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Microsoft Co-Founder Paul Allen Hits Out at Gates
- meterplech 16y agoIt seems to me the biggest allegation here is that Bill Gates and Steve Ballmer tried to dilute his shares when he was diagnosed with cancer the first time. I hate to seem callous here, but, that might've completely made sense. God forbid if Allen had died, the company, still pre-IPO startup whose main product was MS-DOS (pre Office or any version of Windows) would want its shares controlled by people with business interests in the company. When you are a startup you want to align incentives properly and yes, people who are unfortunately unable to contribute, even if it's through no fault of their own probably shouldn't have huge amounts of stock. Besides that allegation I don't really know what else here is that negative on Bill Gates. edit: MS-DOS not MS-DOC. Mistyped
- stretchwithme 16y agoThat MS-DOC program didn't sell a single copy. That's why even founders should be on a vesting schedule.
- rbanffy 16y agoThere would be nicer ways to shield the company from that. They could talk to Allen, make sure that, in the possible event of his death, they would take care of his family in case the company succeeded. In all my commercial ventures, my partners were also my friends. I would never, ever even entertain doing something like this to a perfectly healthy partner, much less one with a serious health problem.
- meterplech 16y agoI agree that you shouldn't screw a friend over obviously. But, there does need to be some way to make sure equity of an early stage company is in the hands of the people who are most incentivized for its success. Ideally Gates would offer a contract where he could buy shares from Allen to make sure he and his family was taken care of. But- I do understand the logic of trying to ensure key stakeholders in the company are leading it.
- kenjackson 16y agoTargeted dilution of individual shareholders seems extremely shady. Almost seems like it should be illegal. As noted by someone else, they should have simply retained first option to buy any portio of Allen's shares in the case where his shares would change hands. Actually that should probably apply to all major insiders. Intentionally trying to dilute his shares, if this did indeed happen, is tantamount to stealing in my eyes.
- yannickt 16y agoI dunno. It looks like Allen's contributions as a co-founder back in the DOS days were very significant. I think he deserved at least a face-to-face, open and honest discussion.
- meterplech 16y agoThat's completely fair. I agree with that. But, we don't know if this was a discussion between the two (Gates and Ballmer) with the intent of discussing it with him afterward.
- adammichaelc 16y agoI think you are right. In my opinion you have to handle each situation separately. So you dilute because it's best for the company, and then you also (assuming you have the means) take care of your friend monetarily and help lighten the medical expense load for him.
- stretchwithme 16y ago"I'm not sure Bill would ever have dropped out of Harvard if it wasn't for Paul," Mr. Yoffie said, referring to Mr. Allen's role in encouraging Mr. Gates to leave college to start Microsoft. "I don't know whether Steve Jobs, without Wozniak, would have ever gotten things together." baloney.
- david927 16y agoYoffie mixed up Wozniak and Jobs there.
- stretchwithme 16y agototally, Woz is awesome, to be sure. But Jobs has been running without him quite well of late.
- burgerbrain 16y agoWithout Woz, Jobs would have never even had a product to begin with. Forget having a company, there would have been no reason to form a company.
- stretchwithme 16y agoMany companies built personal computers. Only one built the Mac. Jobs would have found someone else. Being able to make things is not as common a skill as knowing how to make things great.
- rtaycher 16y agoMy impression was that Woz developed apple 1(which gave apple some funds) by himself(with jobs only encouraging/pushing) and developed a very large of the apple II(which made apple a multi million dollar company) and then not much else. which was one of the first personal computers and was transformational(helping introduce personal computers into the world including a wide variety of clones. Jobs was the team head who designed the first mac(which was transformational in its own way-one of the first gui ) personal computers). At least according to foklore.org a decent number of the brilliant people working for apple on the mac and other projects were there in a significant part because they fell in love with woz's work.
- winestock 16y agoCringley's account of Paul Allen's fight against Hodgkin's disease while at Microsoft may be relevant. http://www.pbs.org/cringely/pulpit/2006/pulpit_20060330_000890.html http://www.pbs.org/cringely/pulpit/2006/pulpit_20060330_0008...
- smackay 16y agoCringley's account is very critical of Gates and Balmer, particularly on the subject of getting control of Paul Allen's shares in Microsoft should the worst happen. While this seems very cold-blooded it was probably a reasonable course of action given the circumstances - look what happened to CraigsList when one of the founders sold out to eBay.
