Poison partnerships

The storied history of Microsoft is currently under review after co-founder Paul Allen released a new memoir called Ideas Man, containing explosive revelations about his relationship with fellow co-founder Bill Gates.

While excerpts from the book published in Vanity Fair suggest the relationship between the pair, who met at high school, was often stormy during the establishment of Microsoft, what’s grabbed headlines around the world is Allen’s revelations about events in 1982.

That year, Allen overhead Gates and Microsoft executive Steve Ballmer complaining about Allen’s lack of productivity since he was diagnosed with cancer.

Allen claims he listened in on the conversation, which then moved on to Gates and Ballmer talking about ways to reduce Allen’s stake in the company.

He then claims he burst into the room, shouting: “This is unbelievable! It shows your true character, once and for all.”

Both men would quickly apologise; Allen says Gates wrote him a six-page letter stating: “During the last 14 years we have had numerous disagreements. However, I doubt any two partners have ever agreed on as much both in terms of specific decisions and their general idea of how to view things.”

According to Allen, the apology didn’t stop Gates from making a low-ball offer for his shares in early 1983 when Allen left the company due to his illness.

In the wake of the controversy, both Gates and Allen have released statements saying how much they respect each other.

But the timing of the incident is interesting, coming as it does on the heels of news this week that Twitter co-founder Jack Dorsey is returning to his company after being booted out in 2008, and of course the Facebook biopic The Social Network, which focused on the split between founders Mark Zuckerberg and Eduardo Saverin.

Tech sector watchers will also remember that Steve Jobs was kicked out of Apple in 1984 (before returning as a prodigal son) and recall Sean Parker being forced out of Plaxo.

Based on these examples, do tech companies have a special problem with founders falling out?

I’d say probably not – business partnerships break up in all sorts of companies across all sorts of sectors, for all sorts of reasons.

But these examples do suggest something of a common thread within tech companies – the technology always comes first and the business can come second. When the pressure comes on for growth, the vision of founders can be very, very different and disputes can arise.

The problems are not insurmountable – a good CEO introduced at the right time appears to be crucial – but they are worth studying, particularly if you are a budding Microsoft?