Bill Gates: A Successful Technical Entrepreneur - Essay Example

Introduction One of the most popular and indeed most successful technical entrepreneurs of our today is Bill Gates, the man behind the computer manufacturing giant, Microsoft. The victory of Microsoft Corporation is widely known and witnessed by several years. Today, it operates in more than 90 countries in North America, Latin America, Europe, the Middle East and Africa, Japan, Asia Pacific and Greater China (Microsoft, 2006). Microsoft generates revenue by developing, manufacturing, licensing and supporting a wide range of software products for many computing devices. Other software products include operating systems for servers, personal computers, and intelligent servers (Microsoft, 2006). Profile of Bill Gates Rated by Forbes Magazine as the 2005 wealthiest person in the world for the twelfth consecutive year, Bill Gates estimated wealth amounts to $27.38 billion based on Microsoft's current stock price (Marcus, 2006). Bill Gates is the co-founder, chairman and chief software architect of Microsoft Corporation, the world's largest software company. He is also the founder of a digital image archiving company that goes by the name of Corbis, which is one of the world's most promising resources of visual information - a broad digital archive of art and photography from public and private collections worldwide. He is one of the best known entrepreneurs of the personal computer revolution and is widely respected and also widely criticised as having built his business through unfair, illegal, or anti-competitive business practices, and this was recently demonstrated by the US government taking Microsoft to court, an action which was repeated in Europe as well (Didion, 2004). Despite his vast wealth, Bill Gates has donated approximately 51% of his total fortune to various charitable organisations and scientific research programmes. Bill Gates was born on the 28th of October 1955 in Seattle, Washington to William Gates Senior and Mary Maxwell Gates (McSheriff, 2002). His family was wealthy, and had a strong tradition of education and professionalism. His father was a prominent lawyer, his mother was the first woman regent of the University of Washington and his maternal grandfather was a national bank president (McSheriff, 2002). It is safe to say that Bill Gates came from a privileged background. Bill Gates also has two younger sisters, Kristanne and Libby Gates. Bill Gates was educated at some of the most prestigious schools in the state, and he particularly excelled in elementary school in mathematics and sciences (McSheriff, 2002). Bill Gates went to Seattle's most exclusive preparatory school, Lakeside School where tuition in 1967 was $5 000, more than that at Harvard which was $1 760 (McSheriff, 2002). It was at this school that Bill Gates got introduced to computers as the school rented time on a server, which allowed Bill Gates to pursue an interest in computers at a time when they were not commercially available. He was also a member of the Boy Scouts of America, even attaining the rank of Life Scout during his membership (Peerman, 1999). When he was at high school, he founded a company which sold traffic flow data systems to state governments with Paul Allen. He also helped to create a payroll system in COBOL for a company in Portland, Oregon (Peerman, 1999). In 1973 he enrolled in Harvard University for a pre-law programme where he met his future business partner Steve Ballmer. During his second year, together with Paul Allen and Monte Davidoff, he co-wrote Altair BASIC for the Altair 8800, and dropped out of Harvard during his third year to pursue a career in software development (Murdock, 1998). Despite his success, Bill Gates was briefly jailed in Albuquerque for racing his Porsche 911 in the New Mexico desert. Bill Gates first recognized an opportunity in 1975 after reading an issue of the Popular Electronics that demonstrated the Altair 8800. Bill Gates contacted the creators of the new microcomputer to inform them that he and others had developed a version of the programming language called BASIC for the platform (Murdock, 1998). This was untrue as they had never used an Altair and they had not developed a code for it. Within eight weeks they had developed an Altair emulator that ran on a minicomputer, and then the BASIC interpreter. Allen and Gates flew to the company, Micro Instrumentation and Telemetry Systems (MITS) to demonstrate this new system (Murdock, 1998). This demonstration was a success and resulted in a deal with MITS to buy the rights to Allen and Gate's BASIC for the Altair platform. This enabled Bill Gates to leave Harvard along with Allen to found Micro-Soft, which later became Microsoft Corporation (Murdock, 1998). Bill Gates is a research technical entrepreneur as his profile demonstrates. He had a background in computer science while studying in Harvard, one of the few schools that have computers during that time. According to Audia (2005), research technical entrepreneurs are those who used their background in universities or any scientific environment. Bill Gates' stay in Harvard helped him greatly to earn knowledge in computer science. In fact, his knowledge in this field was the primary reason why he decided to write the Altair BASIC, which was the first step that made a huge impact in his career as an entrepreneur (Didion, 2005). Thompson (1997) also identifies research technical entrepreneurs as those whose previous career or background was focused in an academic environment. This type of environment encourages