Hard Drive: Bill Gates and the Making of the Microsoft Empire (2 page)

CHAPTER 1

The Early Years

_T

he earth fell away, and the city spread out beneath the

sandy-haired, 11-year-old boy, as the elevator hurried

higher and higher into the last light of a beautiful fall day. Glass windows on the tallest downtown buildings caught what was left of the sunlight and tossed back hues of crimson and gold. Far below to the west a ferry boat glided across Elliott Bay, with the rugged Olympic Mountains in the distance beyond.

Though there was a strong breeze blowing across the Sound, from this height
the
cold, dark waters looked like smoked glass, and the only sign that the ferry was moving was the lighter- colored green water left behind in its wake.

The thin, gawky boy squeezed past the elbows and legs of the adults and other kids around him until he could stand unobstructed against the glass side of the elevator for a better view.

“Welcome to the Space Needle,” the elevator operator intoned. “You are in the west elevator travelling at ten miles per hour, or 800 feet per minute. The Space Needle was built as part of the 1962 World’s Fair, known as the Century 21 Exposition.
...”

But Bill Gates heard none of this. His thoughts were 3,000 miles away, blasting off from Cape Canaveral in a rocket ship of his imagination, fueled by the stories of Edgar Rice Burroughs and Isaac Asimov and a dozen other science fiction writers who had carried him on so many voyages of fantasy and discovery.

Forty seconds after liftoff, the view and the daydream were over as the elevator slipped into its berth at the Space Needle Restaurant 600 feet above Seattle. The dinner at the Space Needle was part of the Reverend Dale Turner’s annual treat for all those who had accepted and met his yearly challenge. And in 1966, none had done it better than Trey, as Bill Gates was called.

The evening marked a tradition going back to Reverend Turner s teaching days at the University of Kansas in Lawrence. At the beginning of each school year, he would challenge his students to memorize chapters 5, 6, and 7 of the Book of Matthew, which are better known as the Sermon on the Mount. Turner had left Lawrence in 1958 and was now pastor of the University Congregational Church in Seattle’s University District, across the street from the University of Washington. Founded nine years before the turn of the century, the church is one of the oldest in the city.

The Gates family were regulars in the congregation, and Bill Gates was enrolled in Turner’s confirmation class. One Sunday morning, Turner threw down his yearly challenge to the class—he would buy dinner at the Space Needle Restaurant for anyone who memorized the Sermon on the Mount. It was the same challenge he made to the full congregation.

The Sermon on the Mount is a difficult passage to put to memory. The words do not rhyme, the sentence structure is disjointed, and it is very long—the equivalent of nearly four standard newspaper columns of type.

Twenty-five years later Turner can still remember the afternoon he sat down with Gates in the living room of the Gates’ home, to hear him recite the passage.

“And seeing the multitudes,” the young boy began, “He went up onto a mountain, and when He was set, His disciples came unto Him, and He opened his mouth, and taught them, saying:

“Blessed are the poor . . .

“Blessed are the meek ...

“Blessed are the merciful
...”

Listening to Gates, Turner was astounded. No one, in all his years in the ministry, had been able to make it through the entire passage without stumbling over at least a few words or lines. But Gates had recited the passage nonstop from the beginning, never missing a line.

“I needed only to go to his home that day to know that he was something special,” Turner later recalled. “I couldn’t imagine how an 11-year-old boy could have a mind like that. And my subsequent questioning of him revealed a deep understanding of the passage.”

Thirty-one others from the University Congregational Church that year stuttered and stammered their way through the passage, and in the fall Reverend Turner took his 32 disciples to the plush, revolving restaurant on top of the Space Needle.

At dinner that night, “Trey” Gates feasted his eyes on the region where he would later make his mark. To the northeast was the University of Washington and the nearby residential district of Laurelhurst, where the Gates family lived, along the shores of Lake Washington. To the south, the Seattle waterfront jutted into the Sound, with its ships, piers, seafood restaurants, and curiosity shops. To the southeast rose the skyscrapers of the city, with 14,410-foot Mt. Rainier looming like a sentinel in the distance. To the east, against the backdrop of the Cascade Mountain range on the horizon, were the suburbs of Bellevue and Redmond, where 13 years later Gates would build his computer software empire.

