Interesting article but I'm not sure some of the statements chime with how things looked at the time (IME ofc).
I got involved in IT as a profession in 1995 and even then Lotus 1-2-3 and Wordperfect were going pretty well, so the idea stated in the article that :-
"a monopoly in operating systems and office suites was inevitable before 1990 was over."
seems a little overdone.
My memory of what really tipped it for Microsoft in the office suite market (at least in the UK) was that they started giving away a full office suite with every new PC. So even though competitors might have better functionality, it was a tough sell to get past the price of "free".
Definitely in the SMEs I worked in this was the reason that Office became the defacto option for office applications.
I started my career in '95, too, and yeah, as difficult as it is to believe now, Microsoft's monopoly wasn't yet assured. The OS market was pretty much locked up (OS/2 Warp???), but as I recall, Wordperfect was the big obstacle in the office-suite space. It had a massive userbase, especially in markets that were not friendly to change (law offices).
IMHO, the big boost for Microsoft was when they adopted the Lotus 1-2-3 and Wordperfect file formats. Now there was a product that costs less (free, with a new PC), and was compatible with all the existing docs/data. Game over.
Os/2 warp was miles ahead of windows 95 technically. The main issue was that it was also a bit too ambitious in terms of system requirements which meant that on most systems it was slow as molasses really.
Add that to the Microsoft first mover advantage and it was doomed to fail.
I ran OS/2 v 3 on a machine with 8 megabytes (sic) of RAM quite smoothly. But I had to choose: either I enable TCP/IP networking and disable the Win16 emulator, or the other way around. If I enabled both, the machine started to swap to disk too much.
Win95 worked well on such a machine, and even worked tolerably on machines with 4 MB RAM, which were still around. It lacked the nice true multitasking, because it was basically running on a DOS extender, like most large DOS games. But you could run win32 programs, win16 programs, DOS programs, and have TCP/IP and thus access the Internet all at the same time. It was a killer combination. Also, it had a really thought-out GUI, a big upgrade compared to Win 3.1. (Far from the coolness of OS/2 WPS, but...)
Yeah that's the thing, OS/2 really was way better (at least when Warp came around because the earlier versions were really mediocre). It was really IBM's last try to revert the mistake they had made with Microsoft back in the early days of the IBM PC. They failed to see its potential.
The desktop really reminded me of HP/Apollo's VUE (which later got turned into CDE when Sun and IBM joined the project). Especially due to the large "dock".
In my memory (was young at the time), 95 coming out was such a huge event. Something about its emphasis on multimedia experience really changed the whole feel of the PC, at least for me. 3.1 was like this arcane puzzle, but 95 felt personable.
Don’t forget the Rolling Stones Start Me Up was the marketing song. We ‘leet hackers all joked that it was entirely appropriate for “Windoze’s” theme song to include the lyrics “You make a grown man cry.” Those were the days!
Windows 95 was what has started the dominance of Microsoft in office suites, so in 1995 it was too early to see the results.
Until Windows 95, many people were already using Windows, but never exclusively, all serious work was still done using MS-DOS programs and Windows was regarded more as a toy. This has changed with Windows 95, which was the first Windows version that you could use for doing everything you needed on the computer.
The advantage of Microsoft was that the other companies were not able to keep up with it in issuing new versions of their programs for Windows. The Windows versions of Lotus 1-2-3 and Wordperfect have never been as good as their MS-DOS ancestors.
To achieve this, Microsoft has not hesitated to cheat, i.e. the MS Office developers were aware of the next Windows API versions a long time before competitors, so they had much more time to update their programs and the MS Office suite also made frequent use of undocumented Windows APIs that competitors could not use, unless they discovered them by reverse engineering.
The answers at your link explain pretty well what kind of APIs these were and they provide sources, e.g. the several books that have been published under titles like "Undocumented Windows ...". There were no magic APIs, just ordinary functions that covered various features not yet implemented in the publicly available Win32 API.
Keep in mind also that the Windows kernel system calls were never accessible directly, like in Linux or the like, but as an external developer you were at the mercy of the user libraries provided by Microsoft. If the documented user libraries did not cover all the features actually implemented by the operating system, there was no way to use them without reverse engineering.
This is now pretty much ancient history and later such APIs have been documented by Microsoft, e.g. in the "Windows Protocols Specifications", mostly as a consequence of lawsuits and investigations by the European Union and FTC.
However when that happened, around 2000, the damage had already been done and the competition had been eliminated.
The dominance of Microsoft in office suites that has been achieved during the transition from MS-DOS to Windows 95, than Windows 98, has succeeded in good part because of the great increase in the number of computer users during this time.
For newbies, the MS Office suite took very well advantage of the new features enabled by a GUI and MS Office was very easy to use, while the Windows versions of the older MS-DOS programs, like Lotus 1-2-3 and WordPerfect were much less polished than MS Office, while simultaneously losing their previous keyboard-based user interface, which for experienced users had been much faster at accomplishing any task than any Microsoft GUI.
So the MS Office GUI alternatives were neither easier to use nor faster, therefore not even their former users had any reason to stick with them, while all the newbies were naturally attracted to MS Office.
