Budding entrepreneurs and philanthropists want to know how Gates amassed his fortune so that they might join the Billionaires\u2019 Club one day. Here are just a few ways that Bill Gates was able to become a massive success.<\/p>\n
Last updated: April 5, 2021<\/em><\/p>\n He Has a Thirst for Knowledge His Parents Were Supportive He Reads a Lot He Chose a Great Business Partner He Stayed Confident in His Dream and Vision He Had an Emergency Fund for Microsoft He Learned From His Mistakes With Microsoft He Gets Seven Hours of Sleep He Has a Good Money Manager He Diversified His Private Portfolio He Knew When He'd Outgrown Partnerships He Learned To Give Up Control He Has Remained Passionate About His Work <\/p>\n
Gates attended Harvard University only briefly before he dropped out, yet he attributes his time there to his success. \u201cIt was an amazing privilege (studying at Harvard), and though I left early, I was transformed by my years at Harvard, the friendships I made, and the ideas I worked on,\u201d Gates said in a 2007 commencement speech.Gates studied computers, but he also dabbled in many other subjects that interested him at the Ivy League school. \u201cAcademic life was fascinating,\u201d he said during the speech. \u201cI used to sit in on lots of classes I hadn\u2019t even signed up for.\u201d This thirst for knowledge and his willingness to always improve and learn contributed to the growth of his eventual business.<\/p>\n<\/p>\n
When asked in 1998 about his role models, Gates said he looked up to his parents. \u201cI had great parents, both of whom were involved in lots of interesting activities and would come home and talk to us about the world of business or law or politics or the charitable activities they were involved in,\u201d he said.Gates\u2019 parents nurtured and supported his interest in computers as well \u2014 even after he decided to abandon his Harvard education. Gates\u2019 father, Bill Gates Sr., told Forbes that his son\u2019s decision to drop out of college \u201cwasn\u2019t precisely what my wife and I had envisioned for any of our children.\u201dHowever, Gates\u2019 parents were extremely supportive of his endeavors after that. After Gates\u2019 mother died in 1994, The New York Times reported that she had helped her son \u201cget the contract that led to a lucrative relationship with IBM for his fledgling Microsoft Corporation.\u201dAs for his father, Gates long cited him as an inspiration for his philanthropic work, which has dominated the younger Gates\u2019 time and energies since he left his day-to-day work at Microsoft in 2008. The elder Gates was actively involved in his son\u2019s philanthropic work \u2014 he even wrote the first check for Gates\u2019 foundation \u2014 until his death in September at the age of 94.Check Out: <\/em><\/strong>20 Hobbies of the Rich Only They Can Afford<\/em><\/strong><\/p>\n<\/p>\n
In the Forbes interview, Gates\u2019 father said his son was an incredibly avid reader as a child. \u201cJust about every kind of book interested him \u2014 encyclopedias, science fiction, you name it,\u201d he said. \u201cI was thrilled that my child was such an avid reader, but he read so much that Bill\u2019s mother and I had to institute a rule: no books at the dinner table.\u201dGates has maintained his love of reading throughout his life. He even has his own blog where he frequently recommends books to his readers.Reading likely contributed to Gates\u2019 net worth, as it helped provide him with the knowledge he would need to become a successful entrepreneur.Take a Look: <\/em><\/strong>9 Best Personal Finance Books To Read<\/em><\/strong><\/p>\n<\/p>\n
Gates has made countless brilliant business decisions, many of which have involved the people he has chosen to work with. \u201cI\u2019d say my best business decisions really have to do with picking people,\u201d Gates said in the 1998 interview. \u201cDeciding to go into partnership with Paul Allen is probably at the top of the list.\u201dAllen and Gates were friends growing up, and they co-founded Microsoft in 1975. Allen left the company eight years later after being diagnosed with Hodgkin\u2019s disease. A fellow philanthropist who gave away more than $2 billion, Allen owned the NFL\u2019s Seattle Seahawks and the NBA\u2019s Portland Trail Blazers at the time of his death from complications of non-Hodgkin\u2019s lymphoma in 2018 at age 65. Throughout the years, Gates and Allen had a \u201ccomplex relationship,\u201d as outlined in Allen\u2019s book, \u201cIdea Man: A Memoir by the Cofounder of Microsoft.\u201d However, Gates attributes Microsoft\u2019s early success to his partnership with Allen and the many lessons they learned along the way. <\/p>\n<\/p>\n
Gates was fortunate to attend Lakeside School, an elite private school in Seattle that gave him access to computers when he was in the seventh grade. And instead of just teaching students how to use computers in the conventional sense, the school \u201cunleashed\u201d them, according to Gates. Looking back, he said his experiences at the school gave him the encouragement he needed to do the impossible.\u201cThe experience and insight Paul Allen and I gained here gave us the confidence to start a company based on this wild idea that nobody else agreed with \u2014 that computer chips were going to become so powerful that computers and software would become a tool that would be on every desk and in every home,\u201d Gates said in a 2005 speech at his former school.Read: <\/em><\/strong>19 Traits of Highly Successful Billionaires<\/em><\/strong><\/p>\n<\/p>\n