- yannickt 16y agoMy interpretation of the article is that Allen felt betrayed because Gates and Ballmer were having these discussions behind his back.
- dantheman 16y agoExactly, everything should be done above board -- when an unexpected event happens and the outcome is unknown it doesn't hurt to have a contingency plan if stuff doesn't work out.
- codingthewheel 16y agoDifficult to see how publicizing this stuff could be beneficial for Mr. Allen. At that level, and sitting on top of a multi-billion dollar fortune, it almost never behooves you to say anything negative about anybody -- least of all one of your former partners. I also think complaining about not getting a bigger share of MS stock, when you've got 14 billion in the bank...not exactly the stuff of which Jedi are made.
- silvestrov 16y agoHe wants to be acknowledged. Everybody knows Bill Gates and sees him as the smart and great computer guy, while Mr. Allan is an unknown. It's like 2 brothers where the lesser talented uses all his life to proof he's just as good and therefore never gets to create something.
- melling 16y agoWho destroyed Lotus, WordPerfect, Borland and Netscape? Who swore under oath that the browser is part of the operating system, and couldn't be removed? Why are 9 out of 10 desktop computers running Windows? I think only one man gets the credit. :-) Hopefully, he can ruthlessly solve a few of the long-running problems in the world.
- bad_user 16y agoI don't see Gates as the great computer guy. I look at him as a ruthless evil genius that made Microsoft what it is. Of course that's partly because he's also a "great computer guy". To make an analogy with Apple, if anything, his role at Microsoft was more like that of Steve Jobs, rather than that of Steve Wozniak; he provided the vision, he made the business calls that made Microsoft. Bill Gates does have a different style than Steve Jobs and doesn't have the same distortion field and attractiveness, but his speeches at Ted are great nonetheless (which makes me think he was bored at Microsoft :)).
- sushilchoudhari 16y agoThis is a very interesting article. I am myself working on a project and considering good friends to be co-founders in that. But based on what Paul Allen is mentioning here and based on few other stories of startups which made it big like Facebook, few thoughts came to my mind: 1) Is it that to make it really big, to the likes of Microsoft, Facebook a founder has to play games and trick his own friends in a way that the founder owns majority of stake in the company. I am not necessarily saying it is bad, it is just a observation and want your opinion. It is totally possible that one of the co-founders is so passionate about the idea that he works hard by twice or thrice as much as other cofounder and in the process somehow manages to get hold of major equity. What do you think? Is it necessary to be evil to make it big? Does your passion blind you somewhere in the process where one cannot distinguish right from "not so much right"? 2) I dont see and havent heard about Steve Jobs being great friends with Steve Wozniak. So is Bill gates with Paul Allen. Facebook Mark Z and other cofounders have some fights between them too. Given this and stories from similar or smaller companies, it makes me think, is it possible to have a good and healthy friend ship like relationship with your co-founder after a period of time? Or with the turn of events in the company it is bound to happen that the relationship will go sour? What do you guys think?
- michael_dorfman 16y agoSee http://news.ycombinator.com/item?id=2386411 http://news.ycombinator.com/item?id=2386411 for the Vanity Fair article by Allen.
- c2 16y agoI feel like I've worked with people like Paul Allen (programmers). They tend to over value their own contributions and have "revisionist histories" when considering their relationship with their manager, but really it comes down to how much recognition they received. The quote about Paul wanting significantly more shares for his contributions to SoftCard specifically ring true. SoftCard might have been a sales success, but comparing it's impact on Microsoft to Basic itself is a little off.
- hvs 16y agoIt's hardly fair to look back with 30 years of hindsight and say that BASIC was more important to a company than SoftCard. Obviously, we know that now, but that doesn't speak to their specific situation.
- rbanffy 16y agoIIRC, Paul Allen wrote most of Microsoft's original BASIC interpreter... And the emulator they used to develop it.
- c2 16y agoAccording to Wikipedia, you recall wrong. Gates wrote the interpreter and Allen wrote the emulator: http://en.wikipedia.org/wiki/Microsoft#History http://en.wikipedia.org/wiki/Microsoft#History
- rbanffy 16y agoThanks for the correction. I really had the impression Allen had more to do with the BASIC interpreter...
