Today in History - July 22, 1975 - Bill Gates and Paul Allen sign Microsoft’s first official contract licensing their BASIC to MITS, the makers of the Altair kit computer. The young entrepreneurs had hit upon a revolutionary new concept—the idea that a company could make money selling software for microcomputers. As Bill puts it in his oral history “Well, we knew that MITS was only one company, and we wanted our software to be used on all the machines. And even the original deal we did with MITS talked about our ability to get paid for licenses to other companies.” Here is a snippet of the actual contract, which backdated the agreement to March 1st of that year:
Back in April, Alice and I discussed the founding date issue. It is absolutely obvious that Microsoft started out in 1975. It is absolutely impossible to pick a specific date within that year as “the” date. Imagine yourself as a 19-year-old, with your 22-year-old friend, starting out in a new business venture. You haven’t hired a venture fund manager, or a PR firm, and your sister ends up doing your tax forms for the year. You see a magazine article which sparks an idea for a product. You make an oral agreement with a company to deliver that product, and you give it to them when it’s done. A couple of months later it gets written up in a newsletter or two. Somebody likes your new product enough to lift a copy of your paper tape out of your marketing van and starts passing out copies. Eventually, you write up a formal agreement, and then backdate it. Meanwhile, you’re working out of your apartment, and hiring friends to contract part-time. I don’t think the average person would think, “In 33 years this new company will have revenues topping $60 billion, and I should probably make a note that the company started today.”
We did find an outdated Microsoft Fast Facts document that gave the April 4th date, so it’s very possible that the wrong information originated with us. To me this just illustrates the fact that history is only an interpretation of what we perceive from the documentary evidence, and that archives are hugely important in making sure that evidence is available to be re-examined with fresh perspective when the need arises.
For more information on the early years, you’ll find some great new material on the Bill Gates Transition site on Microsoft PressPass, including the reunion shot of the original employees from the classic “Albuquerque Group” photo.