Moreover, starting with Windows 95, Microsoft has convinced somehow all the hardware peripheral add-on-cards to stop documenting their products, but instead of that deliver them together with only Windows device drivers.
Since that time, the non-Microsoft operating systems had to rely mostly on reverse-engineering for being able to run on modern hardware. Many years later, the situation has improved somewhat, but only for certain classes of peripherals, like network interface cards, where the vendors typically also provide Linux drivers now.
This has hit also the old MS-DOS programs like Lotus 1-2-3, which had tons of drivers for various kinds of now obsolete Super-VGA video cards, so on new computers with Windows 95 or later they had to run in some less performant video mode that was supported directly or through emulation on modern graphic cards, unlike the Windows programs that could take full advantage of the hardware. This has contributed to the obsolescence of the better MS-DOS programs, because even if Windows 95 could run them in Virtual 8086 mode they did not work as well as on the older computers for which the MS-DOS programs had drivers that took advantage of enhanced features.
True, but nothing has changed in the next few years, every new Windows version had APIs that have been either documented publicly later than for internal developers or that have been documented only much later, after several years and during the time when Microsoft was already under investigation.
In the case I dealt with, I was buying new Gateway PCs and they were shipping full Office Pro (including MS Access) for free with the PC.
The company I worked for at the time were pretty cost conscious so there was no way they would buy additional Wordperfect or Lotus 1-2-3 licenses on top of that, even though some of the staff much preferred those products.
I was only starting working with computers as an unpaid IT help at that time, but I distinctly remember that MS Office was just better. More streamlined, and well-integrated.
Back then, pretty much everybody in my country just pirated the software, so the cost was not a consideration at all.
It's worth noting that Microsoft was the first company to sell a complete office suite as a bundle for the PC. Others quickly caught on, but still MS Office was the only suite that had consistent UX across the different programs they were packaging together. Lotus SmartSuite checked all the same boxes on paper, but switching between the different programs feels like tripping on cracks in the sidewalk.
There's an interesting debate there. Here's my thesis on it:
Isolating the definiton of "PC" to the IBM lineage makes it a lot easier to contextualize the historical development of home computing. Example: my TRS-80 is a microcomputer, but it is not a PC. This is a sentence that younger generations can grok. If I say "my TRS-80 is a PC but not an IBM PC-compatible" their eyes glaze over.
The “definition” of PC is “A personal computer (PC) is a microcomputer designed for use by one person at a time.”
In common parlance it has come to mean “a computer running a Microsoft operating system”. Most people these days would consider an Arm based computer running Windows a “PC”.
Back in the day, a word processor or spreadsheet app could cost several hundred dollars each. Buying an office suite was supposed to be cheaper than if you bought the 3 apps in an office suite separately.
Consistency in UX and integration between app in the office suite were other touted advantages.
> Today’s entrepreneurs would do well to note that Microsoft made minimal use of venture capital. Microsoft’s only VC only owned 6.2 percent of the company. Gates didn’t trust them.
While the article touches on it here, Microsoft was able to avoid venture capital because it was highly profitable from its very early days. They turned their first profit in 1975, the same year they were founded.
It seems like more companies spend longer amounts of time being unprofitable and growing. How much of that is a zero interest rate phenomenon or the new normal?
Paul Allen, a high school friend of Bill Gates, read an issue of Popular Electronics. Paul showed Bill the article about a new minicomputer.
They cold-called the New Mexico company to push their non-existent BASIC interpreter. Bill took a leave of absence from Harvard and the microcomputer software business took off with the help of Harvard's computer resources.
That is absolutely true. But his upbringing gave him a near limitless amount of arrows in his quiver. You honestly don't think that was a huge advantage he had?
It's easy to "take a big shot" when you have all the support in the world.
Easier than without support, but not easy. Not everyone born to means goes on to found wildly successful companies.
Environment matters a tremendous amount. In common scientific terms, there is almost nothing that is not environment. DNA, development, parenting, personality can all be framed as environmentally derived.
Sometimes these factors come together to give people huge advantages, both in situation and support, but also talent, knowledge, and personality.
I think the lesson we should take away from this is the importance of good environmental influences in producing good outcomes.
Something I find interesting about early technology IPOs is how early they IPO-ed compared to more recent tech companies and how much of their growth and value creation happened post-IPO.
- Microsoft IPOed in 11years, profitable and at a ~$800M valuation. They hit a ~$1T valuation in 2000. During the 90s, their stock roughly doubled each year, for a 1000x growth.
- Amazon IPOed in ~3 years, unprofitable and at ~$300M valuation. Their stock has 2200x since then.
- Google IPOed in ~6 years, proftiable and at a $25B valuation. Their stock has ~80x since then.
- Facebook IPOed in ~8 years, profitable and at $100B valuation. Their stock has 20x since then.
I think the ZIRP era led many companies to avoid going public, either because of access to easy money or because their financial didn't need to be disciplined enough. The high levels of pre-IPO funding also has led to many/most of them underperforming in the public markets.
