane, their two daughters Rebekah and Rhiannon, and his son Rufus had been diagnosed with chronic Lyme disease. Caudwell pledged to donate more than £1million of his own money in order to help fund Lyme Disease research, on the condition that the NHS would be able to match his investment.

In 2019, Caudwell was reported to have donated £500,000 to the Conservative Party ahead of the 2019 United Kingdom general election. He also gave interviews stating that he and many other wealthy individuals would leave the UK if the Labour Party gained power, although he faced criticism for donating such a large sum to a political party, rather than a worthy needy cause.