Steve Ballmer, an American businessman and sports team owner, boasts a net worth of $145 billion. His wealth primarily comes from his 333.3 million shares of Microsoft, which account for roughly 4% of the company’s total outstanding shares. As the largest individual shareholder of Microsoft, Ballmer’s financial standing is a result of his substantial stake in the company. While Microsoft co-founder Bill Gates owns about 1.3% of the company, it’s Ballmer who holds the largest individual share.
Ballmer’s journey to wealth reached a significant milestone in 2024. On July 2nd, his net worth surpassed that of Bill Gates for the first time, driven by a 21% surge in Microsoft’s stock price. This remarkable achievement placed him as the world’s sixth richest person. It is especially notable considering that Ballmer wasn’t one of Microsoft’s founders. He was hired five years after Bill Gates co-founded the company with Paul Allen. Around 90% of his net worth can be attributed to his holdings in Microsoft. If Bill Gates had maintained a 30% stake in Microsoft, instead of selling off portions over the years, he could have become the first trillionaire by January 2024.
Early Life and Education:
Steve Ballmer was born on March 24, 1956, in Detroit, Michigan. His father, Frederic Henry Ballmer, worked as a manager at Ford Motor Company, which influenced Steve’s appreciation for the brand. Ballmer spent a portion of his childhood in Brussels, Belgium, where he attended the International School of Brussels from 1964 to 1967. Afterward, he returned to the U.S. and attended Lawrence Technical University and Detroit Country Day School, where he excelled in math and engineering.
Ballmer later went on to Harvard University, where he earned a degree in applied mathematics and economics, graduating magna cum laude in 1977. During his time at Harvard, he was actively involved in the football team and contributed to college newspapers. It was also during his college years that he met Bill Gates. Despite being a year ahead of Gates, the two bonded over their shared interest in mathematics and computing.
Career Journey:
Steve Ballmer’s professional journey took a significant turn in 1980 when Bill Gates persuaded him to join Microsoft. At the time, Ballmer was attending Stanford Graduate School of Business. He became Microsoft’s first business manager, marking the beginning of his long tenure with the company. Initially, he was hired without any equity in the company, but he was promised a 10% cut of the profits under his management. However, as Microsoft’s profits soared, this arrangement became unsustainable, leading Ballmer to negotiate for an 8% equity stake in the company.
In 1986, Microsoft went public, with a market cap of $780 million. At the time, Bill Gates owned 45% of the company, Paul Allen owned 25%, and Steve Ballmer owned 8%. Over the next two decades, Ballmer’s role at Microsoft grew significantly, and in 2000, he succeeded Bill Gates as the company’s CEO. Though Gates remained chairman, their professional relationship became increasingly complex, especially as Ballmer’s approach to managing Microsoft began to receive mixed reviews.
Microsoft Under Ballmer’s Leadership:
Ballmer led Microsoft during a period of significant expansion. He was instrumental in the company’s entry into new markets, including the creation of the Xbox division and the popularization of Skype. However, his leadership was also marked by missed opportunities. One of the most notable missteps was his dismissal of the iPhone, which he famously called a “waste of time.” Additionally, Ballmer’s acquisitions, such as Nokia, and products like the Surface, did not live up to expectations, leading to billions of dollars in losses.
Despite these setbacks, Ballmer managed to triple Microsoft’s sales and double its profits during his tenure. Nevertheless, the company’s stock value stagnated, and many criticized Ballmer for failing to capitalize on the growing smartphone and tablet markets. As a result of these challenges, Ballmer stepped down as CEO in 2013, announcing his decision to retire within the following year. On February 4, 2014, Satya Nadella succeeded him as CEO of Microsoft.
Acquisition of the Los Angeles Clippers:
In addition to his work at Microsoft, Steve Ballmer is also known for his ownership of the Los Angeles Clippers basketball team. Ballmer had expressed interest in owning an NBA team since 2008 when he was part of a failed group effort to acquire the Seattle Sonics. Later, in 2012, he attempted to buy the Sacramento Kings but was unsuccessful. However, in 2014, Ballmer had his opportunity when Donald Sterling, the former owner of the Clippers, was banned from the NBA for racist comments.
Sterling’s wife, who was seeking to sell the team, accepted Ballmer’s offer of $2 billion, and he became the Clippers’ new owner. At the time of purchase, the Clippers were valued at $2 billion, but they are now worth around $4 billion, reflecting the team’s growth under Ballmer’s ownership.
Dividend Earnings:
As a major shareholder in Microsoft, Ballmer benefits significantly from the company’s dividend payments. In 2024, Microsoft increased its dividend to $3 per share, meaning Ballmer receives an annual dividend payment of $1 billion. Over the years, Ballmer has earned a total of $13 billion from stock sales and dividends. His Microsoft shares are a cornerstone of his wealth, and he continues to benefit from the company’s continued success.
Salary and Compensation:
During his time as CEO, Steve Ballmer earned a base salary of $1.35 million. His compensation package also included a cash bonus of $600,000 and other miscellaneous perks, bringing his total salary to around $1.275 million annually. This relatively modest salary is in stark contrast to the vast wealth he amassed through his equity stake in Microsoft.
Real Estate and Investments:
Ballmer’s real estate portfolio includes several properties, including a $9.8 million home he purchased in 2020 in Hunts Point, Washington. This historic property, built in 1902, offers 3,790 square feet of living space and sits on roughly one acre of land. This acquisition was not his first real estate purchase in the Seattle area. In 1987, Ballmer and his wife Connie bought a nearby property for $1.325 million, which had appreciated significantly in value by 2020, with an estimated worth of over $12 million.
Additionally, in 2020, Ballmer purchased the Forum in Inglewood, California, for $400 million. This iconic venue had previously been home to the Los Angeles Lakers. Ballmer’s purchase was strategic, as it allowed him to bypass restrictions that would have otherwise prevented him from constructing a new arena for the Clippers. His ultimate goal is to build an 18,000-seat state-of-the-art stadium for the Clippers, which could cost upwards of $1 billion to complete. The stadium is expected to be ready by 2024.