That evening, as Gates looked out on the city, the suburbs, the mountains, and the waters of the Sound, he was oblivious to his destiny slowly revolving around him. Although he had memorized the Sermon on the Mount and received his free

Space Needle dinner, the boy would never become a regular in the church. He would soon find himself spending most of his free time immersed in the exciting new world of computers. He and Turner, however, would remain friends in the coming years.

“He loved challenges,” Turner said, remembering his bright charge. Even though a Space Needle meal was enticing back then, a lot of kids, on hearing my challenge, weren’t ready to pay the price. Trey was.”

As Gates had told the pastor that day in his house, “I can do anything I put my mind to.”

If bloodlines are an indication of future success, then Bill Gates was born into a family generous with its gifts.

His great-grandfather on his mother’s side of the family, J.W. Maxwell, was a nationally prominent banker. Born on an Iowa farm in the nineteenth century, he decided to seek his fortune behind a bank teller window rather than toil in poverty behind a plowshare. He left home for Lincoln, Nebraska, at age 19—the same age at which his great-grandson would found Microsoft nearly a century later—to begin a career in banking. In Lincoln, he became good friends with William Jennings Bryan, the orator and politician, and John J. Pershing, who would command the nation’s armies during World War I.

In 1892, heeding the advice of editor and political leader Horace Greeley, Maxwell headed west with his wife to the town of South Bend in Washington State. There he continued his banking career, was elected mayor, and served in the state legislature. The family moved to Seattle in 1906, where Maxwell founded National City Bank and gained a national reputation in the banking industry.

Maxwell’s son, James Willard Maxwell, began his own banking career in 1925 as a messenger in his father’s bank after graduating from the University of Washington. At the university

he met his future wife, Adelle Thompson, a smart, spirited, athletic woman from Enumclaw, a hamlet nestled in the foothills of the Cascade Mountains southeast of Seattle. She had been a star forward on the women’s high school basketball team and class valedictorian.

The younger Maxwells became one of Seattle’s most socially prominent families, active in numerous community organizations, including United Good Neighbors, the predecessor of United Way. Willard Maxwell enjoyed both wealth and power in Seattle, eventually becoming vice president of Pacific National Bank (which later became First Interstate, the nation’s ninth largest bank). Several decades later they would leave their grandson a million dollar trust fund. Despite their wealth, the Maxwells disdained ostentation, a trait that has been passed down through the family.

Their daughter Mary was born in Seattle in 1929. A vivacious young beauty she grew up among some of the most prominent families in the Northwest. Like her mother before her, Mary Maxwell met her future husband, a tall, athletic, prelaw student by the name of Bill Gates, Jr., while she was a co-ed at the University of Washington. A school cheerleader, Mary was as outgoing and gregarious as Bill was shy and reserved. A mutual friend, Brock Adams, had introduced the couple while Adams was student body president, and Mary was an officer in the student government association. (Adams went on to a career in politics, serving as secretary of transportation under President Jimmy Carter. He is currently one of Washington’s U.S. senators and remains a close friend of the Gates family.)

While Bill Gates, Jr., did not have the wealthy and prominent family background of his wife, he did have the same dnve and ambition. He was born in Bremerton, Washington, an hour’s ferry ride from Seattle, where his father owned a furniture store. Upon graduation from high school in 1943, Gates enlisted in the Army. By the end of World War II two years later, he was enrolled in officers’ training school at Fort Benning, Georgia.

Discharged in 1946 as a first lieutenant, he promptly enrolled at the University of Washington, where he became the first member of his family to graduate from college.