Regulatory compliance like Sarbanes Oxley is another huge factor. And VC's having large capital pools make it easy for companies to stay private vastly longer without needing to raise funding from the public.
It's very unfortunate for the public markets, as basic only VC's and PE get access to high growth young companies. Now most of the growth is squeezed out by the VC's and the public gets just the tail end of mature companies.
A lack of IPOs makes the startup life much less attractive than sitting around at a post-IPO company, which also means a harder time growing the startups the VCs are investing in
I guess it also likely not helpful to the VCs to have the public market having real opinions about the valuation that the fees are presumably based on, unless the company is a clear runaway success
There’s some market/observer bias in these numbers; they hit four very different eras of VC and public markets perspectives on tech stocks.
VCs in the Microsoft IPO era would proudly display a tombstone for a $50mm IPO raise. It was a very different time.
Google was the first tech company to really test the bounds and power of Investment banks in the IPO process — they went with some sort of auction type mechanism (if I recall correctly), intended to keep bankers from making “too much” on the IPO, and were roundly snubbed by the sell side arms of those same bankers, resulting in a very low flotation. Which worked out fine for them.
By the time Zuck IPOed, he had enough power and we had enough tech history that he was able to run a MAJOR IPO and retain complete control of the company. And, from a financial perspective, very well deserved.
In each of these four eras, the perceived (and actual I guess) size of the addressable market for a tech company was roughly an order of magnitude larger than the prior, and combined with wealthier VCs from prior rounds, and more pattern recognition about business models, we see more of the value being captured early, out of the public markets.
Yeah but that was their worst moment. Michael Dell joked someone should buy Apple for a few bucks and put them out of their misery.
Of course history went another way but it was pretty close. And really, Steve Jobs wouldn't have been the leader he was without NeXT and Pixar. It was unfair how he got fired by Pepsi guy (Edit: That was John Sculley, I had forgotten his name) but he wasn't ready to lead Apple the size it was at that time. Things just came together at just the right moment.
I have occasionally wondered about that. If Steve Jobs did not get fired by Sculley, would we still have the Apple we do today. I lean towards unlikely. I do think Steve had some growing up to do.
I still hold the theory that the entire success of Apple post-1997 hinged on iTunes for Windows.
iMac and iPod were good products but iPod was stumbling along as a Mac-only product. Letting PC users use iPods opened the cash floodgates and let the iPhone get developed.
> Something I find interesting about early technology IPOs is how early they IPO-ed compared to more recent tech companies
I am unable to resolve this sentence with the list that follows that has Microsoft IPOing significantly later in their life than the three others listed. Microsoft IPO'ed later compared to Amazon, Google, and Facebook.
Yup. Strikes me as obvious that folks figured out how to get in there earlier rather than leave it to the public markets. Just sort of speaks to a combination of market efficiency plus increased regulation in my mind.
Most of people's issues with the Securities Exchange Commission came from changes in corporate behavior that made people notice they had an issue with the Securities Exchange Commission
the SEC's class dividing rules were ignorable when companies were IPOing at low marketcaps
people don't want to only buy companies after all the growth is seemingly done at 50bn-100bn+ marketcaps, while not having access to private markets or low liquidity in private markets
so they pursue things outside of the SEC's protection
Yep. Michael Lewis’s book The New New Thing is a great little window into that timeframe. He claims Jim Clark really wanted a new boat, so Clark forced the IPO on the board to get some liquidity.
Another major moment marking a ‘new market dynamic’ was Microsoft buying Hotmail in 1997 for roughly $400mm? Pretty much unheard of pricing for a web company.
People play up Bill Gates’ connections, sure, but next to no 16-year-olds could program BASIC in assembly.
Microsoft’s success was as much to do with them being a programming languages company first. DOS, Windows 3.1, and even Windows 95 shipped with an interpreter and compiler for their BASIC and C, respectively. This empowered developers to use and write code for the OS out-of-the-box.
Correct regarding the BASIC. MS DOS (and even MSX BASIC and MSX DOS) was pretty important though in the grand scheme of the ecosystem forming.
But neither Windows nor DOS shipped with a C compiler; it's not a Unix. DOS shipped with an IDE for BASIC, and compilers were available but not free. The more accessible option was Turbo Pascal (and then Delphi 1), Visual Basic was also popular but more costly.
GCC appeared in 1987 but only worked acceptably under Unix-like OSes.
Windows 95 and 98 came with QBasic, but it was not installed by default. It was an optional "extra feature" that could be added from your Windows installation media.
I apologize for misreading your post, I thought you asserted that Windows did not come with QBasic. I'm well aware of what QBasic was - it's what I used when I first learned programming. It was an excellent toy for 12yo me.
Hmm yeah Gates was a bit of a programming prodigy sure. But none of Microsoft's success really has anything to do with that. It was all about smart business acumen, starting with the deal made with IBM, being allowed to sell MS-DOS to PC clone makers.
To me, Visual Basic (not Visual Basic .NET) was the game changer for Microsoft. It empowered many power users (user, not programmer) to create software that they couldn’t find on the market.
