The Early Years

By eweek  |  Posted 2002-05-16 Print this article Print

The Early Years

eWEEK:How did you start with the company?

Neukom:I started doing work for the company in 1979. The company moved up to Bellevue [Wash.]. Thats where the first offices were, in January of 1979. I was with the firm then called Shidler, McBroom, Gates—Bills dad—and Baldwin. And there were 13 [Microsoft] employees when the company came up from Albuquerque [N.M]. And Bills dad came into my office one day and said, "My son is bringing his computer software company up to Seattle, and we have the first opportunity to represent them. Would you be willing to do that?" Thats how it started.

By about 83 or 84, there was a team of us at the Shidler firm. There were probably seven or eight of us who were doing work for Microsoft, and I remember very clearly in late 84 early 85 I had this wonderful case that had been referred to me by a lawyer from another very good firm in Seattle. It was a classic trade secret case with a wonderful client, interesting issues and worthy opponents on the other side. And like most lawyers, I think, you always run nervous about whether youre devoting enough time to your clients work. I was particularly nervous about that case, and I finally realized some time in 85 that the reason I was nervous that I wasnt spending enough time on that case was because always in the back of my mind were these Microsoft matters, where I shouldve been spending more time.

Some matters I hadnt even yet opened files for, but I wanted to learn more about because they probably needed some lawyering.

eWEEK:What kinds of matters?

Neukom:These were licensing, piracy cases. The company was still a private company, so we didnt have public company sorts of issues. But it was a growing company and its crown jewels were its intellectual property, and that meant it was a legally intensive business.

And so in 85 I went to see Bills dad and said, "Look, I think we ought to have a discussion with Bill Gates and Jon Shirley [former Microsoft president] over at Microsoft to talk to them about whether theres a better way for them to manage their legal challenges and opportunities. I think its probably time for them to think about a law department." I went over and had a meeting with them, and I told them, "Youre big enough, youre a very legally intensive company, and youre going to continue to grow. I think you should consider whether you couldnt do a better job with more of a lawyering presence inside the company." They thought about it overnight and said, "Youre right." Then they made a mistake and said, "Since youve been heading up a team of outside lawyers for us, would you come inside and organize this group?" And I said I would.

eWEEK:How successful was Microsoft at that point?

Neukom:Its always been a profitable company, because Bill and Paul were always very frugal. They still are. We fly coach. And because were in the intellectual property business and from the first product—that Basic programming language product—the companys always had technology that was in demand. So by 85 we wouldve had Windows out, MS-DOS had had a successful profitable run already. Then in the spring of 86 we went public.

So the company enjoyed good profitability really from the outset, largely because Bill has this instinct about being very frugal and efficient and economical about how we do things, about getting smart people to follow his guidance as to where theres going to be a demand for technology and then building it. So from the get-go those themes: that its the technology that matters, we think theres a demand for this, were going to make it, well relentlessly improve it until we get it good enough so that it wins the reviews and the word of mouth and people really start to use it.

eWEEK:So, in that culture you were able to thrive? Microsoft is perceived to have this really driven culture.

Neukom:Some of thats true. There are two things. When youre inside the company, it feels like a first-generation company. It feels small, it feels scared, in terms of, "are we going to get the product out, is the other guy going to eat our lunch with a better product?" Its very much a first-generation company. Everything matters. You take things seriously. So to this day Im somewhat amused when I read about Microsoft the software giant, Microsoft the technology behemoth. Im not saying its inaccurate, Im just saying when youre inside the organization day to day, it just feels so different to me.

The other thing is that certainly for the technology people, the developer community inside the company, who create the intellectual property that drives the whole enterprise, that is the fountainhead. And nobody knows that better than Bill, but we all understand that. But even outside of that community within Microsoft, I think all of us feel a part of this technology culture.

eWEEK:How does it feel to be one of the old guys at Microsoft?

Neukom:I really dont think too much about that. I probably should. Maybe its my vanity, it wont let me realize how old and tired Im getting to be. But the positive energy level is pretty much a constant, and it tends to keep you young and engaged.

Theres one aspect to that that relates to the principles guiding our practice. One of the things where we think were helpful in LCA [law and corporate affairs], recognizing that people who are making very important, very complicated decisions at Microsoft are doing it at a much younger age than their parents. You can get people fresh out of graduate school, business school or computer science. And within a few years, because its a meritocracy over there, they can be in positions of real importance.

I say to people that Im hiring, "Youre going to like it here if you like lawyering, if you like technology and if theres a little bit of a teacher in you because youre going to have people in their 20s who have a lot of responsibility around this company who will come to you for guidance and they wont understand anything about the legal process, to say nothing about intellectual property rights law, or how you negotiate a contract or what a choice of law provision means or what its like to be in federal court. They havent had a divorce, they havent bought a house, probably havent had many traffic tickets. They dont know anything about the legal process, and its your job to help them understand how you can be helpful and that the responsibility we have jointly with those people is to see to it that we get legal rights built around the intellectual property." So one of the messages is we deal with a lot of amazingly smart, very well-educated people who just are very under-exposed to the legal processes.

eWEEK:What are you going to do going forward?

Neukom:In terms of lawyer work? In terms of my professional work Im going to take a sabbatical. I promised myself six months decompression, no new entanglements, just relax a little bit. In terms of community stuff, that will continue going forward. Im being an absentee chair of the Greater Seattle Chamber of Commerce right now. Im on the board of my alma mater at Dartmouth and they meet four or five times a year, and Im going to keep doing that. Im on the YMCA board in Seattle, Ill keep doing that. We have a family foundation.

eWEEK:Will you miss it?

Neukom: Ill miss a lot of it. Ill miss that virtuous cycle. I do count my blessings in the sense that I was just doing what a client needed to have done, which got me over to the company. Had no clue how important the company could become. I have friends that are better lawyers than me, better managers than me, better leaders than me, and they dont have nearly the job that Ive had. We dont pollute the environment, we dont abuse workers, we build communities, and we provide opportunity, a chance for people to achieve their potential.


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