Microsoft's New Groove

Once dismissed as a hidebound has-been, Microsoft is flying high. CEO Satya Nadella’s secret: a cultural reset that has lowered the gates to the software maker’s fortress—and cloud, cloud, cloud.

- Alex Konrad

In early 2016, two years into running Microsoft, CEO Satya Nadella needed advice from one of his newest employees, the co-founder of an app-tool maker Micro soft had just bought. Nadella was close to pulling off his blockbuster $27 billion acquisition of Linked In, but he wanted to talk about another company he coveted: GitHub. “Can we do it?” Nadella asked the executive. “Have we earned the trust?”

Back then, the answer was no. GitHub is the virtual watercooler of software development, a site where millions of programmers talk shop and share code across company boundaries. Microsoft had earned a reputation during its 1990s heyday as its polar opposite, an insular software belligerent, and GitHub was seen as wanting nothing to do with it. But after watching Nadella lead the Redmond, Washington-based giant for two years, GitHub made a surprise move, choosing Microsoft over Google as its acquirer this past June.

It was the latest coup for Nadella, 51, who’s breaking free of Microsoft’s recent past by returning it to its roots under cofounder Bill Gates.

“Bill used to teach me, ‘Every dollar we make, there’s got to be five dollars, ten dollars on the outside,’ ” Nadella tells Forbes, in his first sit-down interview since the $7.5 billion deal closed.

Great companies were once built on Microsoft’s code, Nadella says he was reminded by Gates. Nadella’s mission: Rebuild Microsoft brick by brick until it can happen again. “That’s what I want us to rediscover,” he says.