The history of the development of the microcomputer industry since its inception in 1975 is explored in this brief paper, which pays special attention to the advent of the small business computer. The author describes the growth of sales, the development of successful companies, the early resistance to use of microcomputers in business, and the legitimizing effect of the entry of IBM, Hewlett Packard, and Xerox into the market in the summer of 1981. The characteristics required in an acceptable small business computer are described as (1) the presence of a CP/M operating system, (2) incorporation of VisiCalc or an equivalent electronic spread sheet forecasting system, (3) an 80-column display for effective word processing, (4) a typist's keyboard and a 10-key numeric pad, and (5) a total cost under $5,000. The author considers the marketplace developments of 1981 to mark the end of the "first era" of the microcomputer, ushering in a new era featuring new hardware, new software, and a new user profile. (Author/PGD)