Monte brings on Success stories from MP3.com & Sex.com

[Commercials]

Monte: Hello, kids, welcome to Domain Masters. This is Monte Cahn, your host. Another great week has gone by. I'm still catching up from TRAFFIC Silicon Valley. I'm telling you; I'm like 300 emails behind and got a lot of work to do still and now getting prepped for SES in New York City and three shows back-to-back and then wrapping right back up into Domain Name Roundtable and TRAFFIC West in Vegas coming up here in the spring.

I have a couple really good guests on tonight. As you know, the largest domain transaction that's occurred in public, anyway, has been the sex.com sale, again, and we had the seller on a couple weeks ago, Gary Kremin and learned a little bit about the transaction. Today we're going to have the, I guess, the PR firm that was involved in the transaction and we're going to try to get some information out of Hal Bringman who is basically the front man for the Sex.com purchase site. But HBPR, which is Hal Bringman's company is also very well recognized for the most independent IPO's that have been done on a domain name, which was MP3.com and we're going to learn about that story as well, so it should be pretty cool to hear about this domain name that was purchased for $1,000 and was responsible for $400 million IPO when it went public and we'll learn a little bit about that from those guys.

And then I have my good old friend, Brian Benko on board. Brian spoke at the TRAFFIC Silicon Valley show. He just launched NoParking.com, which is a development site for domainers where Brian's company takes a stake in your domain name and helps you get it up off the ground and basically will turn it into a valuable piece of real estate. Brian's had a lot of experience in the Internet; he's also the President and founder of Back Bay Ventures and he was also one of the initial guys on the online advertising firm, First. And so he's got a lot of information and he's a domainer – he owns several thousand domain names, so it'll be great to hear from him as well and gets some good tools and tips and tricks out there that we can all learn from and help all of us out, be more successful on the Web.

So we're going to take a couple commercials. We're going to be right back on with Hal Bringman with HBPR and learn about Sex.com and MP3.com. Stay tuned.

[Commercials]

Monte: Hello, welcome back to Domain Masters. I'm Monte Cahn and as I mentioned we got two great guests on tonight. My first guest, Hal Bringman is founder HBPR firm and started very successful public relations firm in Las Angeles and the California area and has been involved with several successful transactions, particularly in the domain name side. One of which is Sex.com case, the sale that just occurred a few weeks ago and one of the more famous ones in the part that responsible for a very successful IPO was MP3.com. Hal, are you on board?

Hal: Yes, hey, how are you?

Monte: Great; how are you doing?

Hal: Very good.

Monte: Good, good. So I understand we got you on cell phone tonight so hopefully everything will be cool with reception. Give us a little bit of background about your business and about some of the companies that you've helped out and how you got started in it.

Hal: Sure. I was doing music publicity on the east coast and I moved to California right about the same time MP3.com went to launch, and I was looking for a project and Michael (Michael Robinson, the CEO) was looking for someone to help him out with the company for PR and I sort of launched accidentally my PR firm at the same time we launched MP3.com and we took them from launch to IPO a year later, which was a huge, almost $400 million IPO, and that was the beginning of a whole bunch market leaders in the digital music space that followed MP3.com. We worked with Music Match; we launched Napster, Rockster, P-to-P, Slugster which is another P-to-P overseas. So that sort of has been sort of our niche market is digital media for the time period since we launched MP3.com and now with Sex.com acquisition, we have a very cool company there. We don't have a lot to talk about with it now but its sort of going to be a social networking, you know, user generated content site that I think is going to take the adult industry to a whole new place that it's not been before.

Monte: Right. So, give us a little bit of insight on the Sex.com purchase of what you can share. I know it's . . . still a lot of stuff in confidentiality and whatever. I had Gary Kremin on the show a few weeks back and he talked about the sale side of it a little bit. So, just give us some of the details that you can share about the purchase, how was it structured, that kind of thing and then maybe you can just share with us a little bit more about how that portal or that domain is going to be different than what it currently does today, which is basically kind of an advertising feed into the Grant Media, or what it did anyway for Grant Media Advertising Network.

