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The Quiet Owner: Paul Allen (cont.)

Posted: Tuesday November 27, 2007 11:28AM; Updated: Friday November 30, 2007 9:23AM
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By L. Jon Wertheim

With the fortune Allen (lower right) made as a Microsoft cofounder, he has indulged loves that include music.
With the fortune Allen (lower right) made as a Microsoft cofounder, he has indulged loves that include music.

After graduation Allen headed to Washington State, while Gates would enroll at Harvard (though, according to lore, Allen got the higher SAT scores). Allen dropped out of college and moved to Boston, in part to be closer to Gates so they could work on their computer code. Soon Gates dropped out of school as well. They formed a company to develop computer language and named it Micro-Soft.

Often working through the night, Allen and Gates wrote a version of BASIC software that provided the programming language for the new Altair computer and sold it to Altair's manufacturer. Then they sold a similar version to IBM. After a stint in Albuquerque, where the makers of Altairs were based, the two moved their growing company home to suburban Seattle. While Gates was an aggressive marketer and a savvy businessman, Allen was perceived by many as the brains of the operation. In The Accidental Zillionaire, Laura Rich's unauthorized biography of Allen, the CEO of the company that made Altair computers recalled, "Paul was much more important... because Gates was hard to deal with. He assumed everyone was stupid, but Paul would listen to what was being said."

In the precious few hours that Allen wasn't at work staring at an electronic box, he'd cruise Seattle in his Porsche, frequent Dick's hamburger joint, take his dad to Sonics games and mess around on his guitar. He wasn't even 30 years old, and as far as he was concerned, he was living the good life.

But in the fall of 1982 he went to Europe on business for Microsoft (they'd dropped the hyphen) and felt ill and lethargic midway through the trip. When he returned to Seattle, he was told he had lymphoma, an often fatal cancer of the lymph nodes. The following morning the diagnosis was downgraded to Hodgkin's disease, which is far more treatable. Allen underwent radiation treatment; the cancer went into remission. Still, this encounter with mortality -- and his father's death at around the same time -- got him thinking: enough with the all-nighters and the cubicles with fluorescent lighting overhead. He wanted to live.

To Gates's surprise, Allen took a leave of absence in 1983 to travel and scuba dive and watch takeoffs at Cape Canaveral. Though he never returned to Microsoft, he retained a 28% share in the company. He founded a new technology company he called Asymetrix that hemorrhaged money, but ultimately it didn't matter. On March 13, 1986, Microsoft went public. By the end of the day Allen was worth $134 million. And that was just the beginning.

It was Dostoyevsky who observed that "money is coined liberty." Well, Allen was now free. After deploying a fail-safe strategy to gradually cash out his ever-burgeoning Microsoft stock, he accumulated the world's biggest toy collection. His heroic spending binge encompassed cars and yachts and so much fine art that trade magazines were calling Allen one of the world's top-spending collectors. He'd always thought World War II fighter planes were cool, so he bought a bunch of those. A lifelong music fan, he began amassing the world's largest collection of rock and roll memorabilia: Original lyric sheets. Costumes. Guitars. Particularly fond of another Seattle native, Jimi Hendrix, Allen paid an undisclosed fortune for the Stratocaster the rock star played at Woodstock.

Oh, boy!

He also bought a sports team. Though Allen had never been much of an athlete, basketball had always fed something in him. He spoke to friends about the "poetry of a slam dunk" and impressed them with his knowledge of the NBA. He first tried to purchase the Sonics, but when the team's owners declined, Allen ventured 170 miles south on I-5 to Portland. Few people even knew the Blazers were for sale, but in 1988 Allen snapped them up for $70 million.

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