After getting a law degree from the university in 1950, Gates returned to Bremerton as assistant city attorney. Mary Maxwell, a couple years behind him in college, graduated in 1952, and they married shortly afterward. But a Navy homeport like Bremerton, with its ubiquitous sailors, fast-food restaurants, and tattoo parlors, was not the place to climb social or legal ladders, so the couple moved to Seattle, where Mary taught school and Gates went into private practice, eventually becoming a partner in the firm of Shidler, McBroom, Gates & Lucas.

In 1954, Mary Gates gave birth to a daughter, Kristi. A year later, she gave birth to their only son.

William Henry Gates III was born on October 28, 1955, shortly after 9:00
p
.
m
.
His parents nicknamed him “Trey,” reflecting the III after his name. The moniker stuck—no one in the family ever called him anything else. He was born under the sign of Scorpio, and the traits ascribed to his astrological sign would prove eerily correct: aggressive and stimulated by conflict; prone to change moods quickly; a dominating personality with outstanding powers of leadership. Scorpios are known for having the respect, rather than the affection, of others, according to the World Book Encyclopedia. Trey Gates read the encyclopedia, from beginning to end, when he was only seven or eight years old.

Trey was an unusually energetic child, even as a baby. He learned to make the cradle rock on his own and would rock incessantly for hours at a time. When he was old enough, his parents bought him a rocking horse, which was akin to feeding sweets to a hyperactive kid. Even today, his rocking habit is legendary in the computer industry, as much of a signature of the man as Arnold Palmer hitching up his pants as he strolls down the fairway or Michael Jordan sticking out his tongue as he drives for a basket. It has become part of the corporate culture at Microsoft among programmers trying to re-create themselves in the chairman’s image. Gates often rocks himself in a chair, elbows on knees, to contain his intensity, especially when the talk is about computers; it’s not unusual to walk into a room of Microsoft managers and find most of them rocking in sync with him during an important meeting.

His rocking addiction notwithstanding, Trey Gates had a fairly typical childhood. After her son was born, Mary Gates gave up teaching to raise the family while her husband established his legal practice. As an alternative to teaching, she followed her mother’s lead and became a community volunteer. One of her first volunteer jobs, working on behalf of Seattle’s Museum of History and Development, involved going to area schools and giving short talks on the region’s culture and history. Trey, who was only three or four years old, would accompany his mother and sit on the desk in front of the class while she showed museum items to the students.

A recent book,
The Making of Microsoft
by Daniel Ichbiah and Susan Knepper, gave short shrift to what the authors described as Gates’ “uneventful” childhood, other than to leave the impression he was a deeply introspective child who stayed in his room most of the time in intense, reflective thought. Gates was certainly an introspective child, but he hardly grew up like a hermit in his room. For one thing, it is unlikely even Gates could have tolerated being cooped up for long periods of time in his room—it was usually in a state of chaos. His parents couldn’t train him to pick up his clothes. Eventually they tried taking his clothes away from him. When even that didn’t work, they finally gave up, requesting that he at least keep the door to his room closed so no one else would have to look at the mess.

Mary Gates, in describing her son, has said that he has pretty much done what he wanted since the age of eight. Trey’s closest childhood friend was Carl Edmark, whom Gates met in the fourth grade. Edmark said of him “He was very eccentric even back then.” The two went to elementary school together, graduated from high school together, and continued to be good friends for years afterward. Their families were also good friends; Edmark’s father was a prominent Seattle heart surgeon who had invented a defibrillator that corrected abnormal heart rhythms during surgery.

Even as a child Gates had an obsessive personality and a compulsive need to be the best. “Any school assignment, be it playing a musical instrument or writing papers, whatever, he would do at any or all hours of the day.” said Edmark. What seemed like eccentric behavior to fellow fourth graders, however, was likely nothing more than his competitive spirit. One of the first major assignments in his fourth grade class was to write a four or five page report on a particular part of the human body. Gates wrote more than 30 pages. Later, the class was told to write a short story of no more than two pages. Trey’s story was five times that length.

“Everything Bill did, he did to the max,” said Edmark. “What he did always went well, well beyond everyone else.”