> Today’s entrepreneurs would do well to note that Microsoft made minimal use of venture capital. Microsoft’s only VC only owned 6.2 percent of the company. Gates didn’t trust them.
> If you’re thinking of trying your hand at being the next Bill Gates, keep that in mind.
Keep what in mind? Sure so try to build a company now w/o VC money and potentially complete with others who have taken that money? Microsoft obviously had an advantage of a completely new industry AND literaly very little VC money (and in vastly tighter amounts) funding competitors.
> [summarized] Amazon didn’t turn a profit until 2003
That was 100% by design. Why make profits when you can grow? Profits are taxed. Reinvesting in growth is generally not taxed, and you are rewarded by the market as it projects out how long your growth could continue and reflects that in your stock price.
To be fair, the idea that you might buy a stock for something other than its likely dividend and that this wouldn’t just be a momentum trade is an idea that was finally cemented somewhere in the dotcom 1/dotcom 2 era. Still.
Why doesn't this apply to Stripe with its 8,500 employees?
> The reason Microsoft had to go public in 1986 was because Bill Gates had been using stock to attract talent. Microsoft projected that by sometime in 1987, they would have 500 shareholders, which would require Microsoft to register with the Securities and Exchange Commission, effectively turning them into a publicly traded company, but without the benefits of going public in the conventional way.
> Backed into this corner, Gates agreed in late 1985 to pursue an IPO.
The limit has been raised to 2,000 shareholders. The company isn't required to go public, but the company does have to file its financial data with the SEC.
There are workarounds. Not sure if Stripe is using any of them, but the gist of it is to create subsidiaries that don't employ more than 2000 people (that's the current limit). So for example you'd have Stripe Engineering Inc., and Stripe Marketing Inc. and so on.
It’s interesting how much of the company Paul Allen owned at the time without being any longer involved with the company. I suspect that in 2025 he would have been bought out or pressured to return equity by that point
Interesting article but I'm not sure some of the statements chime with how things looked at the time (IME ofc).
I got involved in IT as a profession in 1995 and even then Lotus 1-2-3 and Wordperfect were going pretty well, so the idea stated in the article that :-
"a monopoly in operating systems and office suites was inevitable before 1990 was over."
seems a little overdone.
My memory of what really tipped it for Microsoft in the office suite market (at least in the UK) was that they started giving away a full office suite with every new PC. So even though competitors might have better functionality, it was a tough sell to get past the price of "free".
Definitely in the SMEs I worked in this was the reason that Office became the defacto option for office applications.
I started my career in '95, too, and yeah, as difficult as it is to believe now, Microsoft's monopoly wasn't yet assured. The OS market was pretty much locked up (OS/2 Warp???), but as I recall, Wordperfect was the big obstacle in the office-suite space. It had a massive userbase, especially in markets that were not friendly to change (law offices).
IMHO, the big boost for Microsoft was when they adopted the Lotus 1-2-3 and Wordperfect file formats. Now there was a product that costs less (free, with a new PC), and was compatible with all the existing docs/data. Game over.
Os/2 warp was miles ahead of windows 95 technically. The main issue was that it was also a bit too ambitious in terms of system requirements which meant that on most systems it was slow as molasses really.
Add that to the Microsoft first mover advantage and it was doomed to fail.
I ran OS/2 v 3 on a machine with 8 megabytes (sic) of RAM quite smoothly. But I had to choose: either I enable TCP/IP networking and disable the Win16 emulator, or the other way around. If I enabled both, the machine started to swap to disk too much.
Win95 worked well on such a machine, and even worked tolerably on machines with 4 MB RAM, which were still around. It lacked the nice true multitasking, because it was basically running on a DOS extender, like most large DOS games. But you could run win32 programs, win16 programs, DOS programs, and have TCP/IP and thus access the Internet all at the same time. It was a killer combination. Also, it had a really thought-out GUI, a big upgrade compared to Win 3.1. (Far from the coolness of OS/2 WPS, but...)
Yeah that's the thing, OS/2 really was way better (at least when Warp came around because the earlier versions were really mediocre). It was really IBM's last try to revert the mistake they had made with Microsoft back in the early days of the IBM PC. They failed to see its potential.
The desktop really reminded me of HP/Apollo's VUE (which later got turned into CDE when Sun and IBM joined the project). Especially due to the large "dock".
>Os/2 warp was miles ahead of windows 95 technically
Did it run DOOM and Quake? I think that's what decided what OS was gonna succeed.
It did, both in that OS/2 was backwards compatible with DOS, and that the games were ported.
https://doomwiki.org/wiki/OS/2
https://www.os2site.com/sw/games/action/quake/index.html
1995 was the tipping point. Windows 95 came out and WordPerfect was late coming up with a good Windows app.
In my memory (was young at the time), 95 coming out was such a huge event. Something about its emphasis on multimedia experience really changed the whole feel of the PC, at least for me. 3.1 was like this arcane puzzle, but 95 felt personable.
It was a very big deal. It was introduced with the help of Jay Leno.
https://m.youtube.com/watch?v=Dv0PxINy2ds
People lined up for it.
