This Day in Tech History

On This Day . . .

From $16,005.00 to Billions

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April 4, 1975:  Happy Anniversary Microsoft

Paul Allen and Bill Gates found Microsoft in Albuquerque, NM. The company was founded there simply because that is where Micro Instrumentation and Telemetry Systems (MITS) is located. The duo was building BASIC for the Altair 8800.


Paul Allen and Bill Gates, childhood friends

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with a passion in computer programming, were seeking to make a successful business utilizing their shared skills. In 1972 they founded their first company named Traf-O-Data, that offered a rudimentary computer which tracked and analyzed automobile traffic data. Allen went on to pursue a degree in computer science at the University of Washington, later dropping out of school to work at Honeywell.  Gates began studies at Harvard.

The January 1975 issue of Popular Electronics featured Micro Instrumentation and Telemetry Systems’s (MITS) Altair 8800 microcomputer. The MITS Altair, was the first “personal computer,” a build-it-yourself kit for hobbyists.  Bill Gates and Paul Allen seized the opportunity to transform this early PC into a breakthrough — the Altair needed software, a programming language that could make it perform useful computing tasks. That’s when it all began.

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Allen noticed that they could program a BASIC interpreter for the device; after a call from Gates claiming to have a working interpreter, MITS requested a demonstration. Since they didn’t actually have one, Allen worked on a simulator for the Altair while Gates developed the interpreter.  Although they developed the interpreter on a simulator and not the actual device, the interpreter worked flawlessly when they demonstrated the interpreter to MITS in Albuquerque, New Mexico in March 1975;  MITS agreed to distribute it, marketing it as Altair BASIC.

They officially established Microsoft on April 4, 1975, with Gates as the CEO. Allen came up with the original name of “Micro-Soft,” the combination of the words microcomputer and software, as recounted in a 1995 Fortune magazine article. In August 1977 the company formed an agreement with ASCII Magazine in Japan, resulting in its first international office, “ASCII Microsoft”. The company moved to a new home in Bellevue, Washington in January 1979.

A 1978 photo of early Microsoft employees

A 1978 photo of early Microsoft employees

1975 Summary

  • Revenues: $16,005
  • Employees: 3 (Allen, Gates and Ric Weiland)
  • MITS promotes Altair BASIC, the computer language developed by Gates and Allen for the Altair computer. Hobbyists are ecstatic, despite the fact that, even with BASIC, there is little you can actually do with the Altair.
  • The MITS Altair 8800 appears on the cover of Popular Electronics. The article inspires Paul Allen and Bill Gates to develop a BASIC Interpreter for the Altair.
  • Bill Gates and Paul Allen complete BASIC and license it to their first customer, MITS of Albuquerque, N.M., the manufacturer of the Altair 8800 personal computer. This is the first computer language program written for a personal computer.
  • Paul Allen joins MITS as director of Software Development.
  • The MITS Altair newsletter, Computer Notes, declares, “Altair BASIC — Up and Running.”
  • Gates and Allen’s BASIC officially ships as version 2.0 in both 4K and 8K editions.
  • Allen and Gates sign a licensing agreement with MITS regarding the BASIC Interpreter.
  • In a letter to Allen, Gates uses the name “Micro-Soft” to refer to their partnership.

Bill Gates on Microsoft History


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