individuals to more focus on innovating present situation and discovering manifold advances which could lead to more opportunities. Bill Gates' environment in Harvard gained him friends who are interested in computers like him. Beyond doubt, his tenure in Harvard is one of the major contributing factors to his start as a technical entrepreneur. Another factor that proves that Bill Gates is a technical entrepreneur is his family intellectual background. Both his parents are engaged in scholarly professions and thus, he grew up in a setting where research is considered as an ordinary part of their life. This resembles another characteristic of research technical entrepreneurs. Houghton (2003) cites that research technical entrepreneurs are those who grew up in an academic atmosphere. Influential factors in the creation of the business Bill Gates was able to create this business as a result of a number of factors. First of all, the fact that he was born into a relatively wealth family meant that Bill Gates could be afforded the opportunities that were not available to most individuals at that time. For instance, he was educated as the most prestigious schools, one of which exposed the young Bill Gates to computers, which were virtually unheard of at that time for the average citizen. When he left schools and started university, Bill Gates founded a company which gave him the experience in the software environment and enabled him to develop his skills in the field of software programming. A chance publication in a journal propelled Bill Gates to capitalise on a one-off opportunity to showcase his software products. This paid off as it got him recognised and gained his software the exposure it required. This ultimately led to a deal with the sponsor organisation which provided Bill Gates with the capital required to start Microsoft. He later consolidated the Microsoft Empire by forging support from partners and business allies through the advocating of closed source programming and by capitalising on another opportunity by IBM to penetrate the market. Using factors affecting new venture formation by a technical entrepreneur by Tidd et al (2001), there are several antecedent factors, parental experience and institutional support that contributed greatly to the creation of Microsoft. Antecedent factors Bill Gates' personality resembles that of an ideal technical entrepreneur. Tidd et al cited that the three personal characteristics a technical entrepreneur should possess are being a high achiever, independence, and control orientation. Apparently, the first characteristic is proven as his profile reveals that Bill Gates excelled in mathematics and science since he was in elementary school. His independence is shown by his decision to take a path in computer science than following his parents' professions. He did not rely on his parents for support when he was co-writing the Altair BASIC for the Altair 8800. Although he is cited by many scholars as a weak entrepreneur in control orientation (Schiavone, 2004), he was able to build up a company and manipulate its growth. In addition to his personal characteristics, he also gains continual support from his spouse, Melinda French Gates (Microsoft 2006). His spouse even encouraged him to build a foundation for less fortunate citizens and research programmes for computer scientists. Moreover, his background as a highly educated son of professional parents played a great part in his success. Though he dropped out of Harvard during his third year to pursue a career in software development, this does not judge his educational background. His tenure in prestigious schools significantly oriented him to computers. Hence, the fact that his high education is a huge factor to the creation of Microsoft is beyond doubt. Parental experience Ever since Bill Gates' tenure at Harvard, the university was known as the most competitive school in the United States. Thus, his environment was filled with frustration, which led him to be goal-oriented and achieve new heights in computer science. This provided him enough experience that he was able to use as an entrepreneur several years after. His career as a co-writer of Altair BASIC and an enthusiast in software and applications development gained him ideas on how to put up his own enterprise. He also gained institutional support from his parents who supported him in pursuing a career in computer science. Despite the fact that his father wanted him to be a lawyer (Peerman, 1999), he was still supported by him. Environmental factors During the creation of Microsoft Corporation, computers were still unheard by few citizens. Only business professionals and high-ranking individuals are familiar with computers. Hence, the technology was not yet sufficient for other entrepreneurs to start an enterprise in software and application development. With the help of his colleagues in Harvard, he was able to gain access from such technology. The high standard of education of his university gained him enough education to merge business with his interest, computer science. Because most were still unfamiliar with computers, Microsoft became a success as people were fascinated with the programs that computers can execute. This provided the company a huge market for computers. Also, because Microsoft's launch was in time with the world's computer revolution, the company was able to update the consumers with the innovations in computer science. Institutional support in setting up and developing the business venture Bill Gates did not get or seek direct government or