Entrepreneur
Bill Gates founded the world's largest software business, Microsoft, with Paul
Allen, and subsequently became one of the richest men in the world.
“Success is a
lousy teacher. It seduces smart people into thinking they can't lose.”
—Bill Gates
Bill Gates - Mini Biography (TV-14;
3:42) Bill Gates and his partner Paul Allen built the world's largest
software business, Microsoft. He became one of the richest men in the world and
a major philanthropist through the Bill & Melinda Gates Foundation.
Born in Seattle, Washington, in 1955, famed entrepreneur
Bill Gates began to show an interest in computer programming at age 13. Through
technological innovation, keen business strategy and aggressive business
tactics, he and partner Paul Allen built the world's largest software business,
Microsoft. In the process, Gates became one of the richest men in the world. In
February 2014, Gates announced that he was stepping down as Microsoft's
chairman.
Bill Gates was born William Henry Gates III on October 28,
1955, in Seattle, Washington. Gates began to show an interest in computer
programming at the age of 13 at the Lakeside School. He pursued his passion
through college. Striking out on his own with his friend and business partner
Paul Allen, Gates found himself at the right place at the right time. Through
technological innovation, keen business strategy and aggressive business
tactics, he built the world's largest software business, Microsoft. In the
process, Gates became one of the richest men in the world.
Bill Gates grew up in an upper middle-class family with two
sisters: Kristianne, who is older, and Libby, who is younger. Their father,
William H. Gates Sr., was a promising, if somewhat shy, law student when he met
his future wife, Mary Maxwell. She was an athletic, outgoing student at the
University of Washington, actively involved in student affairs and leadership.
The Gates family atmosphere was warm and close, and all three children were encouraged
to be competitive and strive for excellence. Bill showed early signs of
competitiveness when he coordinated family athletic games at their summer house
on Puget Sound. He also relished in playing board games (Risk was his favorite)
and excelled at Monopoly.
Bill had a very close relationship with his mother, Mary,
who after a brief career as a teacher devoted her time to helping raise the
children and working on civic affairs and with charities. She also served on
several corporate boards, including those of the First Interstate Bank in
Seattle (founded by her grandfather), the United Way and International Business
Machines (IBM). She would often take Bill along when she volunteered in schools
and at community organizations.
READ ARTICLE: undefined7 Fun Facts
About Bill Gates.
Bill was a voracious reader as a child, spending many hours
poring over reference books such as the encyclopedia. Around the age of 11 or
12, Bill's parents began to have concerns about his behavior. He was doing well
in school, but he seemed bored and withdrawn at times, and his parents worried
he might become a loner. Though they were strong believers in public education,
when Bill turned 13, they enrolled him at Seattle's exclusive preparatory
Lakeside School. He blossomed in nearly all his subjects, excelling in math and
science, but also doing very well in drama and English.
While at Lakeside School, a Seattle computer company offered
to provide computer time for the students. The Mother's Club used proceeds from
the school's rummage sale to purchase a teletype terminal for students to use.
Bill Gates became entranced with what a computer could do and spent much of his
free time working on the terminal. He wrote a tic-tac-toe program in BASIC
computer language that allowed users to play against the computer.
It was at Lakeside School that Bill met Paul Allen,
who was two years his senior. The two became fast friends, bonding over their
common enthusiasm for computers, even though they were very different people.
Allen was more reserved and shy. Bill was feisty and at times combative. Regardless
of their differences, they both spent much of their free time together working
on programs. Occasionally, they disagreed and would clash over who was right or
who should run the computer lab. On one occasion, their argument escalated to
the point where Allen banned Gates from the computer lab. On another occasion,
Gates and Allen had their school computer privileges revoked for taking
advantage of software glitches to obtain free computer time from the company
that provided the computers. After their probation, they were allowed back in
the computer lab when they offered to debug the program. During this time,
Gates developed a payroll program for the computer company the boys hacked into
and a scheduling program for the school.
In 1970, at the age of 15, Bill Gates went into business
with his pal, Paul Allen. They developed "Traf-o-Data," a computer
program that monitored traffic patterns in Seattle, and netted $20,000 for
their efforts. Gates and Allen wanted to start their own company, but Gates's
parents wanted him to finish school and go on to college where they hoped he
would work to become a lawyer.
Bill Gates graduated from Lakeside in 1973. He scored 1590
out of 1600 on the college SAT test, a feat of intellectual achievement that
for several years he boasted about when introducing himself to new people.
Gates enrolled at Harvard University in the fall, originally
thinking of a career in law. But his freshman year saw him spend more of his
time in the computer lab than in class. Gates did not really have a study
regimen. Instead, he could get by on a few hours of sleep, cram for a test, and
pass with a reasonable grade.
