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What entrepreneurs can learn from Paul Allen's Second Law



When Jeff Bezoses and Jack Dorseys jump out of the bow of the ships they sail out, what will happen to them? Where will they go?

When Paul Allen, co-founder of Microsoft, who died this week at the age of 65, left the business he started, he traveled around the world. He collected pictures and learned to dive. Diving, he said then, "brings me away from me."

Allen was right. Entrepreneurs who leave their businesses – be they because they have sold the business, they are ready to retire, or they are just done – have to get away from themselves. The founding and running of a business are all elaborate aspirations that deprive the identity of an entrepreneur.

Allen's identity will always be linked to his role in establishing Microsoft for the public. In 1

975 Allen convinced his childhood friend Bill Gates that they should develop a programming language to make computing accessible to more people. The bigger goal of a computer on every desk took several years to get the first project off the ground.

Gates and Allen became a boy-wonder duo that made Microsoft an important software company. But after suffering cancer in 1982, Allen decided that the clashes with Gates had an emotional impact on him and embarked on his world tour.

He never returned to Microsoft. What followed is lessons and a warning for entrepreneurs who will leave their business someday. The outcome can be an identity crisis, separation anxiety and fear of failure and often unrealistic expectations of success. These problems are incomprehensible to many people – exorbitant wealthy founders are rare but less so and can lead to feelings of isolation and abandonment. In Allen's case, Microsoft's IPO was not until three years after his departure, delaying some of the sudden assets after his exit until 1986, when his net assets rose $ 134 million overnight.

After his European tour in 1983, he returned home to Seattle, took out a business loan based on his experience with Microsoft, and started what he considered to be his rightful tech empire, different from Gates and the Company that co-founded them differed.

No Encore

19659009] His next move was followed by another frequent hiccup of travel in the second act, as one success does not guarantee the next. The circumstances of Microsoft's early momentum were unique to the founders, the personal computing environment and the state of the art. Allen, "attempted to regain the feeling that he had created Microsoft in the first place," I wrote in his 2003 biography of The Accidental Zillionaire . At Asymetrix, a software development store, he brought people together who gave him more creativity and inspiration than at Microsoft. In the end, however, the company was not ambitious enough to become the technology competitor expected by Allen. Another effort, Interval Research, dealt with some bolder concepts from Allen, including a service called SkyPix, which would broadcast broadband channel TV signals and a virtual reality platform called ePlanet. Again, a lack of commercial instincts proved fatal.

Many successful entrepreneurs became investors after their exits, and Allen did the same, founding Vulcan Inc. and stumbling here as well. The list of Vulcan investments that did not make it long and mostly forgotten: Virtual Vision, Egghead, Lone Wolf Technologies, Trilobyte, Medio Multimedia. Allen's hopes for a "wired world" led to a major investment in AOL in 1998, as well as a $ 4.5 billion deal to buy Charter Communications with the aim of getting into people's homes and providing them with services and entertainment Offer.

Entrepreneurs are not always natural born investors; They invest in a business and have one use case of one. Like Allen, it's easy for them to be enchanted by brilliant ideas, without any financial sense. Not all of Allen's investments were bombs; Starwave, essentially a website development store, was sold to Disney for $ 200 million, bringing Allen $ 100 million. And the "wired world" approach he finally adopted brought meaning and order to where he used his money.

Put simply, Allen remained a strong technologist, but lacked the operational acumen of his former partner. He never built the tech empire he envisioned, never reaching a tech identity outside of Microsoft.

Throughout the 1990s, Allen continued his search for a next act. Previously a billionaire, thanks to Microsoft's ongoing success, he began exploring non-technology interests. He bought the Portland Trail Blazers and Seattle Seahawks and built a tribute to his childhood hero Jimi Hendrix, called Experience Music Project, in his hometown of Seattle.

In the 2000s, Allen finally seemed to be bypassing his technique ambitions as he entered more into philanthropy for brain research, disease remedy, climate change, the arts and more. He launched his own space missions, which built launchers and space transports. By the mixture of sport, space, science and Hendrix Allen finally came to his right. More than 20 years after leaving the company, Allen had gained an identity that was more than Microsoft.

How come it took him so long? It's easy to forget that Allen was only 30 years old when he left Microsoft at a time when there were fewer tech millionaires and fewer than 40. There was no clear blueprint for what to do next , Microsoft had not gone public yet, and that was the true turning point for Allen. The source of his wealth was Microsoft, so he was always "Microsoft".

Business owners today benefit from a culture of philanthropy that involves them in causes and activities outside their daily work. Salesforce employee Marc Benioff has spent billions on medical care, as does Mark Zuckerberg, who plans to cure every illness in his young daughter's life. Bezos launched its own philanthropic project this year.

If these and other stars of the tech world move on to their next phase, they would see Allen after Microsoft as a peer on a similar journey. He wisely took his time to separate his identity from his previous business, but failed to separate the dreams of his first business from the realities of starting the next one. And though he had good intentions, he misunderstood the value of his money and how he could spend it.

We called Allen the "accidental zillionaire". But he found his way like any other entrepreneur in search of his next act.


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