The Accidental Zillionaire: Demystifying Paul Allen

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Buried deep in the magazine was an ad for a new product called the Intel This could change everything. This combination could make all kinds of things more efficient, and ultimately reduce the size of the mammoth computers of the day.

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He quickly telephoned Gates back in Seattle and explained what a big deal this was. It could only handle a small amount of characters. Since it was originally designed for the booming calculator market of the day, though, that kind of power was plenty. But Allen and some others in the computer industry saw that over time and with improvements, the chip would easily be able to do more than just serve calculators.

Allen and Gates talked over the implications of better microprocessors. What would it mean for IBM? P aul Allen was off to college and for a while, it looked like he was the one leaving the other behind. Kolde was no gear-head like Allen, but he was keen on business.

Over late-night orders of pizza, the two bonded as they discussed business ideas and played games of chess a favorite with Gates, too. After a while, they became brothers in the fraternity Phi Kappa Theta. He was having experiences beyond business and computers. This lawn could only be mowed with the help of two people, one to push the mower across and the other to stand at the top of the hill and hold one end of a string that was attached to the mower to keep it from tipping over.

The house itself was obscure—literally. It sat so far back on the lot it was easy to miss. Though no one knew it then, Phi Kappa Theta was coming to the end of its year run at Washington State University, which lost the chapter in As a student at Washington State, Allen was no more of a scholar than he had been before, but at least now, he had more control over the classes he took. He packed his schedule with computer classes and spent hours in the Johnson Hall computer center.

He kept in touch with Gates by phone to find out what was going on. B ill Gates had entered his junior year of high school looking for a new project for himself alone or the remaining members of the Lakeside Programmers Group basically, himself and Kent Evans. Before long, he got going on a project analyzing traffic patterns. It was a slow, tedious process and he recruited other Lakeside students to help him get the job done.

But in the spring, a new, more prestigious project landed on the doorstep of the Lakeside Programmers Group. Nicholas and faced a potential class-scheduling nightmare. Administrators asked some of the computer-savvy teachers to come up with a computer program to handle scheduling.

But when the teacher in charge died suddenly in a plane crash, the school looked elsewhere for help. Gates and Evans stepped right up. A week after they got the project, Evans was killed on his ill-fated mountaineering trip.

Their bond was rekindled, this time, nearly for good. A llen came back to Seattle, worked with Gates on the grueling scheduling project and then reluctantly returned to college in the fall. By now, the two had grown closer than ever. For Gates, Allen may have filled two friendships: the one they already had, and the one he lost in Evans. Over the scheduling project, their minds raced through other things they could do together.

Paul Allen, Microsoft co-founder, dies at 65

Allen wanted to get started right away, but his parents insisted he go back to school. From college, Allen began to rack up huge phone bills making long-distance calls to Gates in Seattle. Gates told Allen about his project analyzing traffic data. He complained about how cumbersome it was and how there must be a better way to do it.

The new thing was the Intel , which could handle the entire alphabet, and more. Allen insisted they build a computer before someone else built one first. Presto, they would have an automatic traffic analyzer. This made perfect sense to the business-minded Gates. They christened their new business Traf-O-Data.

Traf-O-Data was many things, but a portent of things to come it was not. Allen and Gates went on to create one of the most successful companies in the world, but as their first business try showed, success was never guaranteed. T raf-O-Data moved quickly at first.


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Allen, Gates, and Gilbert worked around the clock through the fall of After a week, they headed home to spend the holidays with their families. About that time, they landed a little reprieve from their startup work. A job referral had come in for a new project at the tech firm TRW. TRW was about to create a power-management system for the Bonneville Power Administration to control the flow of water and electricity to its customers.

The company was short of hands and was tapping all the sources it had, including a couple of kids named Allen and Gates. While they worked, they continued to discuss where technology was going and what they could do about it. Allen kept tabs on the computer industry through the magazines he read. The potential of these things boggled his mind. For now, he was putting a few precious bucks into his lunch. With all these ideas and all this experience he was gaining, Allen was ready to work, but not without Gates.

He begrudgingly went back for a full year of college. Gates, meanwhile, found he was happy at Harvard, so he suggested Allen join him at the end of the school year. He even arranged a job for him at Honeywell, near Boston. In the summer of , Allen got in his car and headed across the country, leaving behind a college education for good. He had no idea how good. T raf-O-Data never happened the way Allen and Gates hoped it would. When they started out, they really thought they were on to something big.

After all, they knew there was a market for traffic-analysis. Many companies provided traffic-analysis services to municipalities, but they often did it by hand. This was both slow and expensive. Dispirited, Gates and Allen moved on, but they retained legal ownership, leaving the company in the hands of Paul Gilbert for the next 10 years until it finally disappeared. For the future Microsoft duo, it became a lesson in how things could go wrong.

Microsoft co-founder Paul Allen’s impact in Seattle

I n Boston, Allen dutifully fulfilled his job at Honeywell, where he worked on small- and medium-sized computers. Here, there were no envelopes being pushed; it was simply a grind. Gates was developing new relationships at school, playing a lot of poker, and occasionally attending classes. He found many people to goad, just like in high school.

At Harvard, however, these people argued back, especially when he was talking about his silly ideas of how computers were going to become ubiquitous and connected. Allen and Gates argued, too. Over the years, their arguments became legendary. Allen was a good match for Gates, who often wore people down. Sometimes these two raised their voices together in pitch; other times, Allen drove Gates crazy with his stubborn perseverance. They continued to talk about Traf-O-Data and considered themselves full-time principals of the company.

The Accidental Zillionaire: Demystifying Paul Allen

One thing they had absolutely ruled out was building computers from the ground up. The Traf-O-Data experience had been one sorry lesson that building computers was not their strong point. They were better at the things that made the computers run and made them useful. Allen and Gates were programmers. Allen continued to report to Gates what he read in his magazines. He was still expecting a computer built around the Intel chip to hit the market any day.

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When that day came, it sent Allen into a near panic. What transpired next has become an often-repeated tale shrouded in folklore. This time when he showed Gates a story from a magazine that got him excited, Allen had less trouble convincing him they had to act fast. Now, they both believed they were getting left behind.

But what could they do? The article explained that the Altair was small enough to sit on a desktop and was built around the Intel , a new chip generations better than the that could handle loads more memory and new ways to manipulate data. It made sense to them to work on rigging it for this new machine.

Gates was just as excited as Allen, but it took them a few days before they did anything about it.

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