The Silicon Valley legend talks about Intel, life before venture capital, and, of course, Moore's law.
FORTUNE — Gordon Moore has been present at the creation of three legendary companies of Silicon Valley. You could call him one of the founding fathers of the place. Yet he calls himself the ultimate “accidental entrepreneur.”
At 27, not long out of Caltech, he was recruited in 1957 by William Shockley, who was creating Shockley Semiconductor Laboratory. Shockley — he won the Nobel Prize for co-inventing the transistor but was a pariah by the end of his life because of his strident views on eugenics — had put together a dream team of young technical talent that included 28-year-old Bob Noyce. But Shockley’s stars couldn’t stand their boss, and before the year was out, Moore, Noyce, and six others — the “Traitorous Eight,” Shockley supposedly branded them — left. They launched Fairchild Semiconductor, which itself became a company to leave, in turn begetting dozens of companies. A decade after founding Fairchild, frustrated again by corporate inertia, Moore and Noyce themselves bolted Fairchild. Their next startup, in 1968: Intel, a leader of the microprocessor industry.
Moore, now 83, retired in 1998 to devote his energies to the multibillion-dollar Gordon and Betty Moore Foundation, which focuses on conservation, science, patient care, and life in the Bay Area. In his 30 years at Intel INTC , he served as CEO for more than a decade. Along the way he came up with what’s widely known as Moore’s law, which states that the number of transistors the industry can place on a computer chip will double every 18 to 24 months.
Born near Silicon Valley in a small village by the Pacific, Moore now spends most of his time on Hawaii. He and his wife of 62 years, Betty, do keep a stately home in Silicon Valley. There, in his study — surrounded by books, fishing photos, awards, and a giant floor-mounted globe — Moore recently spoke to Fortune’s David A. Kaplan. Moore reflected on a life well-lived in science, entrepreneurship, serendipity, fishing for deep-sea marlin, and philanthropy, and on joining Bill Gates and Warren Buffett’s The Giving Pledge (in which the super-wealthy agree to give away half their wealth).
He talked about Noyce, Shockley, Bill Gates, Andy Grove, and Steve Jobs — and that while he surely was unassuming, he was as fiercely competitive as any other early Valley rebel. Edited excerpts:
Q: As you look back on more than 60 years in the Valley, what surprises you?
A: Oh, no — we planned it all from the beginning! Well, I was initially surprised that people wanted the transistors we built back in the Fairchild days. And the development of the technology is so far beyond anything we could have imagined.
Was that something you stopped worrying about?
I had to worry a bit about it. I remember once giving a talk describing all the large increases in capacity we were putting in place and scaring the analysts, who wondered who was going to use all that stuff.
What about today?
I’m not close enough to it. I see the same things outsiders see: Intel putting in tremendous capacity, and the market is growing in portable devices, where Intel hasn’t had a very strong position. I read that there are more of those portable devices than people in the world. That’s unbelievable.
When you observe the Valley today, do you still recognize its culture, its values, its ethos?
I think so. It continues to evolve, but basically it’s still a place to do startups. A few become very successful.
Have the people changed?
They have generally different skill sets now. Software applications are where all the big deals seem to be. I don’t understand why things like Facebook FB and other social media deals get the attention they do — not being on Facebook myself, I guess.
When you are on the Internet, what are you looking at?
Usually my e-mail … I’m also great at solitaire. The computer is really a useful gadget for consuming time. I go to the New York Times fairly regularly. I read what they give me free.
Not a subscriber?
I tried to be, but I couldn’t seem to get through their system, so I said, “To hell with it.”
You grew up in Silicon Valley long before it was even called that, right?
Yes, in Pescadero on the coast, and then we moved to Redwood City.
After Berkeley undergraduate and a Ph.D. from Caltech, you went east after World War II?
There were no decent jobs in California. The aerospace industry, principally Hughes, and the oil refineries were about the only industries that were hiring technical people.
If it weren’t for Shockley, would you have wound up back here?
I was trying to get back. I was out for interviews at several places, like Shell Development and the Lawrence Livermore National Laboratory (to take spectra of exploding nuclear bombs). In fact, that’s where Shockley got my name. I didn’t want to do what they wanted me to do, so he got my name as somebody that had rejected their offer and gave me a call one night.
What was Shockley like on the phone?
He says, “This is Shockley,” like everybody would know who Shockley was.
You didn’t get a sense that Shockley would be impossible to work with?
No. I didn’t do a background check on Shockley — he may have done one on me … After a while, his less attractive traits came out. He sent all of us to spend a day with a psychologist.
How did you do?
Shockley let Noyce and me see each other’s report. Both of us were good technically, high IQs, but “no managerial capability.” Right, as it turned out. When we got Andy Grove [at Fairchild and then at Intel], he picked up the detailed management of things.
Mutiny and serendipity
How planned was your group exit from Shockley?
