There's a great photo of Bill Gates from 1977, the year he would have graduated from Harvard if he hadn't dropped out. He was 22 at the time and looks all of 16. He's got a flowered collar, tinted glasses and feathered blond hair, and he looks so happy, you'd swear he knew what the rest of his life was going to be like. He also has a sign around his neck: it's a mug shot. "I was out driving Paul [Allen]'s car," Gates says, flashing that same smile 30 years later. "They pulled me over, and I didn't have my license, and they put me in with all the drunks all night long. And that's why the rest of my life, I've always tried to have a fair amount of cash with me. I like the idea of being able to bail myself out." Mission accomplished.
It is the destiny of revolutionaries — the successful ones, anyway — to end their careers as part of the Establishment they once sought to overthrow. This is true of Gates, whose success has been so total, it has annihilated all memory of the cocky, visionary, deeply weird teenager he once was, a child of the moneyed �lite who threw away a Harvard education to found a company in an industry that at the time consisted of a few shut-ins with full beards in Albuquerque, N.M.
Now, at 51, Gates has gone back to Harvard, effectively closing the loop between Bills 1.0 and 2.0. He delivered the commencement address at Harvard on June 7 and accepted an honorary degree. But on some level he's still that grinning, cocky kid in the mug shot, and to prove it, he's dropping out all over again. He is transitioning out of Microsoft to become a full-time philanthropist-at-large, directing his formidable intelligence and ridiculous wealth at improving global education and global health. But who is this new Gates, Bill 3.0? And what makes him think a software guy has the answers to humanity's oldest, toughest, messiest problems?
Gates' life is a classic American riches-to-even-more-riches story. Growing up the son of a successful Seattle-area attorney, he was a curious fusion of nerd and bad boy. He was a straight-arrow student, but it was never enough to be the best. He had to push everything a little too far — he wanted to win the game and break the rules at the same time to show he was even smarter than the guy who wrote the rules. In high school, he and Allen, with whom Gates would later co-found Microsoft, were obsessed with programming a mainframe owned by a local company. But mastering it wasn't enough. "We did this thing where we proved you could steal the password file," Gates says. "Paul and I were banned from using the computer for a year."
The same was true at Harvard. A brilliant math student, Gates would blow off his classes to go to ones he hadn't registered for. He would slack all semester, then cram at the last minute and ace the final. He met Steve Ballmer, Microsoft's current CEO, when they both talked their way into a graduate course in microeconomics. (Gates says he came away with the top grade on the final exam.) "The only computer-science course that I ever signed up for was the one that had the most prerequisites in the whole catalog — and I signed up for the second half of the year," Gates says. "So my freshman year I show up, and it's all graduate students, and two days into the course I tell the professor, Hey, you know, this thing is wrong ... My social skills weren't that great."
Pretty soon Gates and Allen twigged that there was a bigger game going on, even bigger than Harvard. "We'd agreed the microprocessor was going to change the world," Gates remembers. "It was weird that people didn't see that." A Popular Mechanics cover story about an early personal computer called the Altair was what doomed Gates' career at Harvard. "The thing that Paul and I had been talking about happening was happening," he says, "and we're sitting there going, Oh, no, it's happening without us!" Gates had realized that there was a future in writing and selling software for personal computers. It was one of the great technology and business insights of the century. Harvard wasn't impressed. When Gates and Allen sold the Altair folks a version of basic — which they wrote without ever having seen an Altair — the school brought him up on disciplinary charges for running a business out of his dorm room. So Gates turned on, booted up and dropped out.
Gates wasn't just the nascent titan of a new industry. He was the harbinger of that quintessential fin de millennium American type, the power nerd. He didn't have social skills, but then again, he wasn't running for prom king. The forces that were reshaping the world weren't political or cultural anymore; they were technological, and if you knew where the bits and bytes were buried, you had the power. Long before the dotcom boom, long before it was hip to be square, Gates crossed over to the dork side.
Gates' social skills still aren't all that great. He may omit to shake your hand when you meet him. His voice has one setting: high and loud. He still has that much remarked-upon habit of rocking back and forth while he's thinking, and he sometimes jumps up, rather startlingly, to pace while he's talking.
But there's a warmth to him and a weird but genuine charm. It's always a pleasure to interview Gates, not because he's a good talker but because he isn't: he doesn't talk you around, doesn't spin you or snow you, or if he does, he does it so badly that you can see it coming a mile off. It's just how his mind works — he can't help answering your questions seriously and literally. There are tales, probably true, of his brutally breaking down employees in meetings. He likes the truth, and he likes things to be clear. I sit in on a meeting in which he works through the kinks in his Harvard speech. He stumbles on a superfluous phrase: more fully. "That's the kind of stuff I hate," he says, pausing for a minute to riff. "I delete stuff like that all the time. The word truly — whenever I see it, I tend to delete it. Why say 'truly X'? Is 'X' not enough?"
