Paul Kedrosky has posted an item about an article on Microsoft co-founder Paul Allen in Bloomberg Markets, a magazine published by the financial data company, and as usual Paul has pulled out one of the most jaw-dropping facts from the multi-page article – and no, it’s not the part about Paul Allen’s 413-foot boat with the two helipads. It’s the part about how much the billionaire’s net worth has declined since he pulled away from Microsoft in 2000 and started diversifying his investments.
According to the Bloomberg piece (pdf link), Allen’s investment portfolio – the bulk of which was made up of shares in Microsoft – was worth $30-billion when he started selling his stake in the software giant and buying cable companies and sports teams and other investments. In 2003, his net worth had dropped below $13-billion. And if he had simply hung onto his stock in Microsoft and not sold? It would be worth about $78-billion, by Bloomberg’s estimates. I’ll wait while you pick your jaw up.
Obviously, $15-billion or whatever Paul Allen has now is more than enough to keep one man happy, not to mention enough to afford a sprawling “compound” near Bill’s that is worth about $130-million and a boat that cost about $200-million. Does he sit around and rue the fact that he could be worth $78-billion? That’s a question I don’t feel qualified – let alone able – to answer. But the Bloomberg article does talk about how he (along with his sister, who helps manage his investments) has started trying to prune some of his bad bets and make some more boring, financially-successful bets instead, on things like pipelines.
And why did he decide to sell off more than half his stake in Microsoft? Did he just want to diversify, or was there more to it than that? For what it’s worth, longtime PBS tech columnist Robert X. Cringely (real name: Mark Stephens) said recently that he heard from highly-placed sources that Allen started pulling away from the software company he co-founded not long after being diagnosed with Hodgkin’s lymphoma – and hearing Bill Gates and Steve Ballmer talking about how to get his shares back if he were to die. True? Who knows. But Allen has paid the price for that decision (along with some bad investment choices) even if he still has billions of dollars left.