- gwern 16y agoThe _Vanity Fair_ excerpts have Allen writing the emulator, all the other development tools, the loader, and then he wrote 25% of the interpreter itself: http://www.vanityfair.com/business/features/2011/05/paul-allen-201105?currentPage=3 http://www.vanityfair.com/business/features/2011/05/paul-all...
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- eyeforgotmyname 16y agoI always thought that Gates was the key business guy and Allen the key technology guy, Gates made the money and Allen made the product. Once the product was out Allen was no longer required, the ball was in Gates court and he sold the shit out of it. Am I wrong in this view?
- yannickt 16y agoCringely's article, as well as Allen's accomplishments outside of Microsoft make that questionable. Gates may have had more business savvy, but it seems pretty evident that Allen was in no shortage of it either. To put it another way, I don't think Allen was to Gates what Wozniak was to Jobs.
- eyeforgotmyname 16y agoSo then what was Gates contribution? I thought he was a brilliant businessman but that he wasn't really a tech guy. Is that wrong?
- whyenot 16y agoGates was/is very much a tech guy. Here is a quote from his Wikipedia article At 13 he enrolled in the Lakeside School, an exclusive preparatory school. When he was in the eighth grade, the Mothers Club at the school used proceeds from Lakeside School's rummage sale to buy an ASR-33 teletype terminal and a block of computer time on a General Electric (GE) computer for the school's students. Gates took an interest in programming the GE system in BASIC, and was excused from math classes to pursue his interest. He wrote his first computer program on this machine: an implementation of tic-tac-toe that allowed users to play games against the computer. Gates was fascinated by the machine and how it would always execute software code perfectly. When he reflected back on that moment, he said, "There was just something neat about the machine." After the Mothers Club donation was exhausted, he and other students sought time on systems including DEC PDP minicomputers. One of these systems was a PDP-10 belonging to Computer Center Corporation (CCC), which banned four Lakeside students—Gates, Paul Allen, Ric Weiland, and Kent Evans—for the summer after it caught them exploiting bugs in the operating system to obtain free computer time.
- nickpinkston 16y agoAll Ye founders take note and prepare thy operating agreements - for the waters of startups are red with the blood of ye fellow founders!
- kloncks 16y agoIs it just me or was Bill's reaction so cordial and professional? I loved it; thought it was great. "While my recollection of many of these events may differ from Paul's, I value his friendship and the important contributions he made to the world of technology and at Microsoft," Mr. Gates said in a written statement.
- yannickt 16y agoIt is exactly the kind of response I would expect from someone in his position. He has nothing to gain by reacting overly negatively, and his legacy is not exactly at stake.
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- gnosis 16y agoThat statement was probably written by a professional speech writer under advice from a legal team and a PR company.
- dko 16y agoSet agreements in stone as early possible. No matter how much trust there is, and no matter how awkward it may seem. And I can't help but draw parallels with The Social Network, which incidentally is also an account by an 'ousted' co-founder.
- yannickt 16y agoCringely wrote a piece in 2006 about Allen progressively distancing himself from Gates, Ballmer and Microsoft. It certainly raises questions about Gates' character. http://www.pbs.org/cringely/pulpit/2006/pulpit_20060330_000890.html http://www.pbs.org/cringely/pulpit/2006/pulpit_20060330_0008... Edit: Beaten to the punch by about 2 hours. Oops.
- tmsh 16y agoThe article makes it out as if Paul Allen is some sort of unlucky, dabbling entrepreneur post-Microsoft: Many of his business investments, like the cable company Charter Communications, software company Asymetrix Corp. and set-top box maker Digeo Inc., have either flopped or fared poorly for him. I don't think so: http://www.vulcan.com/ http://www.vulcan.com/
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- wmboy 16y agoAdmit it, you're more likely to read the book now than you would have been... He obviously wants his book to be successful (though not for monetary reasons) so it would make senese to write about something controversial - in this case putting Bill Gates in negative light is obviously the easist way to get attention.
- elvirs 16y agookay, may be Paul could have made a couple of billions more. but lets keep in mind that all that fortune was made for him after Paul left the company. Now he writes the this book trashing his old friend and partner who actually made him rich? To me it looks like this is more of an ego issue for Paul rather than letting the world know truth about Bill.