Bill Gates Says Steve Ballmer Was The Business Partner He Badly Needed — So He Gave Up 4% Of Microsoft To Recruit Him

Bill Gates and Steve Ballmer pictured in 1998.

Getty Images

• Bill Gates details his early relationship with Steve Ballmer in his new "Source Code" memoir.
• Ballmer mirrored Gates' energy, boosted his social life, and became the business partner he needed.
• Gates gave Ballmer a 4% stake in Microsoft that's now worth more than $120 billion.

Bill Gates found a kindred spirit, a social connector, a confidant, a study buddy, and a true business partner in Steve Ballmer, he writes in his new memoir, "Source Code: My Beginnings."

Gates, the billionaire philanthropist who cofounded Microsoft, met Ballmer in a graduate economics class in the fall of 1976, when the pair were undergraduates at Harvard University.

The computing pioneer had heard from a friend that "Steve's a lot like you," and instantly recognized that Ballmer shared his "excess energy."

"Steve Ballmer had it beyond anyone I had ever known," Gates writes.

Ballmer was different from many of the students in Gates' dorm building, "nerdy math-science types" who largely socialized by playing Pong or poker in the basement.

"He had an unusual combination of brains and physicality and was effortlessly social," Gates writes, noting Ballmer managed the university's football team, oversaw advertising at its student newspaper, and was president of its literary magazine.

The future software tycoon recalled attending a football game and seeing Ballmer "expend just as much energy pacing and bouncing on the sidelines" as anyone on the field.

Gates writes that Ballmer widened his social circle and helped secure his entry into the exclusive Fox Club, known for its "black-tie parties, secret handshakes, and other archaic rules and rituals" that Gates would usually have avoided.

Microsoft's first CEO writes that he and his future successor spoke late at night about their life goals, whether it was better to work for the government or a company, and how they could improve society and maximize their impact on the world.

They also skipped most of their economics lectures, crammed together for the final, and were "triumphant" when they passed.

Bringing Ballmer on board

Gates had founded Microsoft with Paul Allen in 1975. They initially had a 60-40 split, but Gates felt he was more committed to building the company so he negotiated with Allen to make it 64-36.

He also realized he needed an around-the-clock business partner to talk through key decisions, pore over customer lists, manage the company's finances, and help him with "shouldering a hundred things like that every week."

Gates eventually gave his additional 4% stake to Ballmer to convince him to quit business school for Microsoft. "He joined in 1980 and became the 24-hour-a-day partner I needed," Gates wrote.

Steph Chambers/Getty Images

Ballmer succeeded Gates as Microsoft CEO in 2000 and still owned 4% of the company when he stepped down in 2014, regulatory filings show.

The LA Clippers owner's stake is worth more than $120 billion, and makes up the bulk of his estimated $145 billion net worth — putting him in 10th place on the Bloomberg Billionaires Index, just behind Warren Buffett and only three spots behind Gates.