Don’t forget the Rolling Stones Start Me Up was the marketing song. We ‘leet hackers all joked that it was entirely appropriate for “Windoze’s” theme song to include the lyrics “You make a grown man cry.” Those were the days!
Less than four months until Win95/Office95 turns 30.
It also has the line "You make a dead man cum." I always wondered how Microsoft's marketing department let that one pass.
I guess the decisive line was: You make a grown man cry. It is valid, even today, for all Microsoft products.
Windows 95 was what has started the dominance of Microsoft in office suites, so in 1995 it was too early to see the results.
Until Windows 95, many people were already using Windows, but never exclusively, all serious work was still done using MS-DOS programs and Windows was regarded more as a toy. This has changed with Windows 95, which was the first Windows version that you could use for doing everything you needed on the computer.
The advantage of Microsoft was that the other companies were not able to keep up with it in issuing new versions of their programs for Windows. The Windows versions of Lotus 1-2-3 and Wordperfect have never been as good as their MS-DOS ancestors.
To achieve this, Microsoft has not hesitated to cheat, i.e. the MS Office developers were aware of the next Windows API versions a long time before competitors, so they had much more time to update their programs and the MS Office suite also made frequent use of undocumented Windows APIs that competitors could not use, unless they discovered them by reverse engineering.
What are these frequently used undocumented Windows APIs that MS Office uses?
This retrocomputing stackexchange answer doesn't list any - https://retrocomputing.stackexchange.com/questions/25955/did...
The answers at your link explain pretty well what kind of APIs these were and they provide sources, e.g. the several books that have been published under titles like "Undocumented Windows ...". There were no magic APIs, just ordinary functions that covered various features not yet implemented in the publicly available Win32 API.
Keep in mind also that the Windows kernel system calls were never accessible directly, like in Linux or the like, but as an external developer you were at the mercy of the user libraries provided by Microsoft. If the documented user libraries did not cover all the features actually implemented by the operating system, there was no way to use them without reverse engineering.
This is now pretty much ancient history and later such APIs have been documented by Microsoft, e.g. in the "Windows Protocols Specifications", mostly as a consequence of lawsuits and investigations by the European Union and FTC.
However when that happened, around 2000, the damage had already been done and the competition had been eliminated.
The dominance of Microsoft in office suites that has been achieved during the transition from MS-DOS to Windows 95, than Windows 98, has succeeded in good part because of the great increase in the number of computer users during this time.
For newbies, the MS Office suite took very well advantage of the new features enabled by a GUI and MS Office was very easy to use, while the Windows versions of the older MS-DOS programs, like Lotus 1-2-3 and WordPerfect were much less polished than MS Office, while simultaneously losing their previous keyboard-based user interface, which for experienced users had been much faster at accomplishing any task than any Microsoft GUI.
So the MS Office GUI alternatives were neither easier to use nor faster, therefore not even their former users had any reason to stick with them, while all the newbies were naturally attracted to MS Office.
Moreover, starting with Windows 95, Microsoft has convinced somehow all the hardware peripheral add-on-cards to stop documenting their products, but instead of that deliver them together with only Windows device drivers.
Since that time, the non-Microsoft operating systems had to rely mostly on reverse-engineering for being able to run on modern hardware. Many years later, the situation has improved somewhat, but only for certain classes of peripherals, like network interface cards, where the vendors typically also provide Linux drivers now.
This has hit also the old MS-DOS programs like Lotus 1-2-3, which had tons of drivers for various kinds of now obsolete Super-VGA video cards, so on new computers with Windows 95 or later they had to run in some less performant video mode that was supported directly or through emulation on modern graphic cards, unlike the Windows programs that could take full advantage of the hardware. This has contributed to the obsolescence of the better MS-DOS programs, because even if Windows 95 could run them in Virtual 8086 mode they did not work as well as on the older computers for which the MS-DOS programs had drivers that took advantage of enhanced features.
The retro stackexchange post talks about win 3.x APIs, not Win32 APIs.
True, but nothing has changed in the next few years, every new Windows version had APIs that have been either documented publicly later than for internal developers or that have been documented only much later, after several years and during the time when Microsoft was already under investigation.
> They started giving away a full office suite with every new PC
Do you mean Microsoft Works[1]? Or were they more commonly shipping the full version of MS Office with new PCs in the UK?
[1] https://en.wikipedia.org/wiki/Microsoft_Works
Works... Now that's a name I haven't heard in a long time....
I almost forgot about Works.
That was the word processor for those of us without a lot of money in those days.
Microsoft Works 4.0 came with our first PC. It was all we used for quite a while.
In the case I dealt with, I was buying new Gateway PCs and they were shipping full Office Pro (including MS Access) for free with the PC.
The company I worked for at the time were pretty cost conscious so there was no way they would buy additional Wordperfect or Lotus 1-2-3 licenses on top of that, even though some of the staff much preferred those products.
I was only starting working with computers as an unpaid IT help at that time, but I distinctly remember that MS Office was just better. More streamlined, and well-integrated.
Back then, pretty much everybody in my country just pirated the software, so the cost was not a consideration at all.
MSO 97 was the pinnacle of usability and customizability per megabyte installed.
