Microsoft's 1986 IPO

raesene9

Interesting article but I'm not sure some of the statements chime with how things looked at the time (IME ofc).

I got involved in IT as a profession in 1995 and even then Lotus 1-2-3 and Wordperfect were going pretty well, so the idea stated in the article that :-

"a monopoly in operating systems and office suites was inevitable before 1990 was over."

seems a little overdone.

My memory of what really tipped it for Microsoft in the office suite market (at least in the UK) was that they started giving away a full office suite with every new PC. So even though competitors might have better functionality, it was a tough sell to get past the price of "free".

Definitely in the SMEs I worked in this was the reason that Office became the defacto option for office applications.

jimt1234

I started my career in '95, too, and yeah, as difficult as it is to believe now, Microsoft's monopoly wasn't yet assured. The OS market was pretty much locked up (OS/2 Warp???), but as I recall, Wordperfect was the big obstacle in the office-suite space. It had a massive userbase, especially in markets that were not friendly to change (law offices).

IMHO, the big boost for Microsoft was when they adopted the Lotus 1-2-3 and Wordperfect file formats. Now there was a product that costs less (free, with a new PC), and was compatible with all the existing docs/data. Game over.

scarface_74

1995 was the tipping point. Windows 95 came out and WordPerfect was late coming up with a good Windows app.

thr0w

In my memory (was young at the time), 95 coming out was such a huge event. Something about its emphasis on multimedia experience really changed the whole feel of the PC, at least for me. 3.1 was like this arcane puzzle, but 95 felt personable.

tiahura

By 95 it was game over. WP for Windows sucked. Quatro Pro was dying. Office 95 was the final nail.

cyberax

I was only starting working with computers as an unpaid IT help at that time, but I distinctly remember that MS Office was just better. More streamlined, and well-integrated.

Back then, pretty much everybody in my country just pirated the software, so the cost was not a consideration at all.

nine_k

MSO 97 was the pinnacle of usability and customizability per megabyte installed.

I only wish it were not so buggy when handling large documents.

aabajian

People play up Bill Gates’ connections, sure, but next to no 16-year-olds could program BASIC in assembly.

Microsoft’s success was as much to do with them being a programming languages company first. DOS, Windows 3.1, and even Windows 95 shipped with an interpreter and compiler for their BASIC and C, respectively. This empowered developers to use and write code for the OS out-of-the-box.

nine_k

Correct regarding the BASIC. MS DOS (and even MSX BASIC and MSX DOS) was pretty important though in the grand scheme of the ecosystem forming.

But neither Windows nor DOS shipped with a C compiler; it's not a Unix. DOS shipped with an IDE for BASIC, and compilers were available but not free. The more accessible option was Turbo Pascal (and then Delphi 1), Visual Basic was also popular but more costly.

GCC appeared in 1987 but only worked acceptably under Unix-like OSes.

bluedino

Microsoft shipped OSes with a crappy version of BASIC. But every computer did, before the PC came out.

LtWorf

Windows didn't come with any C compiler out of the box. And no basic either. Where did you get this idea?

Also qbasic was not the same as quickbasic, and it had a limit on the LOC and other limitations.

umeshunni

Something I find interesting about early technology IPOs is how early they IPO-ed compared to more recent tech companies and how much of their growth and value creation happened post-IPO.

- Microsoft IPOed in 11years, profitable and at a ~$800M valuation. They hit a ~$1T valuation in 2000. During the 90s, their stock roughly doubled each year, for a 1000x growth.

- Amazon IPOed in ~3 years, unprofitable and at ~$300M valuation. Their stock has 2200x since then.

- Google IPOed in ~6 years, proftiable and at a $25B valuation. Their stock has ~80x since then.

- Facebook IPOed in ~8 years, profitable and at $100B valuation. Their stock has 20x since then.

I think the ZIRP era led many companies to avoid going public, either because of access to easy money or because their financial didn't need to be disciplined enough. The high levels of pre-IPO funding also has led to many/most of them underperforming in the public markets.

pdq

A16Z had an article on the lack of IPOs:

https://a16z.com/where-have-all-the-ipos-gone/

Regulatory compliance like Sarbanes Oxley is another huge factor. And VC's having large capital pools make it easy for companies to stay private vastly longer without needing to raise funding from the public.

It's very unfortunate for the public markets, as basic only VC's and PE get access to high growth young companies. Now most of the growth is squeezed out by the VC's and the public gets just the tail end of mature companies.

justahuman74

I'm suprised the VCs aren't pushing IPOs more.

A lack of IPOs makes the startup life much less attractive than sitting around at a post-IPO company, which also means a harder time growing the startups the VCs are investing in

scarface_74

If you look right here on HN you will see how many gullible people think there equity will be statistically worth something.

You would be surprised how many true believers there are out there

gabrielsroka

Apple was the first company to reach a $1 trillion market capitalization, achieving this milestone in August 2018.

Microsoft reached a valuation of $1 trillion on April 25, 2019.

umeshunni

You're right. On Dec. 27, 1999, Microsoft's market cap hit hit $614 billion.

I might have confused it with some "inflation adjusted market cap" I read somewhere.

jodrellblank

That’s 1.175 trillion in today’s dollars according to https://www.usinflationcalculator.com/

jbs789

Yup. Strikes me as obvious that folks figured out how to get in there earlier rather than leave it to the public markets. Just sort of speaks to a combination of market efficiency plus increased regulation in my mind.

thwarted

> Something I find interesting about early technology IPOs is how early they IPO-ed compared to more recent tech companies

I am unable to resolve this sentence with the list that follows that has Microsoft IPOing significantly later in their life than the three others listed. Microsoft IPO'ed later compared to Amazon, Google, and Facebook.

jbs789

I think it’s not explicitly stated but consider the companies that have not IPOd and getting funding privately - I think that was his point.

pests

They mean that list compared to companies today.

canucker2016

Apple (AAPL) dropped down to $0.12 in Dec 1997.

27 years later, stock price hit its high of $260.10 in 2024 Dec.

2167x.

That's a mighty impressive run by Steve Jobs and Tim Cook.