Microsoft exists because Paul Allen and Bill Gates did it while they were teenagers

A summer in high school, Gates worked for a company that measured traffic flows by counting the wheels of the car rolling on pressure-sensitive rubber tubes. Every 15 minutes, a machine perforated a pattern of holes on a piece of tape. This tape would be read manually and its results written manually. "The process was monotonous, inefficient and deadly on the eyes," Allen wrote.

Gates and Allen felt that this process could be done more efficiently and cheaply, an idea that quickly evolved into the first business of their friends: Traf-o-Data. At the time, Gates was almost 17 years old and Allen was 19 years old.

Gates began hiring younger students at Lakeside to serve as human paper tape drives, which would then copy the data from a tape to computer cards. Gates paid each student fifty cents a tape, Allen wrote.

Gates and Allen then used a computer from the University of Washington Library (where Allen's father worked) to create "easy-to-read" data tables on hourly traffic flows.

Finally, a third partner joined the company and built a machine to automate tape playback. They would then collect $ 360, or $ 2,300 in today's dollars, to buy a specially commissioned 8008 microprocessor chip for what would become the Traf-o-Data machine. "It's a lot of money for such a small thing," Bill said at the time.

With Traf-o-Data, the guys made it much easier to analyze traffic data from the Washington State Roads Department. Traf-O-Data then expanded, charging $ 2 per day for data collection to customers including small counties close to Seattle and a district in British Columbia. Allen wrote, "In this first wave of entrepreneurship, we had grandiose dreams about the money that reaches us."

The company ran for years and continued after the two men left high school, left college and even after founding Microsoft. However, just as the business was starting to expand, Washington and other states began offering the same service for free.

At that time, Allen said, he was concerned about running another company in Seattle with Gates – Microsoft. They reportedly raised nearly $ 20,000 for their work with Traf-o-Data, but the data collection project eventually failed. Allen said:

"In hindsight, Traf-O-Data was a good idea with a flawed business model.We had not done any market research.We had not expected how hard it would be to bring the municipalities to make capital expenditures, nor that officials would hesitate to buy machines from students. "

Despite Traf-O-Data's limited success, Allen said it was critical to get them ready to build Microsoft's first product a few years later. While Traf-O-Data was a commercial failure, he wrote in 2017, it helped them understand microprocessors, a knowledge "crucial to our future success".

"There was not our company Traf-O-Data," Allen said, "and if that had not been all that time spent on [University of Washington] computers, you could argue that Microsoft might not have happened. "

This experience laid the foundation for their technological success, Allen said. "From my experience, every failure contains the seeds of your next success – if you're ready to learn from it, Bill and I had to admit that our future was neither in the material nor in the traffic tapes, "writes Allen. "We should find something else."

Paul Allen died of cancer after yesterday at the age of 65. Gates said he was "torn" by the death of one of his "oldest and most expensive friends".

"From our beginnings at Lakeside School, through our partnership in creating Microsoft, to some of our joint philanthropic projects over the years, Paul was a true partner and a dear friend," Gates said in a statement.

Gates said: "The personal computer would not have existed without him."

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