It was Gene Kleiner [who would go on to be a co-founder of Kleiner Perkins, the celebrated venture capital firm] who wrote a letter to his father’s investment house saying, “A lot of us like working together. Do you think there’s a company that would hire the whole group?” The investment house was Hayden Stone. And they sent two people out, one of whom was Arthur Rock. And they decided that rather than find a company that wanted to hire us, we ought to set up our own company and they’d find us financing — in those days, there was no venture capital.
And that led to the industrialist Sherman Fairchild [at the time IBM’s IBM largest individual shareholder]?
We took the Wall Street Journal, went down the list of all the companies in the stock exchange, and identified about 30 companies that might have an interest. None were interested. Then Rock ran into Sherman Fairchild, who was willing to take a flier. He wanted some nondefense business [for Fairchild Camera & Instrument].
So, had it not been for Shockley being the place nobody wanted to be at, and had it not been for Hayden Stone and Fairchild, you and the rest would never have birthed the culture of countless spinoffs that you did?
If it hadn’t been for a couple of particular events, I would have been off working for some other company or become a professor somewhere.
You weren’t chomping at the bit to start your own company, like so many entrepreneurs today are?
No, no. I define myself as the accidental entrepreneur.
Without Fairchild and its spinoffs, would Silicon Valley have still happened?
Insofar as you’re looking at the semiconductor industry, it’s much more likely to have grown in a place like Dallas, around TI [Texas Instruments TXN ].
Why didn’t things work out for you at Fairchild?
Noyce was the issue. I’ll put it that way. Fairchild fired two CEOs within six months. Noyce was the logical internal candidate, but they passed him over. I thought if they’re looking for somebody on the outside, things were going to change, so my job will change too. I’d rather do it before than after. So Bob and I decided to set up Intel.
You were 39 when you started Intel. You had relatively young children. Was it hard to leave?
I was pretty well off at that point. And Bob and I put in the initial money into Intel — a quarter of a million each. Arthur Rock put in $10,000 as well.
I thought Rock got a lot more early on.
That was all we’d let him in at that price!
The influence of Caltech
How important was Caltech for you? I assume a lot, since you gave the school $600 million [the largest gift ever to an institution of higher education].
Very important. I was only there as a grad student. If I’d gone as an undergrad, I probably would’ve flunked out. I think Caltech fills a unique role, and it’s not a cheap one. Their small size allows them to do interdisciplinary work a lot more effectively than anyplace else I know. The bigger universities get cast into silos.
Schools like Stanford and MIT?
Yes. At Caltech the biologists and the physicists have lunch together, which doesn’t happen elsewhere.
Woz and Jobs
Didn’t you know the Apple lads early on, when Intel was young?
I helped Steve Wozniak. His father called me wanting to know if he could get some memory parts for his son, who had a project. His father worked at Lockheed LMT . So I dug up some of our very first 1103s, our first dynamic RAMs, which Steve ended up with.
What about Steve Jobs?
The first time I met him was when he built a computer and brought it over to Intel to show it to us. We said, “That’s interesting.” But he had somebody else’s processor in the damn thing.
To the extent it didn’t have your processor in it, it wasn’t something that sounded commercially interesting?
It wasn’t clear what he was doing other than showing off his handiwork. You know, he wasn’t proposing any kind of an agreement with Intel.
How would he get a meeting?
We were pretty small then. Mike Markkula was one of our marketing guys who later became chairman of Apple AAPL . He put the first $100,000 into it.
So Intel is the father of Apple?
An uncle … I saw Jobs occasionally, but Noyce and Grove were both much closer to him than I was.
Noyce seemed to be a mentor to a lot of people.
He was the kind of person who you liked the moment you met him. He just had that charisma. I don’t have that. I’m much colder.
Can you describe in broad strokes the period when Intel became successful and the Valley came to be known as the Valley?
I have a very Intel-centric view of what was going on then. We were just getting started. Our first D-RAM hit the market in 1970, and the first microprocessor in 1971. We were a very small company, operating out of one small building in Mountain View. And then we got into the terrible recession of ’73 and ’74. Our business fell off a cliff. We didn’t yet have any enthusiasm for the personal computer.
So Intel’s embrace of microprocessors for PCs revolutionized the company?
You know about the oft-paraphrased conversation between Andy and me, when he asked the question, “What would you do if you came in from the outside?” And I think my answer was, “Get out of the D-RAM business.” It didn’t look like a good business for us — and we had the microprocessor thing going pretty well … It turns out to be more valuable to us than we would have imagined.
Venture capital and the market
You did well by Hayden Stone and Arthur Rock. But as venture capital proliferated and Sand Hill Road blossomed, did you have any reaction?
I had the feeling there was way too much money chasing deals. It really got way overblown for a while. Maybe it still is.
