‘A Significant Gift’
Giving for the benefit of mankind
Like many entrepreneurs, Bill Porter is a revolutionary thinker. Founder of ETrade, the first internet brokerage service, Porter’s company was responsible for the world’s first on-line trade on July 11, 1983.
Modest about his accomplishments, Porter says he simply takes what he sees and tries to make it work better–and that founding a company is more about having fun than making money. At 71, Porter is still having a great deal of fun, and his revolutionary ideas are not done with the industry yet.
“I just see something that makes sense to do and I do it,” says Porter, whose company, originally known as Trade Plus, began as a service bureau providing electronic quotes and trading services to giants like Fidelity and Charles Schwab. But Porter, himself an individual investor, began to see how computers could one day allow individuals to make their own trades online. ETrade was launched in 1992, and the company now serves more than one million customers and executes upwards of 80,000 transactions a day.
The success of ETrade has brought Porter and his wife, Joan, tremendous personal wealth, part of which they have now chosen to share with MIT. They recently made a $25 million gift to the Sloan School of Management to construct a new building, the William A. Porter Management Center.
“MIT is the leading technology school in the world,” says Porter. “Joan and I wanted to make a significant gift, and we looked at several different charities. But we felt the greatest leverage we could gain for the benefit of mankind was right here at MIT.”
“The building will foster a closer relationship between the management school and the technology side of the university,” he says. “There’s a great opportunity to exploit MIT technologies for the benefit of mankind. But technological developments are of no value unless they get managed and financed and marketed–through entrepreneurship.”
“Bill is contemplative in the technological sense,” says Joan, Porter’s wife of 15 years. “He’ll think about something very deeply, and then he’ll come up with an idea. He’s remarkable in how he sees the usual and says, ‘I think it needs to be changed.’ He sees the commonplace and says, ‘That could be done better.’”
Three years after retiring as CEO of ETrade, Porter is still coming up with ways to do things better. This spring, with approval from the Securities and Exchange Commission, he’ll launch his latest venture, a $90 million start-up of the first fully electronic trading exchange in the United States. The International Securities Exchange (ISE) will be the first new exchange registered in this country in 26 years.
“This is the only country in the world that still has floor-based exchanges with people running around,” says Porter. “What we really need is an electronic exchange that will move all these people upstairs to trade on a computer.
“This is a significant development for this country,” he says. “The rest of the world already enjoys the cost advantage of electronic exchanges. If I didn’t do what I’m doing, we could lose our financial centers over time.”
Despite his enormous respect for MIT, Porter says there was a time in his life when he wasn’t ready for it. Born and raised in Boulder, Colorado, he didn’t care much for high school so he ran off and joined the Navy at 16. “After that I decided maybe my Dad was right–I should go to school,” he says.
After graduating from Adams State College in Colorado, Porter earned a master’s in physics from Kansas State University. Years later, in 1967, after working at the National Bureau of Standards, General Electric, and Textron Corporation, he came to MIT as a Sloan Fellow.
“I was excited to be accepted at MIT,” he says. “It was an intense time, though, because everyone at Sloan works very hard.”
Porter says his time at Sloan gave him an understanding of how the business world works as well as an unshakeable sense of confidence. “Today I can sit and talk with the chairman of the New York Stock Exchange with no problem,” he says. “Before going to Sloan, I would have been very intimidated meeting someone like that.”
Despite his sense of confidence, Porter is modest about his success. “I’m only 71–I figured if I could live to be 150, maybe I’ll know how to do it right,” he says of the complex game of entrepreneurship. “There’s always plenty more to learn.”