Gates remained in contact with Paul Allen, who, after
attending Washington State University for two years, dropped out and moved to
Boston, Massachusetts, to work for Honeywell. Around this time, Allen showed
Gates an edition of Popular Electronics magazine featuring an
article on the Altair 8800 mini-computer kit. Both boys were fascinated with
the possibilities that this computer could create in the world of personal
computing. The Altair was made by a small company in Albuquerque, New Mexico,
called Micro Instrumentation and Telemetry Systems (MITS). Gates and Allen
contacted the company, proclaiming that they were working on a BASIC software
program that would run the Altair computer. In reality, they didn't have an
Altair to work with or the code to run it, but they wanted to know if MITS was
interested in someone developing such software. MITS was, and its president, Ed
Roberts, asked the boys for a demonstration. Gates and Allen scrambled,
spending the next two months writing the software at Harvard's computer lab.
Allen traveled to Albuquerque for a test run at MITS, never having tried it out
on an Altair computer. It worked perfectly. Allen was hired at MITS, and Gates
soon left Harvard to work with him, much to his parents' dismay. In 1975, Gates
and Allen formed a partnership they called Micro-Soft, a blend of
"micro-computer" and "software."
Microsoft (Gates and Allen dropped the hyphen in less than a
year) started off on shaky footing. Though their BASIC software program for the
Altair computer netted the company a fee and royalties, it wasn't meeting their
overhead. Microsoft's BASIC software was popular with computer hobbyists, who
obtained pre-market copies and were reproducing and distributing them for free.
According to Gates's later account, only about 10 percent of the people using
BASIC in the Altair computer had actually paid for it. At this time, much of
the personal computer enthusiasts were people not in it for the money. They
felt the ease of reproduction and distribution allowed them to share software
with friends and fellow computer enthusiasts. Bill Gates thought differently.
He saw the free distribution of software as stealing, especially when it
involved software that was created to be sold.
In February 1976, Gates wrote an open letter to computer
hobbyists, saying that continued distribution and use of software without
paying for it would "prevent good software from being written." In
essence, pirating software would discourage developers from investing time and
money into creating quality software. The letter was unpopular with computer
enthusiasts, but Gates stuck to his beliefs and would use the threat of
innovation as a defense when faced with charges of unfair business practices.
Gates had a more acrimonious relationship with MITS
president Ed Roberts, often resulting in shouting matches. The combative Gates
clashed with Roberts on software development and the direction of the business.
Roberts considered Gates spoiled and obnoxious. In 1977, Roberts sold MITS to
another computer company and went back to Georgia to enter medical school and
become a country doctor. Gates and Allen were on their own. The pair had to sue
the new owner of MITS to retain the software rights they had developed for
Altair.
Microsoft wrote software in different formats for other
computer companies, and, at the beginning of 1979, Gates moved the company's
operations to Bellevue, Washington, just east of Seattle. Gates was glad to be
home again in the Pacific Northwest, and threw himself into his work. All 25
employees of the young company had broad responsibilities for all aspects of
the operation, product development, business development and marketing. With
his acumen for software development and a keen business sense, Gates placed
himself as the head of Microsoft, which grossed approximately $2.5 million in
1979. Gates was only 23.
Gates's acumen for not only software development but also
business operations put him in the position of leading the company and working
as its spokesperson. He personally reviewed every line of code the company
shipped, often rewriting code himself when he saw it necessary. As the computer
industry began to grow with companies like Apple, Intel and IBM developing
hardware and components, Bill was continuously out on the road touting the
merits of Microsoft software applications. He often took his mother with him.
Mary was highly respected and well connected with her membership on several
corporate boards, including IBM's. It was through Mary that Bill Gates met the
CEO of IBM.
In November 1980, IBM was looking for software that would
operate their upcoming personal computer (PC) and approached Microsoft. Legend
has it that at the first meeting with Bill Gates someone at IBM mistook him for
an office assistant and asked him to serve coffee. Gates did look very young,
but he quickly impressed IBM, convincing them that he and his company could
meet their needs. The only problem was that Microsoft had not developed the
basic operating system that would run IBM's new computers. Not to be stopped,
Gates bought an operating system that was developed to run on computers similar
to IBM's PC. He made a deal with the software's developer, making Microsoft the
exclusive licensing agent and later full owner of the software but not telling
them of the IBM deal. The company later sued Microsoft and Gates for
withholding important information. Microsoft settled out of court for an
undisclosed amount, but neither Gates nor Microsoft admitted to any wrongdoing.
Gates had to adapt the newly purchased software to work for
the IBM PC. He delivered it for a $50,000 fee, the same price he had paid for
the software in its original form. IBM wanted to buy the source code, which
would have given them the information to the operating system. Gates refused,
instead proposing that IBM pay a licensing fee for copies of the software sold
with their computers. Doing this allowed Microsoft to license the software they
called MS-DOS to any other PC manufacturer, should other computer companies
clone the IBM PC, which they soon did. Microsoft also released software called
Softcard, which allowed Microsoft BASIC to operate on Apple II machines.