I only wish it were not so buggy when handling large documents.
That's why they replaced it. /s
It's worth noting that Microsoft was the first company to sell a complete office suite as a bundle for the PC. Others quickly caught on, but still MS Office was the only suite that had consistent UX across the different programs they were packaging together. Lotus SmartSuite checked all the same boxes on paper, but switching between the different programs feels like tripping on cracks in the sidewalk.
Well actually…
AppleWorks came out in 1984 for the Apple //e. Microsoft Office came out for the Mac in 1989.
"For the PC" is an important qualifier in my message above. I'm familiar with AppleWorks.
Fair enough. I was thinking about “PC” in the literal since not the common vernacular - x86 + Microsoft OS
There's an interesting debate there. Here's my thesis on it:
Isolating the definiton of "PC" to the IBM lineage makes it a lot easier to contextualize the historical development of home computing. Example: my TRS-80 is a microcomputer, but it is not a PC. This is a sentence that younger generations can grok. If I say "my TRS-80 is a PC but not an IBM PC-compatible" their eyes glaze over.
> Isolating the definiton of "PC" to the IBM lineage makes it a lot easier to contextualize the historical development of home computing
The definition of PC is IBM PC. That's why Visual Workstation is not a PC, Apollo DN3500 was not a PC, etc.
The “definition” of PC is “A personal computer (PC) is a microcomputer designed for use by one person at a time.”
In common parlance it has come to mean “a computer running a Microsoft operating system”. Most people these days would consider an Arm based computer running Windows a “PC”.
Back in the day, a word processor or spreadsheet app could cost several hundred dollars each. Buying an office suite was supposed to be cheaper than if you bought the 3 apps in an office suite separately.
Consistency in UX and integration between app in the office suite were other touted advantages.
Agree! If I remember correctly, Wordperfect and Word were neck and neck until Word 6.0.
Wordperfect and Word 5 were still close to tied.
Word 6.0 is where Microsoft finally pulled away.
The 90's were exciting times.
So many epic battles playing out on the covers of PC Magazine and other computing magazines of the day.
Borland Delphi vs Visual Basic
Word vs Wordperfect
Windows vs OS/2
Lotus vs Excel
Explorer vs Netscape
Oracle vs SQL Server
And many non-Microsoft battles.
Microsoft wasn't the clear winner in most battles until the mid-90s.
The current AI wars seem to be somewhat similar.
By 95 it was game over. WP for Windows sucked. Quatro Pro was dying. Office 95 was the final nail.
> Today’s entrepreneurs would do well to note that Microsoft made minimal use of venture capital. Microsoft’s only VC only owned 6.2 percent of the company. Gates didn’t trust them.
While the article touches on it here, Microsoft was able to avoid venture capital because it was highly profitable from its very early days. They turned their first profit in 1975, the same year they were founded.
It seems like more companies spend longer amounts of time being unprofitable and growing. How much of that is a zero interest rate phenomenon or the new normal?
Microsoft is also an outlier in having the CEOs and founders parent in the board of IBM who licensed Microsofts software.
Didn’t they only get the IBM contract in 1980 (i.e. 5 years after the company was founded)?
Although that is true, my point is that Bill Gates had an extremely privileged upbringing.
Bill Gates had access to advanced technologies in high school only 0.001% of other students would have.
Bill Gates had direct access to people only 0.001% of his peers would(and I’m no doubt being generous to Bill Gates here).
Bill Gates was a smart kid no doubt, but his environment accounts for most of his success.
Paul Allen, a high school friend of Bill Gates, read an issue of Popular Electronics. Paul showed Bill the article about a new minicomputer.
They cold-called the New Mexico company to push their non-existent BASIC interpreter. Bill took a leave of absence from Harvard and the microcomputer software business took off with the help of Harvard's computer resources.
see https://archive.org/details/197501PopularElectronics/page/n2...
You don't sink the shots that you never shoot - Bill Gates saw an opportunity and took a big shot from downtown.
But that was in 1975. He's made more shots than not since then.
That is absolutely true. But his upbringing gave him a near limitless amount of arrows in his quiver. You honestly don't think that was a huge advantage he had?
It's easy to "take a big shot" when you have all the support in the world.
Easier than without support, but not easy. Not everyone born to means goes on to found wildly successful companies.
Environment matters a tremendous amount. In common scientific terms, there is almost nothing that is not environment. DNA, development, parenting, personality can all be framed as environmentally derived.
Sometimes these factors come together to give people huge advantages, both in situation and support, but also talent, knowledge, and personality.
I think the lesson we should take away from this is the importance of good environmental influences in producing good outcomes.
I agree with you except for one thing.
I wouldn’t argue that Bill Gates was a good outcome.
The world needs more Bill Joys.
Wow what a great point.
it was an outlier then and it’s an outlier now
Indie dev turning profit first year is part of the typically success story for indie devs.
Something I find interesting about early technology IPOs is how early they IPO-ed compared to more recent tech companies and how much of their growth and value creation happened post-IPO.