institutional support for his business venture. Instead, he relied on capitalizing on different opportunities he received. Nonetheless, by co-writing the Altair BASIC for the Altair 8800 with Paul Allen and Monte Davidoff during his second year in Harvard, Bill Gates gained the experience of a career in the field of software programming language which would revolutionise the operating platform for personal computers. By giving him the opportunity to write software for their systems, Altair indeed indirectly supported Bill Gates in building a career as a technical entrepreneur. Theoretically, Altair provided Bill Gates with the perfect skill, and this led to Bill Gates securing a deal with MITS. Prior to this, as a student in a prestigious university, Bill Gates had sold traffic flow data systems to state governments. Such experience in computer science equipped him with ample knowledge of marketing and communication in these departments. By buying his systems, the state governments demonstrate trust, support and loyalty by believing in his product, which ultimately built up his confidence. Like Altair, the state governments who patronized his traffic flow data systems circuitously provided Bill Gates the morale to engage his career in computer science. This was a similar case with the payroll system he created for a company in Oregon. This gave the Bill Gates confidence, as he now knew he was capable of developing a product that the market desired. All this experience paid off for Bill Gates, and this was demonstrated when IBM contacted him regarding an operating system. Whilst Bill Gates did not have a system ready, he did suggest that they contact Digital Research. However, failure to get hold of a contact at Digital Research, made IBM return to Bill Gates with a request for an operating system, which he responded to promptly by developing QDOS. The success of this system led to copycat versions, and instead of being reactive, Bill Gates was reactive and developed and patented MS-DOS which was operational on all personal computers and not just IBM personal computers. Furthermore, different companies like IBM gave Bill Gates support by partnering with Microsoft, which is just new in the industry at that time. When IBM decided to build the hardware for a desktop personal computer in 1980, it needed to find an operating system, which Microsoft did not have at that moment. The most popular operating system at that time was CP/M developed by Digital Research which allowed software written on the Intel 8080/Zilog Z80 family of microprocessors to run on many different models of computer from many different manufacturers (Resler, 1996). This device-independence feature was essential for the formation of the consumer software industry. IBM had contacted Bill Gates, however they were referred to the founder of Digital Research, but IBM failed to make contact and went back to Bill Gates who offered to fill their need by licensing a CP/M compatible operating system called QDOS (Quick and Dirty Operating System) from Seattle Computer Products for $56 000 and IBM shipped it as PC-DOS (Resler, 1996). The market was then flooded with IBM PC clones and Microsoft was quick to license DOS to other manufacturers calling it MS-DOS for Microsoft Disk Operating System. By marketing MS-DOS aggressively to manufacturers of IBM PC clones, Microsoft went from being small player to one of the major software vendors in the home computer industry and continued to develop operating systems as well as software applications (Resler, 1996). In the 1980s they created Microsoft Windows and the first versions of the Windows operating system did not sell too well as stand-alone applications but started to be shipped pre-installed on many systems reducing the incentive of users to buy competing products regardless of the quality (Resleer, 1996). As a result of this Windows had started to make headway into the IBM compatible software market, and this was demonstrated by the release of Windows 3.0 in 1990 which sold around 10 million copies in the first two years, cementing Microsoft's dominance in operating systems (Resler, 1996). By ensuring that most computers came with their software pre-installed, Microsoft went on to become the largest software company in the world. Therefore to summarise, Bill Gates did get institutional support in terms of exposure and experience, as this exposed him to opportunities that probably would have been overlooked. Reference List Audia, P. G. (2005) Entrepreneurs as organization products: revisted. Walter A Hass School of Business, California: University of California. Didion, T. (2005) Successful entrepreneurs. New York, NY: OFM Publishing. Houghton, C. (2003) Technical entrepreneurs of the 21st century. Carson City, Nevada: Yellow Apple. Marcus, E. (2006) Bill Gates Net Worth Page. [online]. Available from: [Accessed 6 May 2006] McSheriff, S. (2002) Bill Gates: a social creature Ontario, Canada: Lighthouse. Microsoft Corporation. (2006) Microsoft corporation [online]. Available from: . [Accessed on 06 May 2006] Murdock, A. (1998) Biographies of money. Burlington, Vermont: Kirst French. Peerman, J. (1999) Learn from the experts. San Francisco, California: Mayhold. Resler, P. (1996) Entrepreneurship. Poultney, Vermont: Smoothson. Thompson, J L. (1997) Strategic Management 3rd Edition. London: Thomson Business Press. Tidd, J., Bessant, J., Bessant, J. R., Bessant, J. R., Pavitt, K., Tidd, J. (2001). Managing Innovation: Integrating Technological, Market and Organizational Change. 2nd edition. John Wiley and Sons. Read More