Your fellow “traitor,” Gene Kleiner, co-founded Kleiner Perkins. Were you let in as an investor to the early KP funds?
Your fellow “traitor,” Gene Kleiner, co-founded Kleiner Perkins. Were you let in as an investor to the early KP funds?
Yes. I think the only fund I missed was the one that invested in Google GOOG . I didn’t get my invitation or something, or was busy doing something else. A little ironic to miss out on that.
How did you feel about the bubble?
Intel was the most valuable company for a very short time.
When things were really frothy.
Those were the good ol’ days … [Laughs.] We were way overpriced.
What did you do with your stock then?
I didn’t rush out and sell. Financially, I should have. But it’s hard. I don’t think I’ve ever sold any Intel. I’ve given it away, but I’ve never sold any.
Moore’s Law, ambition, and legacy
You came up with Moore’s law at 35 for an article in a trade journal. How off the cuff was it?
I’ve discovered I was talking about it months before. It was amazingly predictive, not only on the rate of progress, but on the kind of products that were coming down the road. I mentioned home computers and phased-array radar. But I missed GPS.
Did you consider the article a big deal at the time?
It was one of those throwaway trade magazines.
And yet your obituary will mention Moore’s law in the first paragraph.
That’s right, and they’ll probably forget I was involved with Intel.
When will Moore’s law become obsolete?
No exponential goes on forever, and we’re approaching atomic dimensions. I’ve always said it will last two or three more generations [of chips], but the technologists have surprised me, so I guess they’ve still got some tricks up their sleeves.
You come across as more low-key, less ambitious than, say, Bill Gates or the Google guys. You wanted less to build an empire and more just to solve scientific problems and make products. Is that fair?
The low-key part is. But I’m probably more ambitious than I show. I’m still the longest-tenured CEO Intel has had — 12 years. I was longer than Noyce, longer than Grove, and longer than [Craig] Barrett. When Andy [Grove] got to the point where he looked like he could do the job better than me, I moved aside.
Marlin and trout and golf
You’ve got some wonderful photographs here in your study of you in a cowboy hat with some really big fish.
Here’s one of the biggest I ever killed [pointing]: a black marlin, 854 pounds, caught off Australia. I got the front couple of hundred pounds cut off. It’s out in the garage, actually.
Lots of business folks use golf as a metaphor for strategy, focus, competition. Does that work for fishing?
Why not? It’s better than golf for me. It was relaxing. I could forget about everything else. To me, golf would be an analogy for disaster.
Didn’t you once bring a rod and reel rather than a nine-iron to the most famous golf course in Ireland?
We went fishing in the pond on the course and caught a whole bunch of nice big trout. You’d hear a splash and you wouldn’t know if it was a fish or a golf ball.
I’m surprised you don’t do more fishing.
I damn near died two years ago. I spent three months in intensive care at Stanford, and it took a heck of a lot out of me. I used to go to some remote Pacific island for a week every year before I ran out of islands to visit. Now, I just don’t get around that easily.
Philanthropy, Bill Gates, and the road not taken
Why did you sign up for the Buffett/Gates Giving Pledge?
For me, it doesn’t actually change anything — I already gave away half.
How is your personal philanthropy different from the foundation’s?
The things I do personally are hard for the foundation to do. Education gets a lot of it, some science stuff. I pick up a bunch of screwy things.
Things like cataract surgery in Nepal — how does that strike you? I had cataract surgery a while back.
Mountain View. The person who did the surgery here was involved in the Himalayan Cataract Project. They’ve come up with low-cost ways of doing cataract surgery. They’re teaching local people. They give sight back to people who’ve been blind for 10 years. They can do several an hour. And from Nepal, they’re moving it into Africa. It’s just a humanitarian deal — I give a few hundred thousand dollars a year.
Is there much contact between your foundation and those of Gates, Packard, or Hewlett?
We work very closely with both Hewlett and Packard, and also have programs together with Gates. There are half-a-dozen foundations we have shared interests with.
Gates is known for wanting to measure results where it invests. It doesn’t want to be passive.
I feel that way, too, but it’s the hardest damn thing for a foundation to do. Most of the people who work in foundations don’t think that way. And Bill is a lot more hands-on with his foundation than I am with this one. You know, he’s quite a bit younger than I am, and also, I think, intrinsically has a greater propensity to be hands-on.
If you had a do over, would you start the foundation before you were 70?
I would have started it a little earlier because I transferred the Intel stock as the market was collapsing. If I’d set it up a year earlier, the foundation would be three times as big.
Isn’t it better now for the headline not to say THE RICHEST MAN IN CALIFORNIA?
Let Larry Ellison take the publicity.
You joke about missing the peak of the stock price, but I’ve heard you joke before. It sounds as if you’re smiling, but not completely.
Well, you know, that’s history. You win a few, you lose a few. On balance, I’ve come out okay.
This story is from the October 8, 2012 issue of Fortune.