- Microsoft IPOed in 11years, profitable and at a ~$800M valuation. They hit a ~$1T valuation in 2000. During the 90s, their stock roughly doubled each year, for a 1000x growth.
- Amazon IPOed in ~3 years, unprofitable and at ~$300M valuation. Their stock has 2200x since then.
- Google IPOed in ~6 years, proftiable and at a $25B valuation. Their stock has ~80x since then.
- Facebook IPOed in ~8 years, profitable and at $100B valuation. Their stock has 20x since then.
I think the ZIRP era led many companies to avoid going public, either because of access to easy money or because their financial didn't need to be disciplined enough. The high levels of pre-IPO funding also has led to many/most of them underperforming in the public markets.
A16Z had an article on the lack of IPOs:
https://a16z.com/where-have-all-the-ipos-gone/
Regulatory compliance like Sarbanes Oxley is another huge factor. And VC's having large capital pools make it easy for companies to stay private vastly longer without needing to raise funding from the public.
It's very unfortunate for the public markets, as basic only VC's and PE get access to high growth young companies. Now most of the growth is squeezed out by the VC's and the public gets just the tail end of mature companies.
To be fair, 10-15% of VC money is from pension funds, so there is some indirect participation from the general public
I'm suprised the VCs aren't pushing IPOs more.
A lack of IPOs makes the startup life much less attractive than sitting around at a post-IPO company, which also means a harder time growing the startups the VCs are investing in
> suprised the VCs aren't pushing IPOs more
Harder to charge 2 & 20 on public equities.
I hadn't considered their fee structure.
I guess it also likely not helpful to the VCs to have the public market having real opinions about the valuation that the fees are presumably based on, unless the company is a clear runaway success
If you look right here on HN you will see how many gullible people think there equity will be statistically worth something.
You would be surprised how many true believers there are out there
There’s some market/observer bias in these numbers; they hit four very different eras of VC and public markets perspectives on tech stocks.
VCs in the Microsoft IPO era would proudly display a tombstone for a $50mm IPO raise. It was a very different time.
Google was the first tech company to really test the bounds and power of Investment banks in the IPO process — they went with some sort of auction type mechanism (if I recall correctly), intended to keep bankers from making “too much” on the IPO, and were roundly snubbed by the sell side arms of those same bankers, resulting in a very low flotation. Which worked out fine for them.
By the time Zuck IPOed, he had enough power and we had enough tech history that he was able to run a MAJOR IPO and retain complete control of the company. And, from a financial perspective, very well deserved.
In each of these four eras, the perceived (and actual I guess) size of the addressable market for a tech company was roughly an order of magnitude larger than the prior, and combined with wealthier VCs from prior rounds, and more pattern recognition about business models, we see more of the value being captured early, out of the public markets.
Apple was the first company to reach a $1 trillion market capitalization, achieving this milestone in August 2018.
Microsoft reached a valuation of $1 trillion on April 25, 2019.
You're right. On Dec. 27, 1999, Microsoft's market cap hit hit $614 billion.
I might have confused it with some "inflation adjusted market cap" I read somewhere.
That’s 1.175 trillion in today’s dollars according to https://www.usinflationcalculator.com/
Apple (AAPL) dropped down to $0.12 in Dec 1997.
27 years later, stock price hit its high of $260.10 in 2024 Dec.
2167x.
That's a mighty impressive run by Steve Jobs and Tim Cook.
Yeah but that was their worst moment. Michael Dell joked someone should buy Apple for a few bucks and put them out of their misery.
Of course history went another way but it was pretty close. And really, Steve Jobs wouldn't have been the leader he was without NeXT and Pixar. It was unfair how he got fired by Pepsi guy (Edit: That was John Sculley, I had forgotten his name) but he wasn't ready to lead Apple the size it was at that time. Things just came together at just the right moment.
I have occasionally wondered about that. If Steve Jobs did not get fired by Sculley, would we still have the Apple we do today. I lean towards unlikely. I do think Steve had some growing up to do.
I still hold the theory that the entire success of Apple post-1997 hinged on iTunes for Windows.
iMac and iPod were good products but iPod was stumbling along as a Mac-only product. Letting PC users use iPods opened the cash floodgates and let the iPhone get developed.
> Something I find interesting about early technology IPOs is how early they IPO-ed compared to more recent tech companies
I am unable to resolve this sentence with the list that follows that has Microsoft IPOing significantly later in their life than the three others listed. Microsoft IPO'ed later compared to Amazon, Google, and Facebook.
I think it’s not explicitly stated but consider the companies that have not IPOd and getting funding privately - I think that was his point.
They mean that list compared to companies today.
Yup. Strikes me as obvious that folks figured out how to get in there earlier rather than leave it to the public markets. Just sort of speaks to a combination of market efficiency plus increased regulation in my mind.
Most of people's issues with the Securities Exchange Commission came from changes in corporate behavior that made people notice they had an issue with the Securities Exchange Commission
the SEC's class dividing rules were ignorable when companies were IPOing at low marketcaps
people don't want to only buy companies after all the growth is seemingly done at 50bn-100bn+ marketcaps, while not having access to private markets or low liquidity in private markets
so they pursue things outside of the SEC's protection
Before the dotcom boom there was a rule of thumb in the Valley: "in order to go public you have to have 5 consecutive quarters of profit"
These days that's all gone out the window, but you can see why back then companies that did go public were more likely to succeed
Microsoft's IPO did not lead to the dotcom bubble.