Gates learned early that in order to be successful, he had to amass a large emergency fund for Microsoft, which would keep the business afloat if it ever encountered financial obstacles.\u201cI got this incredibly conservative approach that I wanted to have enough money in the bank to pay a year\u2019s worth of payroll even if we didn\u2019t get any payments coming in, and I\u2019m almost true to that the whole time,\u201d he said during a 1998 interview. \u201cWe have almost $10 billion now, which is pretty much enough for the next year.\u201d<\/p>\n<\/p>\n
Everyone makes mistakes, including Gates. The key, however, is to learn from those mistakes, and that\u2019s exactly what Gates does.In a 2008 BBC interview in which he talked about how Microsoft was able to beat competitors, Gates said, \u201cOur products were successful enough that even when we did make a mistake \u2014 when we hired the wrong person or organized things the wrong way \u2014 we were frank enough with ourselves to say, \u2018Oops, this isn\u2019t working.\u2019 And yet, my conservative balance sheet approach meant that for all the mistakes we made, we had a chance to learn from them and do different things.\u201dThis ability to be creative, work with his team and have a big enough cash cushion to continuously grow and try new things contributed greatly to Microsoft\u2019s success and, eventually, Gates\u2019 fortune.See: <\/em><\/strong>Here\u2019s What Bill Gates Says You Should Do With Your Money<\/em><\/strong><\/p>\n<\/p>\n
Although many successful businessmen like to brag about how little sleep they get, Gates is the opposite. He knows he\u2019s not superhuman and that sleep is required for his intellectual curiosity to be at its best.\u201cI like to get seven hours of sleep,\u201d he told The Seattle Times in 1990. \u201cEven though it\u2019s fun to stay up all night \u2014 maybe taking a red-eye flight \u2014 if I have to be creative, I need seven hours. I can give a speech without much sleep; I can do parts of my job that way. But in thinking creatively \u2014 I\u2019m not much good without seven hours.\u201d<\/p>\n<\/p>\n
When it comes to choosing a financial advisor, Gates certainly knows how to pick \u2019em. His money manager, Michael Larson, is largely responsible for growing Gates\u2019 fortune.Business Insider reported in 2014 that Gates hired Larson more than two decades ago \u2014 when his net worth was $5 billion \u2014 to run his personal investment company, Cascade Investment, LLC. According to Business Insider, Gates is \u201cgetting richer faster than he can give his money away\u201d thanks to Larson.Larson also manages investment assets for the Bill & Melinda Gates Foundation. Check Out: <\/em><\/strong>Warren Buffett, Mark Zuckerberg and Other Rich People Not Leaving a Fortune to Their Kids<\/em><\/strong><\/p>\n<\/p>\n
When Gates was building Microsoft, he put most of his time, energy and creative talent into making it arguably the greatest tech company in the world. Once he got rich, however, he did what most financial advisors recommend investors do regardless of their net worth \u2014 he diversified. Gates sold most of his Microsoft stock \u2014 he now owns a little more than 1% of the company\u2019s shares. He then used the cash to invest in a wide range of different stocks and other assets that protected his massive portfolio from a single-security calamity and sent his already sizable fortune soaring.<\/p>\n<\/p>\n
Microsoft\u2019s partnership with IBM formed the backbone of the 1980s personal computer revolution. The two companies collaborated to create the operating systems that breathed life into most PCs. By the early 1990s, however, the partnership had stagnated and Gates determined Microsoft would be better going it alone. The gamble paid off. When the separation was complete in 1992, IBM walked away with the jointly created OS\/2 operating system and Microsoft left with the software that would make it king: MS-DOS and Windows. In 2016, Forbes wrote of Gates, \u201cHis decision to divorce IBM stands as one of his best. Microsoft took control over its own destiny.\u201d <\/p>\n<\/p>\n
According to a 2019 report from Inc., Gates found success only after he learned to trust the people he hired and delegate responsibility to them. That, however, required Gates to do something that was antithetical to his entire personality \u2014 forfeit control. In Microsoft\u2019s early years, Gates maintained a tight grasp on everything that happened and did whatever he could himself, but how could he grow Microsoft to its full potential if he spent all day writing code or editing code that others had written? He couldn\u2019t. Instead, he developed relationships with key employees, and those relationships were based on mutual trust. He found that the new mentality allowed him to take on the role of mentor instead of micromanager, which, it turns out, suited him well. <\/p>\n<\/p>\n
As many entrepreneurs have said, you must love what you do if you hope to be successful. Bill Gates fell in love with computers as a child and spent a lifetime building one of the most successful businesses in the world.\u201cYou\u2019ve got to enjoy what you do every day, and for me that\u2019s working with very smart people,\u201d Gates said in 1998. \u201cIt\u2019s working on new problems. \u2026 The competition, the breakthroughs, the research make the field I\u2019m in, I think, the most exciting field there is.\u201dEven though he left his day-to-day role at Microsoft more than a decade ago, Gates served as Microsoft\u2019s chairman of the board. In 2020, however, he left the board to focus solely on his philanthropic work. As the COVID-19 pandemic swept the world, Gates reinvented himself again by emerging as a leading advocate for science-based policy in government while donating hundreds of millions of dollars to coronavirus-related research and causes.More From GOBankingRates<\/em><\/strong>Nominate Your Favorite Small Business and Share With Your Community
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