Between 1979 and 1981, Microsoft's growth exploded, and
staff increased from 25 to 128. Revenue also shot up from $2.5 million to $16
million. In mid-1981 Gates and Allen incorporated Microsoft, and Gates was
appointed president and chairman of the board. Allen was named executive vice
president.
By 1983, Microsoft was going global with offices in Great
Britain and Japan, and with 30 percent of the world's computers running on its
software. But 1983 also brought news that rocked Microsoft to its very
foundation. Paul Allen was diagnosed with Hodgkin's disease. Though his cancer
went into remission a year later with intensive treatment, Allen resigned from
company that same year. Rumors abound as to why Allen left Microsoft. Some say
Bill Gates pushed him out, but many say it was a life-changing experience for
Allen and he saw there were other opportunities that he could invest his time
in.
Though their rivalry is legend, Microsoft and
Apple shared many of their early innovations. In 1981 Apple invited Microsoft
to help develop software for Macintosh computers. Some developers were
involved in both Microsoft development and the development of Microsoft
applications for Macintosh. The collaboration could be seen in some shared
names between the Microsoft and Macintosh systems.
It was through this knowledge sharing that Microsoft was to
develop Windows, a system that used a mouse to drive a graphic interface,
displaying text and images on the screen. This differed greatly from the
text-and-keyboard driven MS-DOS system where all text formatting showed on the
screen as code and not what actually would be printed. Bill Gates quickly
recognized the threat this kind of software might pose for MS-DOS and Microsoft
overall. For the unsophisticated user—which was most of the buying public—the
graphic imagery of the competing VisiCorp software used in a Macintosh system
would be so much easier to use. Gates announced in an advertising campaign that
a new Microsoft operating system was about to be developed that would use a
graphic interface. It was to be called "Windows," and would be
compatible with all PC software products developed on the MS-DOS system. The
announcement was a bluff, in that Microsoft had no such program under
development. But as a marketing tactic it was sheer genius as nearly 30 percent
of the computer market was using the MS-DOS system and would wait for Windows
software rather than change to a new system. Without people willing to change
formats, software developers were unwilling to write programs for the VisiCorp
system and it lost momentum by early 1985.
In November 1985, Bill Gates and Microsoft launched Windows;
nearly two years after his announcement. Visually the Windows system looked
very similar to the Macintosh system Apple Computer Corporation had introduced
nearly two years earlier. Apple had earlier given Microsoft full access to
their technology while it was working on making Microsoft products compatible
for Apple computers. Gates had advised Apple to license their software but they
ignored the advice, being more interested in selling computers. Once again,
Gates took full advantage of the situation and created a software format that
was strikingly similar to the Macintosh. Apple threatened to sue, and Microsoft
retaliated, saying it would delay shipment of its Microsoft-compatible software
for Macintosh users. In the end, Microsoft prevailed in the courts because it
could prove that while there were similarities in how the two software systems
operated, each individual function was distinctly different.
In March 1986, Bill Gates took Microsoft public with an
initial public offering (IPO) of $21 per share. Gates held 45 percent of the
company's 24.7 million shares and became an instant millionaire at age 31.
Gates's stake at that time was $234 million of Microsoft's $520 million. Over
time, the company's stock increased in value and split numerous times. In 1987,
Bill Gates became a billionaire when the stock raised to $90.75 a share. Since
then, Gates has been at the top, or at least near the top, of Forbes's annual list
of the top 400 wealthiest people in America. In 1999, with stock
prices at an all time high and the stock splitting eight-fold since its IPO,
Gates's wealth briefly topped $101 billion.
Yet, Bill Gates never felt totally secure about the status
of his company. Always having to look over his shoulder to see where the
competition was, he developed a white-hot drive and competitive spirit. Gates
expected everyone in the company to have the same dedication. One story of
Gates's assistant coming to work early to find someone sleeping under a desk.
She considered calling security or the police, until she discovered it was
Gates.
Bill Gates's intelligence allowed him to be able to see all
sides of the software industry—product development and corporate strategy. When
analyzing any corporate move, he would develop a profile of all the possible
cases and run through them, asking questions about anything that could possibly
happen. His confrontational management style became legend as he would
challenge employees and their ideas to keep the creative process going. An
unprepared presenter could hear, "That's the stupidest thing I've ever
heard!" from Gates. But this was as much a test of the rigor of the
employee as it was Gates's passion for his company. He was constantly checking
the people around him to see if they were really convinced of their ideas.
