Bill Gates co-founded Microsoft with Paul Allen in 1975 after the pair developed software for the Altair computer, building the company that became the source of his fortune before he shifted much of his attention to philanthropy. [1][4]
From Altair BASIC to Microsoft
Microsoft's history traces the business to 1975, when Gates and Paul Allen developed a version of BASIC for the Altair 8800 and sold it to MITS in Albuquerque. In a Smithsonian oral history, Gates described this as the next step in a programming partnership that had already produced paid work and an earlier microprocessor project he funded himself. [1][3]
The pair formalized their partnership in 1977. Gates later recalled that he and Allen still owned essentially the whole company through 1981, apart from a small share given to Steve Ballmer, before Microsoft broadened employee ownership through stock options. That early founder equity became the economic base of Gates's fortune as the software business expanded. [2][3][5]
From Microsoft leadership to philanthropy
The Gates Foundation says Gates co-founded Microsoft in 1975 and led it as it became a major supplier of personal and business software. He eventually reduced his day-to-day role and in 2008 shifted his primary focus to the foundation, making the move from software executive to large-scale philanthropy a durable second chapter of the wealth created through Microsoft. [4]
The key financial mechanism was therefore ownership created at founding and retained as Microsoft scaled, not executive compensation alone. Gates's later philanthropy redistributed part of wealth that had already been created through founder equity, while the company's revenue and market value remain distinct from his personal holdings at any one point in time. [3][4][5]
Sources for background
Sources reviewed Sep 15, 2026.
- The History of Microsoft - 1975 · Microsoft · Feb 5, 2009
- The History of Microsoft - 1977 · Microsoft · Feb 19, 2009
- Interview with Bill Gates · Smithsonian National Museum of American History
- Bill Gates · Gates Foundation
- Bill Gates · Forbes · Mar 10, 2026
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