Last Friday, Bill Gross, known as "Bond King," announced that he was leaving PIMCO, the Newport Beach bond fund manager he co-founded, to join Janus Funds (part of Janus Capital Group (JNS)). Although the departure isn't totally unexpected -- PIMCO's internal politics have been under the media's microscope since the sudden exit of Gross' presumptive heir, Mohamed El-Erian, in January -- it has jolted the investor community and the financial media. After all, Bill Gross was PIMCO, which oversees a stunning $2 trillion in assets.

Personally, I wasn't surprised to see him leave, but it's hard for me to understand wanting to start a career with a new organization at the age of 70. That, in turn, led me to look up Gross' net worth: An astonishing $2 billion! How did a man tasked with managing other people's money at PIMCO -- in boring old bonds, no less -- amass such wealth? Here are some of the milestones in that process -- and a few lessons to go along with them.

Think differently
Gross' background is somewhat atypical for a highflying investor. As an Angier B. Duke scholar, Gross majored in psychology at Duke University, rather than finance or economics. During his senior year, a car accident forced him to spend an extended bed rest at Duke Hospital, during which he picked up a book on blackjack. Once he was back on his feet, he headed to Vegas to test his newly acquired card-counting skills. In the space of three months, he parlayed $200 into $10,000, playing up to 16 hours per day and living in cheap motels or out of his car.

However, as Gross later commented: "The point wasn't to win money, but to prove I could beat the system." Nevertheless, he put the money to good use when he returned from serving in the Navy in Vietnam, paying for an MBA in finance from UCLA. On the back of his successful stint in Vegas, Gross had considered becoming a professional gambler, but he ultimately concluded that investing was a more socially acceptable field in which to apply the same skills and motivation.

An appreciation for the foibles of human psychology, combined with quantitative skills and a practical understanding of risk management honed at the blackjack tables, makes a superb foundation for a would-be super-investor. But Gross displayed a keen sense of risk and reward in his business dealings outside of the bond market as well. One brilliant career bet in particular laid the groundwork for his colossal accumulation of wealth.

Bet big when the odds are in your favor
In the 1970s, Gross began managing bond portfolios on behalf of institutional clients at PIMCO, a unit of the Pacific Mutual Life Insurance Co. in Los Angeles (PIMCO's first account was that of Southern California Edison, worth $25 million). By 1981, he had accumulated the kind of track record that gave him the confidence, along with two colleagues, to ask Pacific Mutual to allow them to establish PIMCO as an autonomous subsidiary -- and to give them a share of the profits. Pacific Mutual relented and handed PIMCO's new management a quarter share of the profits -- a figure that was later raised substantially.

"In retrospect, it was a gutsy move. They could have thrown us out of there," Gross told The New York Times in 1993. However, the other side of the negotiating table gave a different account of the situation, suggesting that Gross' gamble was anything but reckless; the odds were heavily in his favor.

Walter Gerken, the CEO of Mutual Life at the time, told Institutional Investor in 1998:

No CEO should have to go through this kind of negotiation more than once. ... You didn't have to be a rocket scientist to understand we didn't have the troops to put into PIMCO if they waltzed. The alternative was owning zero.

Similarly, Bill Gross found his advantage when German insurer Allianz (AZSEY) agreed to acquire PIMCO in 1999, securing a compensation package guaranteeing him $200 million over five years, on top of a $26 million payout for his ownership stake in PIMCO. (That turned out to be just an appetizer: Gross was reportedly paid roughly $200 million annually in recent years!)

"An obsessive tendency"
The other pillar of Bill Gross' phenomenal success is a drive that is rare even by the standards of the highly competitive investment management industry. In a 1993 New York Times article, Gross pointed with pride to PIMCO's growth and the fact that it had never yet lost a client due to poor service or performance. "It's my obsessive tendency," he offered as an explanation. That choice of words was not incidental.

That intensity was visible in his life outside of the office, too. In 1998, Gross told Barron's:

The ability of someone to stick with a regimen of exercise is a test of willpower. It's a statement that you can stick to an objective and get the job done. I've always thought of exercise as an investment in my life. My body should be able to endure the long-term race and be around for the long haul.

Gross was certainly willing to test what his body was "able to endure." A former marathon runner (he gave up due to his knees), he once ran from San Francisco's Golden Gate Bridge to Carmel-by-the-sea -- a distance equivalent to six marathons -- in six days. However, that proved to be an instance in which Gross' drive pushed him too far: As a result of that effort, his kidneys began to bleed, and he ended up in the hospital.

A fire that continues to burn
That last anecdote provides me with the best insight I can find for why a 70-year old billionaire would seek out a new employer after four decades spent at an organization he built. Mr. Gross is a natural, maniacal competitor who could not accept the idea that PIMCO was preparing to fire him. (At the beginning of the year, following El-Erian's exit, he tweeted that he was "ready to go for another 40 years!") If he can't lead PIMCO or leave on his terms, he has to compete against it.

The Bond King is dead, long live the Bond King!