If you think of tech-giant Microsoft one name probably springs to mind… Bill Gates. It’s fair to say that Bill Gates has become the public face of Microsoft since its formation in 1975. But does Gates actually own the company or is this a marketing ploy to help humanize the brand?
No, Bill Gates does not technically own Microsoft. As a public company, stocks in Microsoft can be freely bought and sold. Although he was once the company’s biggest shareholder, Bill was overtaken by Steve Ballmer in 2014. Bill has been selling and donating his Microsoft shares for several years, and currently owns less than 1% of the corporation.
With a company worth over $1 trillion, the question on everyone’s lips is ‘why did Bill Gates sell his shares in Microsoft?’. Today is your lucky day because in this post we’ll be looking at the highs and lows of Bill’s relationship with Microsoft. Stay tuned!
The Microsoft Story
Bill’s journey with Microsoft started in 1975. After reading an article about the Altair 8800 microcomputer, Bill was inspired to develop an interpreter for the platform. Together with his college friend, Paul Allen, the duo produced BASIC.
They went on to demonstrate BASIC to Micro Instrumentation and Telemetry Systems (MITS), the maker of the Altair 8800, who regarded the project as a huge success. The pair landed a distribution deal with MITS, which encouraged Gates to drop out of Harvard University.
From there, Gates and Allen worked together under the name ‘Micro-soft’’. Between 1975 and 1980, Microsoft continued to release and sell variants of BASIC, plus the Z-80 SoftCard and Xenix operating system.
But Microsoft hit the jackpot in July 1980 when they were approached by IBM Personal Computer to develop a new operating system. At the time IBM was the world’s biggest computer supplier. The Microsoft team spent a year working on the project, it was eventually released under the name ‘MS-DOS’ in 1981.
Microsoft made $33 million in sales from MS-DOS in 1983 alone. Other manufacturers of IBM-compatible PCs started to turn for Microsoft for software, which quickly established Microsoft as a leading software provider.
By 1985, Microsoft released its retail operating system, Windows. Complete with a graphical user interface, Windows 1.0 featured scroll bars, drop-down menus, and programmes such as Paint, Calculator, Reversi, and Notepad. The operating system skyrocketed and established Microsoft as a market leader.
Microsoft continued to go from strength-to-strength. In 1995 they released Windows 95, which sold over 7 million copies in the 5 weeks. By this point, new features had been introduced, such as Internet Explorer, a start menu, folders, and the right-click.
But with great success comes great responsibility. Microsoft started to attract the attention of the United States Department of Justice. In 1998 in what’s been described as the ‘anti-trust case of the century’, the DoF accused Microsoft of illegally maintaining a monopoly.They claimed that by embedding certain programmes within Windows, competing operating systems were being suppressed.
In the wake of the court proceedings, Bill Gates announced that he would be stepping down as Microsoft CEO. In his public statement, Gates claimed that he was stepping down to dedicate more time to promoting the next generation of Microsoft.
Two years later after several appeals, the DoJ settled the Microsoft antitrust case. They determined that there was an illegal monopoly, and subsequently imposed sanctions on Windows to make it more susceptible to competition.
When Microsoft first went public in 1986, Bill was the largest shareholder in the company with a 49% stake. Since stepping down in 2000, Gates has continually sold or donated as many shares as the law allowed him.
Will there soon be a day where Bill Gates has no stakes in Microsoft? Only time will tell.