Scott Banister

Last updated

Scott Banister
Born1975 (age 48–49)
Kansas City, Missouri
Alma mater University of Illinois at Urbana-Champaign
Occupation(s)Entrepreneur, investor
Known forCo-founder of IronPort
Spouse Cyan Banister

Scott Banister (born 1975) is an American entrepreneur, startup founder, and angel investor. He cofounded the anti-spam company IronPort, and he was an early advisor and board member at PayPal. He invented paid search advertising via keyword auction, a core business model for internet advertising companies.

Contents

Banister is a marijuana rights activist and was a supporter of Republican Senator Rand Paul in the 2016 presidential race.

Early life and career

Banister is the son of Debbie and Bruce Banister (1951–2006), a civil engineer who lived in Kansas City, Missouri. [1] According to Jimmy Soni,

Hailing from Missouri, Banister took to technology early. In high school, and then college, he kindled a passion for creating websites and came to UIUC because of its exceptional reputation in computer science... Banister also chafed against the confines of traditional education, and he began to treat college as a target to hack. He devised workarounds to UIUC rules, including an audacious scheme in which he created a company, hired himself as an intern, then used the internship to earn course credit. [2]

Banister's original intent in attending UIUC was to become a professor of computer science. Michael Ellsberg wrote that like other entrepreneurs, Scott Banister relentlessly looked at the outcome he wanted to produce in the world and relentlessly focused on how to achieve that outcome. [3] Characterizing Banister as a "self-educated serial entrepreneur", Ellsberg quotes Banister: "I found quickly that, by day I was going to class, learning a bunch of abstract, theoretical stuff, whereas by night, I was working on a business. I could see that business is how things actually get done in the world, and how people make money in the world: you build stuff, things that consumers want." [3]

Computerworld reported that Banister got his first idea to capitalize on existing search engine workhorses to help retailers advertise their presence on the Web. [4] He and friends posted a free registry service, ListServe, the precursor of Submit It!. [4]

In the summer of 1995, while still attending University of Illinois at Urbana–Champaign, Banister cofounded SponsorNet New Media, Inc., with friends, fellow students Max Levchin and Luke Nosek. [5] The three had set up office at the University's chapter of the Association for Computing Machinery (ACM), and the Department of Computer Science newsletter reported they had "installed a microcontroller on a vintage Dr Pepper vending machine and hooked it up to the internet so that students could buy soda by swiping their student ID cards". [3]

Outside the classroom, Banister had taught himself HTML, got a job as a webmaster working with faculty member Burks Oakley, and according to UIUC's Department of Computer Science, Alumni News, started three web companies: SponsorNet, the first advertising network and the first online auction for advertising space, Permalink.com, a provider of lifetime URLs and lifetime e-mail addresses, and Submit lt!, an advertising tool for websites. [6]

Banister was the first of the three friends to leave for Silicon Valley and the first to sell a start-up. [2] He left college during his sophomore year in 1996 to cofound Submit It!, the free, automated resource to advertise on multiple search engines. [7] Ali Partovi called it "a simple but elegant concept that turned out to be one of the best business ideas in history". [8] Submit It! was acquired by LinkExchange in June 1998, [9] and Microsoft acquired LinkExchange in December 1998. [10] Submit lt!, ListBot, and Banister's ClickTrade then became a part of MSN's LinkExchange. [6]

In December 2000, with Scott Weiss, Banister cofounded IronPort to stop porn from flooding corporate in-boxes. [11] The anti-spam company was acquired in 2007 by Cisco for US$830 million. [12]

Banister has worked with other start-ups as a board member and investor, including eVoice, the first email-enabled home voicemail service acquired by AOL in 2001. He served as VP of Ideas at idealab!, where he contributed the unique bid-for-placement search engine model that powers Overture. [8] [13]

He was an early investor in Powerset, a startup building a natural language search engine. His other private equity investments include Uber, Zappos.com, LiveOps, Facebook, Hi5.com, Tagged.com, iLike, Causes.com, Topsy Labs, Teleport, Inc. [14] and TekTrak. [15] Banister also cofounded Zivity, an adult-themed social networking site, with his wife, Cyan Banister, and Jeffrey Wescott. [11]

David Gelles has identified Banister as one of the PayPal Mafia, former board members of PayPal, influential investors in "a collection of some of the most valuable technology start-ups ever seen". [16] He invested in PayPal's earliest version, and he served as a founding board member. [2] In a 2019 VentureBeat article, Andrew Ganato and Scy Yoon wrote that Peter Thiel and Scott Banister had been the most prolific investors, each responsible for investing in more than 100 companies. [17] In that article, Ganato and Yoon provide a net graph showing the interconnections among PayPal Mafia members' investments. [18]