Outside the company, Bill Gates was gaining a reputation as
a ruthless competitor. Several tech companies, led by IBM, began to develop
their own operating system, called OS/2, to replace MS-DOS. Rather than give in
to the pressure, Gates pushed ahead with the Windows software, improving its
operation and expanding its uses. In 1989, Microsoft introduced Microsoft
Office, which bundled office productivity applications such as Microsoft Word
and Excel into one system that was compatible with all Microsoft products. The
applications were not as easily compatible with OS/2. Microsoft's new version
of Windows sold 100,000 copies in just two weeks, and OS/2 soon faded away.
This left Microsoft with a virtual monopoly on operating systems for PCs. Soon
the Federal Trade Commission began to investigate Microsoft for unfair
marketing practices.
Throughout the 1990s, Microsoft faced a string of Federal
Trade Commission and Justice Department investigations. Some related
allegations that Microsoft made unfair deals with computer manufactures who
installed the Windows operating system on their computers. Other charges
involved Microsoft forcing computer manufactures to sell Microsoft's Internet
Explorer as a condition for selling the Windows operating system with their
computers.
At one point, Microsoft faced a possible break up of its two
divisions—operating systems and software development. Microsoft defended
itself, harking back to Bill Gates's earlier battles with software piracy and
proclaiming that such restrictions were a threat to innovation. Eventually,
Microsoft was able to find a settlement with the federal government to avoid a
breakup. Through it all, Gates found some inventive ways to deflect the
pressure with lighthearted commercials and public appearances at computer trade
shows during which he posed as Star Trek's Mr. Spock. Gates
continued to run the company and weather the federal investigations through the
1990s.
In 1987, a 23-year-old Microsoft product manager named Melinda French
caught the eye of Bill Gates, then 32. The very bright and organized Melinda
was a perfect match for Gates. In time, their relationship grew as they
discovered an intimate and intellectual connection. On January 1, 1994, Melinda
and Bill were married in Hawaii. But only a few months later heartbreak struck
Bill Gates as his mother succumbed to breast cancer, passing away that June.
Gates was devastated.
Bill and Melinda took some time off in 1995 to travel to
several countries and get a new perspective on life and the world. In 1996,
their first daughter, Jennifer, was born. A year later, Gates moved his family
into a 55,000-square-foot, $54-million house on the shore of Lake Washington.
Though the house serves as a business center, it is said to be a very cozy home
for the couple and their three children. (Their son, Rory, was born in 1999,
and a second daughter, Phoebe, arrived in 2002.)
With Melinda's influence, Gates took an interest in filling
his mother's role as a civic leader. He began to realize that he had an
obligation to give more of his wealth to charity. Being the consummate student
he was, Gates studied the philanthropic work of Andrew Carnegie and John D.
Rockefeller, titans of the American industrial revolution. In 1994,
Gates and his wife established the William H. Gates Foundation, which was
dedicated to supporting education, world health and investment in low-income
communities. In 2000, the couple combined several family foundations to form
the Bill & Melinda Gates Foundation. They started out by making a $28
billion contribution to set up the foundation.
Bill Gates stepped down from the day-to-day operations of
Microsoft in 2000, turning over the job of CEO to college friend Steve Ballmer,
who had been with Microsoft since 1980. He positioned himself as chief software
architect so he could concentrate on what was for him the more passionate side
of the business, though he remained chairman of the board.
Over the next few years, his involvement with the Bill &
Melinda Gates Foundation occupied much of his time and even more of his
interest. In 2006, Gates announced he was transitioning himself from full-time
work at Microsoft to devote more quality time to the foundation. His last full
day at Microsoft was June 27, 2008.
In addition to all the accolades of being one of the richest
and most successful businessmen in the history of the world, Bill Gates has
also received numerous awards for philanthropic work. Time magazine
named Gates one of the most influential people of the 20th century. The
magazine also named Gates, his wife Melinda and rock band U2's lead singer, Bono, as the 2005 Persons
of the Year.
Gates holds several honorary doctorates from universities
throughout the world and an honorary Knight Commander of the Order of the
British Empire bestowed by Queen Elizabeth
II in 2005. In 2006, Gates and his wife were awarded the Order
of the Aztec Eagle by the Mexican government for their philanthropic work
throughout the world in the areas of health and education.
In February 2014, Gates announced that he would be stepping
down as chairman of Microsoft in order to move into a new position as
technology adviser. In addition to Gates's transition, it was reported that
longtime Microsoft CEO Steve Ballmer would be replaced by 46-year-old Satya
Nadella.
These days, Gates continues to devote much of his time and
energy to the work of the Bill & Melinda Gates Foundation. The organization
tackles international and domestic issues, such as health and education. One
aspect of its work in the United States is helping students become college
ready. In 2015, Gates spoke out in favor of national Common Core standards in
grades K through 12 and charter schools.
Gates also proved to be a groundbreaking employer around
this time: The foundation announced that it would give its employees a year's
paid leave after the birth of a child or the adoption of a child.
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