Gifted children—those with IQs near or above the genius level—sometimes grow up to be socially inept, due to limited childhood interactions and experiences. Bill and Mary Gates were determined to see that that didn’t happen to their son. They tried to expose him to as many opportunities and experiences as possible. When he was old enough, he was encouraged to join Troop 186 of the Boy Scouts. His father had been an Eagle Scout as a youth, and understood the value of Boy Scout activities and camaraderie. The troop met at an elementary school not far from the Gates’ neighborhood. Trey stayed with the Scouts not only because he liked the outdoors, but because being a Scout fulfilled a need.

“His father was an attorney and very busy, and Bill needed a lot of companionship, which he got from the other boys,” recalled Scoutmaster Don Van Wieringen.

One year during a Boy Scout jamboree—where Scouts from around the state gather to show off knot tying and fire building skills—Gates and a friend rounded up computer equipment and set up a hands-on demonstration of what a computer could do. At that time, few of the boys had even heard of a computer, much less used one. Today, thanks in part to Gates’ software systems, computing can earn Scouts a merit badge.

Unlike some Scout troops, which cared more about selling light bulbs and candy at Christmas, Troop 186 made year round efforts to hike and camp in the woods.

On one 50-mile summer hike, Gates demonstrated the persistence and tenacity that was to be his trademark later in life. Gates showed up for the week-long hike in a new pair of hiking boots that were not suited for hiking eight miles a day. By the end of the first day, his heels had been rubbed raw and his toes badly blistered. By the end of the second day, his feet were raw and bleeding openly. One of the adults on the trip, who was a doctor, gave him some codeine for the pain. The next day some of the Scouts carried his equipment, and Trey continued on, limping along until he reached the halfway checkpoint on day four, where hikers could bail out in an emergency. At that point, he could no longer walk. His mother had to be called in Seattle to come get him. One of the adults on the hike recalled that when she arrived, Mary Gates was not a happy camper. “She was busy being a socialite,” he said, “and thought Bill was taken care of for the week.”

Mary’s passion for education fueled a desire to return to teaching, but her career plans changed with the birth of a second daughter, Libby, nine years after Trey. Instead, she continued with her volunteer public service, which led to a seat on the boards of several of the Northwest’s largest corporations, including First Interstate Bank and Pacific Northwest Bell. Mary

Gates was a quick study with a strong will, incisive intelligence and good business instincts.

“The driving force in the family has always been Mary Gates,” one friend observed. “She seemed to tie everything together with the family. Mary was the smart one, Bill, Jr., was the shy one.”

Despite her volunteer activities and community involvement that kept her busy, Mary Gates was a devoted mother. She also loved to socialize, and she and her husband threw frequent parties for their friends, who included many of Seattle’s wealthiest and most powerful individuals. A charming, gracious host, warm and outgoing, she could nonetheless be quite assertive, with a steely gaze and a firm handshake.

She is very much the kind of person who sizes you up, makes quick conversation and moves along, exiting gracefully but
forcefully
,” a business friend said.

As successful as the gregarious Mary Gates was in Seattle’s community, the quieter Bill, Jr., also became a respected figure. His legal career was furthered by his relationship through marriage to the Maxwells. He was active in the bar, eventually serving as president of the Washington State Bar Association, and chairing several American Bar Association commissions. In 1966, he became a senior partner in
the law firm of Shidler, McBroom, Gates & Lucas, a firm rooted in Republican politics.

My sense is that Bill, Jr., always wanted to position himself to exert quiet control in the law firm, and Mary was more inclined to pull public strings and press the switches,” said one Seattle attorney who knows the family.

Both Mary and Bill, Jr., became active in Republican party circles as well, although they kept in the political shadows and out of the public eye. In 1973, Governor Evans, a family friend, quietly pushed to have Gates nominated to a federal judgeship in Seattle. But the state’s two U.S. senators at the time, Henry “Scoop” Jackson and Warren Magnuson, both Democrats, preferred a local attorney with more liberal leanings to fill the vacancy on the federal bench.