That's typical of Gates: he takes an engineer's approach — a literal, analytical, hacker's approach — to everything, whether it's an engineering problem or not. This isn't always the best approach. On the one hand, it's worked out pretty well for making software. On the other hand, look at Gates' haircut.
And take another look at that software. Microsoft makes efficient business tools, but they've never enjoyed the same reputation for simplicity and elegance as, say, Apple's. For all his drive and intelligence, Gates doesn't see things with an artist's eye for those human intangibles. In May, Gates made a rare and instructive public appearance with his longtime frenemy Steve Jobs. An audience member asked each of them what he had learned from the other. "Well, I'd give a lot to have Steve's taste," Gates said. "You know, we sat in Mac product reviews where there were questions about software choices, how things would be done, that I viewed as an engineering question. That's just how my mind works. And I'd see Steve make the decision based on a sense of people and product that is even hard for me to explain. The way he does things is just different, and you know, I think it's magical." The audience cracked up. But Gates wasn't joking.
So it'll be interesting to watch Gates try his Vulcan approach on challenges like curing AIDS and fixing America's public schools. In July 2008, his primary focus will become the Bill & Melinda Gates Foundation, which he and his wife founded to address health and education issues. It has an endowment of more than $33 billion, making it by far the largest charitable foundation in the world. Last year his close friend Warren Buffett committed to transferring to the foundation much of his wealth too, which will eventually add about $30 billion more. Gates' foundation makes him one of the most powerful nonelected actors on the global stage.
The worst grade Gates ever got at Harvard, a C+, was in organic chemistry. Now he has to study it all the time. He monitors clinical research, talks to doctors, sits in classrooms, flies to infectious hot zones. As a foe of disease and ignorance, he is fearsome.
Gates refers to his philanthropic work as "solving inequity," as if it were a long-division problem. When Gates looks at the world, a world in which millions of preventable deaths occur each year, he sees an irrational, inefficient, broken system, an application that needs to be debugged. It shocks him — his word — that people don't see this, the same way it shocked him that nobody but he and Allen saw the microchip for what it was. "We had just assumed that if millions of children were dying and they could be saved, the world would make it a priority to discover and deliver the medicines to save them," he said in his Harvard speech. "But it did not."
Gates isn't just focused on specific diseases and educational deficits. To him, that's thinking small. Like the high school password stealer he once was, the cocky Harvard kid, Gates wants to rewrite the rules of the whole system. He's all for capitalism — it has treated him well — but he gets that it's not going to take care of everybody. The financial incentives to take care of the disadvantaged just aren't there.
So capitalism itself needs to be re-engineered. In his Harvard speech he introduces an idea he calls creative capitalism. "That may be the most important phrase in there," he says, "in the sense that capitalism has really triumphed in this incredible way, and certainly for at least a billion people, it's done a spectacular job, and alternative systems have not. Yet there's this strong feeling that getting that system to direct itself to the right problem — there's more that can be done." In the speech he exhorts the students and faculty to do something about it: to hack the system and add the features it needs to address these problems. He cites a practice called advance market commitment, in which governments band together to guarantee orders for an expensive and otherwise financially risky vaccine. "That's the kind of idea. It's about using competition and market incentives but directing it the right way."
If there's a limit to what Gates can do, it's always going to be found in that human element, the messy, fallible, unquantifiable stuff that doesn't respond to engineering. His limitations as a technologist will be his limitations as a philanthropist. But he knows he's not writing software anymore. "There are some [problems], like discovering a vaccine for malaria, that actually are surprisingly similar," he says. "That is, a bit like a software project. Some things like designing high schools and new high school curricula and the way that you need to have the community and the teachers, particularly their union, feel like they need to participate in that ... that's a very tough thing."
Gates is probably getting out of technology at the right time. Funnily enough, it's not really a business for nerds anymore. Gates was at the center of the personal-computer revolution and the Internet revolution, but now the big innovations are about exactly the things he's bad at. The iPod was an aesthetic revolution. MySpace was a social revolution. YouTube was an entertainment revolution. This is not what Gates does. Technology doesn't need him anymore.
Now education and health care — those are areas in which the bedrock problems, the bits and bytes, have yet to be solved. All that pretty, fluffy stuff, that can come later. That's for the cool kids to figure out. Sickness, death, ignorance, illiteracy — those are the problems that need nerds. That's where Gates 3.0 needs to be, and that's where he's going.