Davies was born in Exmouth, Devon, England. After attending Westminster School, he studied music at Worcester College, Oxford from 1961 to 1964. Shortly after he traveled to Cologne, Germany to work for Karlheinz Stockhausen as his personal assistant. For two years, he assembled and documented material for Stockhausen's compositions and was a member of his live ensemble.

From 1968 to 1971 Davies played in a group called the Music Improvisation Company. The group's guitarist Derek Bailey later wrote that "the live electronics served to extend the music both forwards and backwards (...) Davies helped to loosen what had been, until his arrival, a perhaps too rarified approach". He was also a member of the group Gentle Fire, active from 1968 to 1975, which specialised in the realisation of indeterminate and mobile scores, as well as verbally formulated intuitive-music compositions (such as Stockhausen's Aus den sieben Tagen) and in the performance of its own Group Compositions.