Paul Allen, who co-founded Microsoft with Bill Gates, has died aged 65 from complications of non-Hodgkin’s lymphoma.

Allen’s company, Vulcan Inc., confirmed the news on its website and his sister, Jody Allen, said: “My brother was a remarkable individual on every level. While most knew Paul Allen as a technologist and philanthropist, for us he was a much loved brother and uncle, and an exceptional friend.”

Satya Nadella, Microsoft’s chief executive, added: “Paul Allen’s contributions to our company, our industry and to our community are indispensable.

“As co-founder of Microsoft, in his own quiet and persistent way, he created magical products, experiences and institutions, and in doing so, he changed the world. I have learned so much from him – his inquisitiveness, curiosity and push for high standards is something that will continue to inspire me and all of us at Microsoft.”

Allen revealed at the beginning of October that his cancer, which he first overcame in 2009, had returned.

Born in Seattle, Allen attended high school with Gates and the two bonded over their interest in computers. The two later went on to start Microsoft together in the late 1970s, though Allen later wrote in his memoir Idea Man that he effectively left the company in 1982 after he was diagnosed with lymphoma.

Allen, the son of a librarian father and teacher mother, was two years older than Gates but when they met in the computer room at the exclusive Lakeside School in Seattle in 1968, they discovered a shared passion. “In those days we were just goofing around, or so we thought,” Gates recalled in his 1985 book The Road Ahead.

Allen went on to Washington State University but dropped out in 1974 to take a job with Honeywell in Boston. While there, he pestered Gates, who was studying at nearby Harvard, to quit school and join the nascent revolution in personal computing.

Gates finally agreed and in 1975 the two jointly developed BASIC software for the Altair 8800, a clunky desktop computer that cost $400 in kit form.

The pair moved to Albuquerque, New Mexico, close to the Altair’s maker, and formed a company. It was Allen’s idea to call it Micro-Soft, an amalgam of microcomputer and software. The hyphen was later dropped.

Allen was in charge of Microsoft’s technical operations for the company’s first eight years, making him one of the handful of people who created early software such as MS-DOS and Word that enabled the PC revolution and thrust Microsoft to the top.

But he had ceased to be on the cutting edge of software development by the early 1980s. He never displayed the commercial instinct of Gates, who generally is credited with powering Microsoft’s rise to ubiquity in the 1990s.

Allen left Microsoft in 1983 after falling out with Gates and his new lieutenant, Steve Ballmer, in December 1982, only months after being diagnosed with Hodgkin’s lymphoma. As he recalled in his 2011 memoir Idea Man, he overheard Gates and Ballmer secretly plotting to reduce his ownership stake.

“They were bemoaning my recent lack of production and discussing how they might dilute my Microsoft equity by issuing options to themselves and other shareholders,” Allen wrote. Gates and Ballmer later apologised but the damage was done and Allen left Microsoft, although he remained on the board until 2000.

Allen recovered from his cancer after radiation treatment but in 2009 was diagnosed with non-Hodgkin’s lymphoma, another form of blood cancer. He went into remission in April 2010 but the disease resurfaced in 2018.

Allen held onto his share of the company. His 28% stake at Microsoft’s initial public offering in 1986 instantly made him a multi-millionaire. His wealth peaked at about $30bn in 1999, but Allen was hurt by the sharp decline in Microsoft stock after the bubble burst in 2000 and some unprofitable technology investments.

In October 2018, Forbes magazine estimated his wealth at $21.7bn and said he was the 44th richest person in the world. Allen, the owner of 42 US patents, liked to cast himself as a technology visionary who drove Microsoft’s early success and saw the future of connected computing long before the Internet.

“I expect the personal computer to become the kind of thing that people carry with them, a companion that takes notes, does accounting, gives reminders, handles a thousand personal tasks,” Allen wrote in a column in Personal Computing magazine in 1977, long before portable computers became a reality.

In the same year, he outlined an early vision of what turned out to be the Internet to Microcomputer Interface magazine: “What I do see is a home terminal that’s connected to a centralised network by phone lines, fibre optics or some other communication system,” he said.

“With that system you can perhaps put your car up for sale or look for a house in a different city or check out the price of asparagus at the nearest grocery market or check the price of a stock.”

A rock ‘n’ roll aficionado, Allen had a band on call to jam with when he wanted, and spent more than $250m building a museum devoted to his hero, Jimi Hendrix, which morphed into a music and science fiction exhibit designed by Frank Gehry.

Like Gates, Allen was a dedicated philanthropist, giving away more than $1.5bn in his lifetime and pledging to donate more than half his wealth to charity. Through various vehicles, Allen focused his giving on brain science, motivated by the loss of his mother to Alzheimer’s disease, along with universities and libraries.