We are told about the relationship between Mike and BOB by Mike (ep2 & ep9), when Mike says that he is similar to BOB, and that they were once partners. He then says that he saw the face of God, and was transformed, now intent only on stopping BOB. However, there is an alternative explanation... Mike says that BOB was his familiar, so BOB may originally have been Mike's lowly servant. It was BOB's job to collect fear for Mike in the BL. But BOB began to keep some of the fear for himself, and by feeding off the fear that he acquired he became very powerful -- powerful enough to inhabit humans outside of the BL. For a while, Mike enjoyed this, and the two became partners in killing, finding 'rich pickings' of fear in the human world and all the while increasing in power.
At first BOB still needed Mike to gain access to the human world. When someone read the FWWM tattoo on Gerard's arm, Mike would have the opportunity to move into the WL. Once there, Mike could invite BOB by reciting the chant himself. However, BOB's power continued to increase, and when he found Laura, who liked to play with fire, he no longer needed Mike, and began killing on his own so as to keep the fear for himself. Mike became fearful of the power BOB gained and realised that BOB would have to be stopped before his power exceeded Mike's own. Not knowing that BOB had an alternate route into the WL (Laura), Mike cut off the tattooed arm so that BOB would not have the opportunity to enter via Gerard. Mike never did see the face of God, that is just a cover story to enlist the help of Coop and the others in finding BOB.