The company was founded in 1978 by Mark Pelczarski as "MP Software" with its first product, a graphics program called "Magic Paintbrush". It evolved to "Co-op Software" as part of a sister company, Micro Co-op, then adopted the name "Penguin Software" in 1981 when software publishing became the primary focus. Like many other home computer publishers at the time, Penguin Software openly credited the developers of their games on boxes and title screens; developers that were often not direct employees of Penguin Software but rather independent designers that were paid royalties by Penguin Software for the games that sold.