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Meet the first new gTLD domainer

Kevin Murphy, February 4, 2014, Domain Sales

Gary Schultheis has bought hundreds of new gTLD domain names already and plans to buy thousands more this year.

Gary SchultheisThe former venture capitalist doesn’t consider himself a domainer, but analysis of Whois records and zone files over the weekend shows he very likely spent more than anyone on Donuts’ seven newly launched gTLDs.

At one point he owned about 10% of the .guru zone.

Schultheis’ new company, ii.org, is betting big — and long-term — on being able to sell from a large a portfolio of new gTLD names, he told DI today.

Right now, his investments are concentrated on .guru, where he says he’s picked up “hundreds” of names already.

DI research shows ii.org spent roughly $30,000 on a couple dozen generic .guru names in a single day last week, including exercise.guru, medical.guru, socialmedia.guru and divorce.guru.

“We’re not from the domain industry,” Schultheis said. “Folks I’m working with are either from the financial industry or the data industry. We’re looking at this from a smart, data-driven, black-box methodology.”

Most recently, Schultheis was president of TLO.com, a company that provided background research and risk management data services. He says that’s informed his strategy with ii.org.

“I like to take vast amounts of data and make decisions based on actual data, rather than speculation and guesses,” he said. “We may buy one-offs based on news-driven events but we try not to act emotionally.”

He’d rather not talk about the specifics of the company’s algorithms, but said they were tested out to create a portfolio of .com names, with mixed results.

Flipping some of these .com names will provide operating revenue, he said, adding that he has access to potentially millions of dollars in funding due to his previous work.

“If we have some .com’s that are industry or location specific, we have enough confidence we can sell those easily for cash flow,” he said.

“Our strategy is not to buy a million dollar domain and try to sell it for two million dollars, we’re going to buy things that will turn quick or have the potential for a massive multiple in future.”

But revenue from new gTLD sales may not come for years, he said.

“We have a five-to-ten year window on these and don’t care if we don’t sell any of these for years,” he said.

With that in mind, part of the risk of investing in “premium” strings with Donuts — which has earmarked many generic words for higher renewal pricing — is the high carrying cost.

“Click traffic is not going cover the renewal costs of these name,” Schultheis said. “gun.guru is going to cost me $400 a year to carry.”

Schultheis said as a venture capitalist in the 1990s he became aware of .com names and started buying up his own. That became International Internet Inc, which was publicly listed in the late 1990s.

Schultheis said the company (from which ii.org gets its name) was worth a billion dollars at one point, though it seems to have gone out of business around the same time as the .com bubble burst.

Now, he reckons new gTLD names will start to acquire Google juice before long.

“We own computer.guru,” he said. “If you type in ‘computer’ into Google now I believe .com’s will outrank it, but I believe over time that with the Google algorithm becoming more specific when you type in ‘computer’ as it relates to an expert it’s possible we could be as strong as .com.”

Of the seven ASCII gTLDS currently on the open market, .guru is the only one ii.org has touched. Schultheis said. In future, he intends to concentrate on where he feels the big-money buyers are.

“We’re very interested in some of the city names,” he said. “But ones like .sexy and .ninja are more for a college-age person, and I don’t feel that the audience there will show the return we’re looking for.”

By contrast .guru speaks to executive types and companies with money to spend, he said.

Without naming names, he said some other gTLDs confuse him.

“With some of these TLDs we really scratch our head and say ‘What were they thinking?'” he said. “There are dozens of these things where I don’t know how they’re going to pay the bills.”

As for ii.org’s outlook, Schultheis said its portfolio is going to be a mix of assets that he thinks could be sold quick and others that are long-term plays.

“We know we’re early. Everyone wishes they could go back to early 90s and buy up all the .coms they could,” he said. “But I also own some .mobi’s so I know you can also be wrong.”

NameJet to auction new gTLD domains before they launch

Kevin Murphy, November 8, 2013, Domain Sales

Many registrars are already offering new gTLD pre-registrations, now NameJet has taken the idea one step further: it’s going to auction premium names months before the gTLDs even go live.

It’s just announced a deal with XYZ.com, which is on track to run the .xyz and .college registries, to sell 40 “premium” domain names this month. In fact, according to its press relase, the first auction started on Wednesday.

These two new gTLDs are uncontested but do not yet have Registry Agreements with ICANN, and have not passed pre-delegation testing or any of the other pre-launch prerequisites.

The companies said they due to go live next year.

Some of the domains to be auctioned include: loans.college, scholarships.college, vacations.xyz, insurancequotes.xyz, students.college, jobs.college, auctions.xyz and health.xyz.

NameJet said it expects the auctions to be wrapped up by the end of February.

Second private auction nets $1.2m per gTLD

Kevin Murphy, August 16, 2013, Domain Sales

Only eight new gTLD contention sets were resolved during Innovative Auctions second round of private auctions this week, and the average winning bid has gone down.

The eight strings sold for a combine $9,651,000, or an average of $1.2 million per string. That’s down from the $1.5 million average reported from the first round of auctions in June.

The overall average winning bid from Innovative’s auctions is now $1.33 million.

Over 100 gTLDs had been committed to the second round by various applicants — which put up 68 strings and wound up winning three — but the auctions can obviously only go ahead if the whole contention set agrees to participate.

According to Innovative, these are the winners this week:

  • .guide: Donuts
  • .construction: Donuts
  • .storage: Extra Space Storage (applying as Self Storage LLC)
  • .desi: Desi Networks
  • .expert: Donuts
  • .fishing: Top Level Domain Holdings
  • .casa: Top Level Domain Holdings
  • .网址 (.wangzhi): Hu Yi Global

These were all two-applicant contention sets (Go Daddy had originally applied for .casa, but withdrew its application months ago).

Losing applicants — which get to take home the winning’s bidder’s cash, net Innovative’s fees — were Demand Media, Afilias, Dot Construction, and Red Circle.

The DI PRO Application Tracker will be updated daily as and when the losing applications are withdrawn. So far, only Donuts’ bid for .casa has had its withdrawal processed by ICANN.

Innovative seemed to blame the low turnout on the August holiday period, and said it has scheduled its third round of auctions for September 10.

Porn.com owner buys porn.xxx

Kevin Murphy, May 22, 2013, Domain Sales

PimpRoll, a pornography publisher and owner of porn.com, has bought the domain name porn.xxx from registry manager ICM Registry, it has just been announced.

The domain is already live. The site appears to be distinct from porn.com, but PimpRoll said it plans to build another “tube” site there.

The price of the domain was not disclosed, but PimpRoll is known to have paid $9.5 million for its .com address.

I’d guess we’re talking about low six figures for the .xxx, which was reserved by ICM as a “premium” name.

ICM said in a press release that the buyer will also automatically qualify for porn.sex, porn.porn and porn.adult under ICM’s Grandfathering Program, should it be awarded those gTLDs by ICANN.

Baseball league buys Rockies.com for $1.2m

Kevin Murphy, January 8, 2013, Domain Sales

Major League Baseball has purchased the domain name rockies.com for $1.2 million, according to the deal’s broker, Venture Capital Group Ltd.

The domain did belong to Tourism Canadian Rockies, which plans to move to CanadianRockies.org, according to the company. The Colorado Rockies is a baseball team in the MLB.

Domain Name Wire reported that the domain was up for sale last September, with Andrew Allemann predicting a sale to the MLB at price of $200,000 to $400,000.

According to Allemann, the MLB now only needs four .com domains to complete its collection of team names.

Rockies.com now redirects to mlb.com.

January 11 Update: The sale price of $1.2 million is now looking very dubious indeed.