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Source Code
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Chapter 12-EpilogueChapter Summaries & Analyses
Chapter 12 Summary: “Be So Correct”
Content Warning: This section of the guide includes discussion of death.
After the success of the Altair demonstration, Gates and Allen agreed to sign a licensing deal with the manufacturer called Micro Instrumentation and Telemetry Systems (MITS). They learned that hundreds of customers had already ordered the microcomputer and were also likely to order their software. The pair decided to officially form a company, which they called “Micro-Soft” because they were writing software for microcomputers. When Gates shared the good news with his classmates at Harvard, he was warned to stop using the Harvard PDP-10. Because the computer was funded by DARPA for research purposes, it could not be used for commercial products. Gates registered with a computer timesharing company in the suburbs and transferred his work there. Meanwhile, Allen was given a job at MITS.
In May, Gates was summoned by the associate director of the Aiken Lab to discuss his work. The associate director admonished Gates for the amount of time he spent in the lab, the fact that he brought in unauthorized users (Allen and Monte Davidoff), and the fact that Gates was working on a commercial product. He escalated Gates’s case to the Administrative Board, threatening Gates with expulsion. After Gates wrote a letter apologizing for his actions, they dismissed the charges and left him with a warning.
During the Administrative Board ordeal, Gates received support from a number of sources. His father helped Gates craft his defense, noting that the Aiken Lab was based on a spirit of exploration. His grandmother Gami reminded him that his work needed to be so ethically unquestionable that no one could criticize him. Aiken Lab director Tom Cheatham wrote the board directly to remind them that Gates started the project because he had exhausted Harvard’s computer classes and was bored. Gates suspects that the root of the conflict was the cost of computing at the time, which made it seem like a scarce resource.
Chapter 13 Summary: “Micro-Soft”
In the summer of 1975, Gates arrived in Albuquerque, New Mexico, to begin promoting the Altair and Micro-Soft’s new software, called 4K BASIC, with MITS. On a trip to the San Francisco area, Gates realized that personal computing was closely aligned with the hippie ethos of the 1970s, and hobby computerists believed that software could help the cause of freedom. After one presentation in Palo Alto, a copy of the 4K BASIC code was stolen, copied, and distributed among members of a hobby club.
Despite this setback, Gates and Allen determined to build Micro-Soft into what they called a “software factory,” developing different types of software for the rapidly growing personal computer market. Gates, Allen, and their high school friend Ric Weiland moved into a small apartment in Albuquerque and began developing two new versions of their Altair software. When MITS developed a new, cheaper microcomputer called the Altair 680, they wrote software for that too. They gave exclusive global rights for the software to MITS, with royalties on each copy sold. As Gates took over the business administration of the growing company, he convinced Allen to split their share of the company 60-40, with Gates taking the majority.
As he spent more time with the other MITS employees, Gates learned that many were dissatisfied with the way their founder, Ed Roberts, ran the organization. Gates asserted the independence of Micro-Soft by refusing to work until Roberts signed their contract. He unsuccessfully attempted to convince Roberts to stop selling faulty memory boards. The experience taught him that brilliant engineering does not always translate to good business sense.
When his father rejected a federal judgeship in order to honor his commitments at his law firm, Gates began seriously considering his own future. He wrote a scathing letter to software pirates, earning criticism from Roberts but support from some hobbyists. Gates decided to return to Harvard for the spring semester and hired Marc McDonald and Weiland as Micro-Soft’s first employees.
Chapter 14 Summary: “Source Code”
In the summer of 1976, a Business Week article was published celebrating MITS as the vanguard of the microcomputing revolution. As MITS grew in size and prestige, Gates worried that Micro-Soft was still licensed exclusively with the company. Gates and Allen began to develop new software using different coding languages, such as FORTRAN, COBOL, and FOCAL. They also hired new engineers from beyond their circle of Lakeside alumni.
Gates returned to Harvard for the fall semester of his junior year in 1976 but struggled with his lack of hands-on control of the company from a distance. He wrote a series of letters to Allen and Weiland, chastising them for not running the company properly in his absence. When he visited Albuquerque over Thanksgiving break, Gates helped to solidify contracts with Commodore International and Texas Instruments to develop new software for their upcoming microcomputers. He and Allen officially incorporated their company in New Mexico as Microsoft, losing the original hyphen.
Meanwhile, MITS was purchased by a company called Pertec and stopped paying royalties for sales of the BASIC software developed by Microsoft. Weiland left the company, putting more of the business administration work on Gates’s shoulders. As a result, he pushed Allen for more control of the company, taking 64% of the company to Allen’s 36%. Allen eventually accepted. Gates decided to take a leave of absence from Harvard.
At the West Coast Computing Faire, Gates met Apple co-founders Steve Jobs and Steve Wozniak for the first time. Meanwhile, Gates and Allen acquired a law firm to help in their fight to regain the rights to their software from Pertec and MITS, which was now a subsidiary of Pertec. When Microsoft’s lawyers accused Pertec and MITS of breach of contract, the companies responded by issuing a restraining order prohibiting Microsoft from licensing the BASIC software. The dispute went to arbitration, and Microsoft was ultimately successful. As a result, they were able to sell software to a number of companies, including Commodore and future rival Apple. The success of this software enabled the company to leave Albuquerque and establish their headquarters in Seattle, where Gates and Allen first began to experiment with computers.