Personal life

Banister met his wife Cyan when she was managing IronPort's blacklist of spammers, and they married two years later. [11]

Banister is a marijuana rights activist, supporting legalization in Arizona and other states. [19] At UIUC, he served as president of the College Libertarians, and co-founded Campus Atheists & Agnostics. [6]

He was a supporter of Republican Senator Rand Paul. [20] In 2015, Banister donated $3 million to a Super PAC supporting Paul's presidential bid. [21] He later switched his endorsement to Ted Cruz after Paul suspended his campaign. [22]

Banister lives in Half Moon Bay, California. [23]

Awards and honors

Cyan and Scott Banister won the Angel of the Year Crunchie award at the 2016 TechCrunch ceremonies. [24] Jessi Hempel of Wired wrote that they "won TechCrunch's Angel of the Year award last spring for prescient bets on SpaceX, Uber, and DeepMind Technologies". [25]

In 2015, Eugene Volokh announced that the UCLA First Amendment Amicus Brief Clinic would be renamed the Scott & Cyan Banister First Amendment Clinic, "in recognition of the Banisters' very generous gift in support of the clinic". [26]

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References

  1. ↑ "Obituary for Bruce Banister". The Kansas City Star. August 12, 2016. pp. A13. Retrieved January 23, 2021.
  2. 1 2 3 Soni, Jimmy (February 22, 2022). The Founders: The Story of Paypal and the Entrepreneurs Who Shaped Silicon Valley. Simon and Schuster. pp. 11–12. ISBN   978-1-5011-9726-0. Before they met Levchin, ACM had also brought Nosek and Scott Banister together. Banister would become the first in their trio to set off to Silicon Valley, the first to sell a start-up, and an investor in the earliest iteration of PayPal, ultimately serving as a founding board member. Hailing from Missouri, Banister took to technology early. In high school, and then college, he kindled a passion for creating websites and came to UIUC because of its exceptional reputation in computer science. By the time he and Nosek first met, Banister also chafed against the confines of traditional education, and he began to treat college as a target to hack. He devised workarounds to UIUC rules, including an audacious scheme in which he created a company, hired himself as an intern, then used the internship to earn course credit. Iconoclastic, intense, soft-spoken, and with "Jesus-like hair," Banister became a guiding light for both Nosek and Levchin, and the three became fast friends and collaborators.
  3. 1 2 3 Ellsberg, Michael (September 25, 2012). The Education of Millionaires: Everything You Won't Learn in College About How to Be Successful. Penguin Publishing Group. pp. 203–204. ISBN   978-1-59184-561-4. Self-educated serial entrepreneur Scott Banister, who sold his IronPort Web security appliance company to Cisco in 2007 for $830 million, is a living example of focusing on outcome instead of output. Scott was studying at the University of Illinois at Urbana-Champaign in the late nineties, with the intention of becoming a professor of computer science. On the side of his studies, he began teaching himself HTML (hypertext markup language). He soon applied for and got a job as a webmaster, and then started various Web companies, including a banner ad company with college buddy Max Levchin.
    ..."I found quickly that, by day I was going to class, learning a bunch of abstract, theoretical stuff, whereas by night, I was working on a business. I could see that business is how things actually get done in the world, and how people make money in the world: you build stuff, things that consumers want... But very quickly it became clear, business is where I'm learning all the real skills that are going to help me for the rest of my life. And this stuff in class, I didn't even know when it is going to help me or anyone else, ever. I realized, getting involved with business sooner rather than later, as opposed to being off in this education bubble, which is very different from the way the world works, was incredibly important for me..."
    ...Scott Banister, and other self-educated success stories featured in this book, relentlessly look at the outcome they want to produce in the world and in their lives, and relentlessly focus on how to achieve that, cutting out all extraneous crap not relevant to that outcome. It's one of the key factors that distinguishes those with the entrepreneurial mind-set from those with the employee mind-set.
