You probably think you know the answer. Bill Gates. That’s the name that pops up in trivia games and on the cover of magazines. But if you’re asking who is the founder of Microsoft, you’re actually looking for two people, and honestly, the dynamic between them is way more interesting than a simple Wikipedia entry suggests.
It was Bill Gates and Paul Allen.
They weren't just business partners; they were two kids from Seattle who shared a weird, borderline obsessive love for machines that took up entire rooms. In 1975, they officially started what would become the world's largest software company. But the path from a cramped office in Albuquerque to the top of the Fortune 500 wasn't a straight line. It was messy. It involved a lot of late-night coding, some pretty intense arguments, and a gamble on a computer called the Altair 8800.
The Lakeside school connection
Long before Microsoft was a thing, Gates and Allen were just students at Lakeside School. This place was special. It was one of the few schools in the country that had a computer terminal. We’re talking about the late 60s here. Computers weren't "personal" back then. They were massive, expensive, and intimidating.
Gates was the younger one, a math prodigy with a competitive streak that could melt glass. Allen was the dreamer, the guy who saw the big picture. He was the one who spent his afternoons scouring tech magazines, looking for the next big shift. They bonded over the Teletype Model 33 ASR. They’d spend hours debugging programs and finding ways to get free computer time.
Actually, they even got in trouble for it. They found a bug in the system that allowed them to manipulate their allocated hours. Instead of banning them, the company—Computer Center Corporation—hired them to find more bugs. That’s kind of the vibe of their entire partnership: breaking things to understand how to build them better.
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Why Albuquerque?
Most people assume Microsoft started in a garage in Silicon Valley. Nope. It started in New Mexico.
In late 1974, Paul Allen saw a cover of Popular Electronics. It featured the MITS Altair 8800. He ran to find Gates. He knew this was the "moment." If they didn't write software for this new microcomputer, someone else would. They called Ed Roberts, the guy who ran MITS, and told him a total lie. They told him they had a BASIC interpreter ready for the Altair.
They had nothing.
They spent the next eight weeks in a coding frenzy at Harvard, where Gates was a student. They weren't even sure if their code would work because they didn't actually have an Altair to test it on. Allen flew to Albuquerque to demo it. Against all odds, it worked. Microsoft—originally styled as "Micro-Soft"—was born in April 1975.
The friction that fueled the fire
If you look into the history of who is the founder of Microsoft, you’ll find that the relationship between Gates and Allen wasn't always sunshine and rainbows. It was productive, sure, but it was also incredibly tense. Gates was a relentless taskmaster. He’d check the parking lot to see who was leaving early. He pushed everyone, especially Allen.
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By the early 80s, things got dark. Allen was diagnosed with Hodgkin’s lymphoma. While he was undergoing treatment, he allegedly overheard Gates and Steve Ballmer (who joined later as the first business manager) discussing how to dilute Allen's shares in the company because they felt he wasn't contributing enough.
That’s a heavy blow.
Allen eventually left the day-to-day operations in 1983. He stayed on the board for years, but the "duo" era was effectively over. Despite the drama, they remained in touch until Allen passed away in 2018. Gates later admitted that without Allen, Microsoft simply wouldn't have happened. Allen was the one who pushed the idea of "a computer on every desk and in every home." Gates was the one with the tactical brilliance to make that vision a reality.
The IBM deal that changed everything
You can't talk about the founders without mentioning the 1980 deal with IBM. This is the move that turned a successful small company into a global empire. IBM needed an operating system for their upcoming PC. Microsoft didn't have one.
So, what did they do? They bought the rights to a system called QDOS (Quick and Dirty Operating System) from a local programmer named Tim Paterson for $50,000.
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They refined it into MS-DOS. But here’s the genius part: they didn't sell it to IBM. They licensed it. This meant every time someone else made an IBM-compatible computer, Microsoft got a cut. It was a masterstroke of business strategy that showcased Gates’s legal and commercial acumen. It’s also why, for a long time, Microsoft felt like it was everywhere. Because it was.
Beyond the code
Today, when we ask who is the founder of Microsoft, we often look at what they did with their billions. Bill Gates became one of the world's most prominent philanthropists through the Bill & Melinda Gates Foundation. He’s obsessed with global health, climate change, and eradicating diseases like polio.
Paul Allen took a different route. He bought the Portland Trail Blazers and the Seattle Seahawks. He poured money into brain research and space exploration through his company, Vulcan Inc. He was the "Idea Man" until the very end.
What to take away from the Microsoft story
If you're looking to start your own thing or just curious about how giants are built, there are a few real-world lessons here.
- Partnerships require balance. You don't need two of the same person. You need a visionary and a builder. Allen saw the future; Gates built the fortress.
- Speed beats perfection. They sold a product they hadn't even finished yet to MITS. They figured out the details later.
- Ownership is everything. The IBM licensing deal is the perfect example of why owning the intellectual property is more valuable than a one-time big paycheck.
- Conflict is inevitable. Even the most successful partnerships in history had massive, friendship-ending fights. It’s part of the process.
To really understand the origins of the tech we use every day, start by looking at the 1975 Altair demo. It’s a reminder that even the biggest empires start with two people in a room, arguing over a piece of code that might not even work.
If you want to dive deeper into the technical side of this history, look up the "Open Letter to Hobbyists" written by Gates in 1976. It’s a fascinating, and at the time very controversial, look at how he viewed software as a product that should be paid for, rather than shared for free. It basically set the stage for the modern software industry as we know it today.
Next Steps for Research:
- Read Idea Man by Paul Allen for his perspective on the early days and the fallout with Gates.
- Look into the MITS Altair 8800 to see the primitive hardware that started the personal computer revolution.
- Research the Antitrust Trial of 1998 to understand how Microsoft's dominance under Gates eventually led to massive legal challenges.