Epilogue Summary
Gates’s grandmother Gami died in 1987. Following her wishes for the family to have a permanent retreat on the Hood Canal, Gates purchased a plot of land and built cabins for his family. His mother called the property the “Gatesaway,” and the extended Gates families began spending their holidays on the property. In July of 2012, Gates was visiting the property when he ran into his old friend Kent Evans’s father, Marvin. Gates and Marvin spent hours reminiscing about Evans and the boys’ early friendship. Gates assured Marvin that his success would not have been possible without the hours he spent in the Lakeside computer lab with Evans and reflected on the company they might have built together if Evans had lived.
Reflecting on his success, Gates acknowledges that he has been very lucky. Being born a white man in the United States gave him privileges that he might not have otherwise enjoyed. He also acknowledges that he was born at precisely the right time to succeed in computing, coming of age alongside the industry. Finally, he acknowledges the influence of his parents, who supported him while allowing him a degree of freedom, and the various teachers who helped stoke his love of math and computers.
Chapter 12-Epilogue Analysis
The final chapters and Epilogue of Source Code detail Gates’s journey from Harvard student to founder of an up-and-coming software company. The Epilogue is dedicated to identifying the “set of unique circumstances—mostly out of my control—that shaped both [his] character and [his] career” (319). The use of the terms “unique circumstances” and “out of my control” in this passage suggests that his career was influenced by chance and happenstance rather than effort alone. This framing reinforces one of the memoir’s core ideas—that success is a product of not only genius or ambition but also timing, privilege, and access. Gates’s acknowledgment of his good fortune subtly counters the traditional narrative of the self-made entrepreneur, situating his story within broader historical and technological shifts. However, his insistence on controlling the direction of Microsoft—often at the expense of his co-founder, Allen—suggests that his success was a product of not merely luck but also a deeply competitive and strategic mindset, which highlights The Value of Rivalry in Innovation.
Among the documents that Gates references in this section of the memoir is a letter that he wrote to Allen about the future of Microsoft, which he describes as “a three-page window into the mind of a new business owner, grinding through details” (249). The metaphor of the letter as a window into the mind of the young founder suggests that Gates understands its importance in the history of his company. More than just a business plan, the letter also reflects his evolving leadership style—one that balanced collaboration with a growing sense of personal authority. Yet Gates’s insistence on having a greater share of Microsoft than Allen—ultimately securing a 64-36 split—reveals an underlying belief that his vision and contributions were superior. This push for dominance, while perhaps justified from a business perspective, underscores his competitive nature and the extent to which he sought to establish himself as the company’s uncontested leader.
Gates also quotes an interview with Aiken Lab director Tom Cheatham related to his Administrative Board hearings and held “in [his] Harvard records” (251). Gates’s repeated references to “the Harvard notes” reflect the importance of this archive in his sense of self (251). Cheatham’s statement in the notes that “it would be a ‘travesty of justice’ if [Gates] was forced to withdraw from Harvard” (251)—as he eventually did, but on his own terms—suggests that Gates was not alone in thinking that future historians would be interested in researching his time at Harvard. The repeated references to archives of materials related to Gates’s early career suggest that, despite his arguments to the contrary in the Epilogue, Gates understood from an early age that his work was important and worthy of being documented and preserved.
These chapters reflect the novel’s thematic interest in Cultural Changes in Mid-Century America through their depiction of the transition from computers being thought of as tools for defense and corporate interests to tools for individual exploration. Gates positions himself at the vanguard of this revolution, moving away from the establishment and into the cutting edge. This transition is featured most prominently in the episode concerning Gates’s Administrative Board hearing while at Harvard. The associate director of the Aiken Lab warned Gates that “if the generals at the Department of Defense ever uncovered this scheme, they would have no choice but to cut off their generous funding of Harvard’s cutting-edge Aiken Computation Laboratory” (246). The consonance of the words “general” and “generous” in this passage draw a clear line between DARPA’s military power and the gift of computing being granted at Harvard, reinforcing the idea that the computers belonged to the government, not the school. Gates’s punishment reflects the idea that computers were “a scarce, protected resource” (252), rather than a public utility in the way we might now consider them to be.
Gates suggests that the advent of the personal computer and the development of Microsoft’s easy-to-use software caused this sense of scarcity “to give way to plenty” (252), and he explicitly connects this new abundance to the “hippie zeitgeist of the 1960s and early 70s” (256). He argues that many of the “hobbyists” he met during this time “viewed the Altair and the whole concept of the personal computer through a counterculture lens” (256). To these hobbyists, the personal computer “represented a triumph of the masses against the monolithic corporations and establishment forces that controlled access to computing” (256). These passages establish a clear dichotomy between the “hippie” hobbyists on the front line of personal computing and the government forces that once dominated the computer world. This dichotomy reflects the memoir’s thematic interest in the changing culture in mid-century America by showing how the computer industry moved from a place of government-controlled scarcity to a more democratic, grassroots place of abundance.
However, Gates’s depiction of himself as an early champion of this ethos is somewhat ironic in hindsight, given that Microsoft would later become one of the most powerful and monopolistic entities in the tech world. This contradiction complicates the memoir’s narrative, making it not just a success story but also a reflection on the unintended consequences of technological revolution.
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