It was Netscape's IPO that did that.
Microsoft and Intel's stocks were a big deal in the 90's. But they were solid businesses.
To my memory, the idea of getting rich overnight simply by being tied to the Internet started with the Netscape IPO.
Yep. Michael Lewis’s book The New New Thing is a great little window into that timeframe. He claims Jim Clark really wanted a new boat, so Clark forced the IPO on the board to get some liquidity.
Another major moment marking a ‘new market dynamic’ was Microsoft buying Hotmail in 1997 for roughly $400mm? Pretty much unheard of pricing for a web company.
People play up Bill Gates’ connections, sure, but next to no 16-year-olds could program BASIC in assembly.
Microsoft’s success was as much to do with them being a programming languages company first. DOS, Windows 3.1, and even Windows 95 shipped with an interpreter and compiler for their BASIC and C, respectively. This empowered developers to use and write code for the OS out-of-the-box.
Correct regarding the BASIC. MS DOS (and even MSX BASIC and MSX DOS) was pretty important though in the grand scheme of the ecosystem forming.
But neither Windows nor DOS shipped with a C compiler; it's not a Unix. DOS shipped with an IDE for BASIC, and compilers were available but not free. The more accessible option was Turbo Pascal (and then Delphi 1), Visual Basic was also popular but more costly.
GCC appeared in 1987 but only worked acceptably under Unix-like OSes.
Windows didn't come with any C compiler out of the box. And no basic either. Where did you get this idea?
Also qbasic was not the same as quickbasic, and it had a limit on the LOC and other limitations.
Windows 95 and 98 came with QBasic, but it was not installed by default. It was an optional "extra feature" that could be added from your Windows installation media.
I do not know about earlier versions of Windows.
qbasic is not a C compiler. It was also not possible to make windows applications with it… and it lacked the option to generate a .exe file.
It was more of a toy.
I apologize for misreading your post, I thought you asserted that Windows did not come with QBasic. I'm well aware of what QBasic was - it's what I used when I first learned programming. It was an excellent toy for 12yo me.
Hmm yeah Gates was a bit of a programming prodigy sure. But none of Microsoft's success really has anything to do with that. It was all about smart business acumen, starting with the deal made with IBM, being allowed to sell MS-DOS to PC clone makers.
To me, Visual Basic (not Visual Basic .NET) was the game changer for Microsoft. It empowered many power users (user, not programmer) to create software that they couldn’t find on the market.
Microsoft shipped OSes with a crappy version of BASIC. But every computer did, before the PC came out.
The BASIC interpreter on most of those other computers was written by Microsoft
> Today’s entrepreneurs would do well to note that Microsoft made minimal use of venture capital. Microsoft’s only VC only owned 6.2 percent of the company. Gates didn’t trust them.
> If you’re thinking of trying your hand at being the next Bill Gates, keep that in mind.
Keep what in mind? Sure so try to build a company now w/o VC money and potentially complete with others who have taken that money? Microsoft obviously had an advantage of a completely new industry AND literaly very little VC money (and in vastly tighter amounts) funding competitors.
Some analysis here that I just don’t agree with.
> [summarized] Amazon didn’t turn a profit until 2003
That was 100% by design. Why make profits when you can grow? Profits are taxed. Reinvesting in growth is generally not taxed, and you are rewarded by the market as it projects out how long your growth could continue and reflects that in your stock price.
To be fair, the idea that you might buy a stock for something other than its likely dividend and that this wouldn’t just be a momentum trade is an idea that was finally cemented somewhere in the dotcom 1/dotcom 2 era. Still.
Why doesn't this apply to Stripe with its 8,500 employees?
> The reason Microsoft had to go public in 1986 was because Bill Gates had been using stock to attract talent. Microsoft projected that by sometime in 1987, they would have 500 shareholders, which would require Microsoft to register with the Securities and Exchange Commission, effectively turning them into a publicly traded company, but without the benefits of going public in the conventional way.
> Backed into this corner, Gates agreed in late 1985 to pursue an IPO.
The rule was changed in 2012 according to articles on investopedia.com ( https://www.investopedia.com/terms/5/500-shareholder-thresho... and https://www.investopedia.com/terms/1/2000-investor-limit.asp )
The limit has been raised to 2,000 shareholders. The company isn't required to go public, but the company does have to file its financial data with the SEC.
Thats sort of what I thought, Do the rest of us get to see the financial information?
There are workarounds. Not sure if Stripe is using any of them, but the gist of it is to create subsidiaries that don't employ more than 2000 people (that's the current limit). So for example you'd have Stripe Engineering Inc., and Stripe Marketing Inc. and so on.
It’s interesting how much of the company Paul Allen owned at the time without being any longer involved with the company. I suspect that in 2025 he would have been bought out or pressured to return equity by that point