Bill Gates : Biography
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| Bill Gates
Bill
Gates : Biography
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.
Born
on October 28, 1955, in Seattle, Washington, 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.
Early Life
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.
Bill
was a voracious reader as a child, spending many hours pouring 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. 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 Lakeside School, an exclusive preparatory
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 where Bill met Paul Allen, who was two years his senior.
The two became fast friends, bonding on their common enthusiasm over computers,
even though they were very different. Allen was more reserved and shy. Bill was
feisty and at times combative. 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.
Early Career
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. In the summer of 1974, Gates joined Allen at Honeywell.
During this time, Allen showed Gates an edition ofPopular 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 of 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
end of 1978, Gates moved the company's operations to Bellevue Washington, just
east of Seattle. Bill 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 $2.5 million in 1978. Gates was only 23.
The Rise of Microsoft
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 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.
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 wrong doing.
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
1978 and 1981, Microsoft's growth exploded, and staff increased from 25 to 128.
Revenue also shot up from $4 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.
The Invention of
Microsoft Windows
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
develeopment, 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 was 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 VisiCorp software 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
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' 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 drive and dedication. One story goes that one of
Gates's assistants had come to work early to find someone sleeping under a
desk. She considered calling security or the police when 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
would 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 testing 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 into 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.
Microsoft
faced a string of Federal Trade Commission and Justice Department
investigations throughout the 1990s. 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 light-hearted
commercials and public appearances at computer trade shows posing as Star
Trek's Mr. Spock. Gates continued to run the company and weather the federal
investigations through the 1990s.
Personal
Life
In
1989, a 28-year-old Microsoft executive named Melinda French caught the eye of
Bill Gates, then 37. 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
was diagnosed with breast cancer. She died in June 1994. 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.
Philanthropic Efforts
With
wife 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 and 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. He
still remains chairman of the board. Over the next few years, his involvement
with the Bill and 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 most successful and richest
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
also holds several honorary doctorates from universities throughout the world
and an honorary Knight Commander of the Order of the British Empire by Queen
Elizabeth II. 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.
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