  4. 1 2 Radcliff, Deborah (May 8, 2000). "E-strategists: They are the brains behind successful e-commerce projects, the ultimate pitchmen. Consider the experiences of Scott Banister". Computerworld. 34: 92 – via Google Books.
  5. ↑ "SponsorNet New Media". Freebase. Archived from the original on January 18, 2012. Retrieved February 17, 2011.
  6. 1 2 3 "Scott Banister and Jonathan Stark: ACMers reunited at idealab!". Department of Computer Science, Alumni News. 2 (4): 14–15. January 2001.
  7. ↑ Gleick, James (May 5, 1996). "FAST FORWARD; Hall of Mirrors". The New York Times. ISSN   0362-4331. Archived from the original on January 29, 2021. Retrieved January 23, 2021.
  8. 1 2 Partovi, Ali (August 29, 2010). "Bubble Blinders: The Untold Story of the Search Business Model". TechCrunch. Retrieved December 1, 2020.
  9. ↑ "LinkExchange Acquires Submit It!". ClickZ. June 24, 1998. Retrieved January 22, 2021.
  10. ↑ Wingfield, Nick (November 5, 1998). "Microsoft Buys LinkExchange For About $250 Million in Stock" . The Wall Street Journal. Retrieved April 13, 2022. LinkExchange and its 100 employees will be integrated into the Redmond, Wash., software giant's MSN network.
  11. 1 2 3 Barret, Victoria (January 25, 2008). "You Get What You Pay For". Forbes. Retrieved January 23, 2021.
  12. ↑ Keith Regan (January 4, 2007). "Cisco buys IronPort for $830 Million". E-Commerce Times. Archived from the original on March 1, 2021. Retrieved May 21, 2013.
  13. ↑ Guth, Robert A. (January 17, 2009). "Microsoft Bid to Beat Google Builds on a History of Misses" . Wall Street Journal. ISSN   0099-9660 . Retrieved December 1, 2020. The roots of Microsoft's first paid-search foray trace back to 1995. The World Wide Web was just becoming popular. Small companies like Yahoo allowed users to punch in search terms to find content across the expanding Internet. That year, a University of Illinois student named Scott Banister hit upon adding ads to these search results. He quit college in 1996 and drove his Geo hatchback to California to start a company around his idea, which he called Keywords.
    In 1998, Mr. Banister joined Ali Partovi, a 26-year-old San Francisco entrepreneur who ran an online-ad company called LinkExchange. That November, Microsoft bought LinkExchange for $265 million.
    Microsoft wanted LinkExchange for its core business of distributing online ads to Web sites. But Mr. Partovi spent 1999 making monthly trips to company headquarters near Seattle to persuade his new bosses at Microsoft's online group to develop Mr. Banister's idea.
  14. ↑ "Scott and Cyan Banister". angel.co. Retrieved August 5, 2016.
  15. ↑ "iPhone Tracking Service Provider TekTrak Locates Seed Funding". TechCrunch. December 14, 2010. Retrieved March 1, 2011.
  16. ↑ Gelles, David (April 1, 2015). "The PayPal Mafia's Golden Touch". The New York Times. ISSN   0362-4331. Archived from the original on November 2, 2021. Retrieved January 23, 2021.
  17. ↑ Ganato, Andrew; Yoon, Scy (January 13, 2019). "A look at the PayPal Mafia's continued impact on Silicon Valley". VentureBeat. Retrieved April 13, 2022.
  18. ↑ "PayPal Mafia network graph". VentureBeat. January 13, 2019. Retrieved April 17, 2022.
  19. ↑ Sunnucks, Mike (October 23, 2016). "Techie investor who backed Facebook, Uber, PayPal pumps $200K into Arizona marijuana legalization". Phoenix Business Journal .
  20. ↑ "Silicon Valley's Libertarian revolution". Politico. Retrieved July 20, 2014.
  21. ↑ "Million-Dollar Donors in the 2016 Presidential Race". New York Times. August 25, 2015. Archived from the original on February 5, 2021. Retrieved October 14, 2015.
  22. ↑ "This top Rand Paul donor just made a big endorsement in the presidential race". Rare. February 3, 2016. Retrieved November 3, 2018.
  23. ↑ "Scott Banister - $2,274,206 in Political Contributions for 2016". www.campaignmoney.com. Retrieved April 3, 2022.
  24. ↑ Shivakumar, Felicia (2016). "Scott and Cyan Banister Win Angel Investor of the Year at the 9th Annual Crunchies". TechCrunch. Retrieved September 8, 2018.
  25. ↑ Hempel, Jessi (October 11, 2016). "The Venture Capitalist Who Is Both a Man and a Woman". Wired . Archived from the original on December 9, 2017. Retrieved September 7, 2018.
  26. ↑ Volokh, Eugene (February 18, 2015). "The Scott & Cyan Banister First Amendment Clinic". The Washington Post. Archived from the original on February 19, 2015. Retrieved November 12, 2018.
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