Hal: Yeah. It was, you know, for the most part it sort of has been kind of almost just a static billboard, if you will; and . . . we're assembling a world class management team right now which is one of the reasons why we're just not really ready to talk that much about it because we want to find the right voices to tell the story. But its going to be a very . . . you know, a lot of adult sites in particular, you know, like Playboy for example, is they're pushing their particular content and what we want to do is really embrace the Internet and the power that it has behind user generated content and you know, video has been something online that's been much talked about but not terribly successful in the past but with broadband being a reality today, video online is very compelling and user generated social networking kind of thing, an integration of all those different things are going to come together and really create a new kind of site . . . it's sort of like back in the day of MP3.com, the artists that made the most money on that site were the ones . . . you know, the cream rose to the top; the artists that were putting out the best music rose up the charts. Well, the kind of content that's going to be the most successful on Sex.com is going to be the stuff that, you know, is the most popular and is community driven. So, instead of just having somebody of this content push at you, its going to be content that is partially created by the community itself.

Monte: Oh, okay. So, so it sounds like it's going to be a little unique that, that . . . in that way and its going to be constantly changing, so therefore there's going to be fresh content all the time and it's going to be dynamic in nature and be different than the other types of sites that are like it today that are out on the market.

Hal: Absolutely. I think its going to really take the adult business to a whole different level.

Monte: Right. Now, from the purchase standpoint, you know, cause it was a pretty pricey play . . .

Hal: Yeah.

Monte: . . . how are you guys going to be able to justify the cost and you know, the initial cost of it and how's the model going to be run going forward to help get some of that money back? I mean, is it going to be like a join fee or is it all going to be done through advertising or you know, what's the 30,000 foot view on the business model?

Hal: Well, its really going to be a matrix of different things, you know, largely advertising-driven but you know, a bunch of different approaches. So we're very excited about it and looking forward to announcing the management team soon.

Monte: Okay, great.

Hal: Justifying the price, though, is easy though because you have to remember the 6 million people, 6 million uniques come every month and you know, just off of advertising alone its easy to justify the price but there's so many compelling business models. I mean, just what we could do in creating some kind of television thing, because there's been a lot of interest in different kind of TV outlets from the Sex.com brand. You know, it's a whole new day for Sex.com. We're very excited about it.

Monte: That's great, that's great. Well, congratulations on that purchase and I'm sure you guys will do a great job. So, lets shift over to the MP3 story a little bit because this is kind of dynamic story and I think a lot of the domainers can learn a lot from this is that I think that name was originally purchased for like $1,000 from the guy who originally got it from someone else, is that correct?

Hal: Yeah. It's really a great story. Michael Robertson, the CEO, had a consulting firm that sort of analyzed Web traffic and he saw that MP3, you know (you got to remember that this is back in 1997, before MP3 was . . . the format was really popular or known) but he could see that there was this huge spike in traffic happening and so he wanted to have that domain and the guy who owned it, as I understood it, kind of registered it by accident. I'm not even really certain that he knew he owned it and that's a whole other story that we can go into another time, So Michael approached him and said I really want to have this URL and the guy had no interest in it, so he was like, yeah, sure, for a thousand bucks you can have it. So, I mean, imagine it. You buy this website for a thousand dollars and not much more than a year later you take it public, you know, and raise something like $385 million.

Monte: Wow. Wow. That's great, that's great. So, in the year that the domain name was purchased to the concept of raising capital and then turning it into a real piece of property, what kind of things happened back at the company to get into that kind of position? Like, if you're a domainer and your wanting to do something – not similar because that's a pretty big IPO, I guess – if you're wanting to bring a domain to market, what are some of the most important things that you know that someone can do, you know, to get into the position to be successful like that?

Hal: We believe in a very gorilla, organic kind of approach. And, you know, domain Internet real estate is a . . . having a Sex.com or MP3.com; I mean obviously that gives you a great advantage because people are just going to by default come to your site. But at the end of the day you also have to have a compelling business model and we just believe very much in a very hardcore gorilla, organic kind of approach to things and being very smart and moving very quickly.

Monte: Now, what do you mean, “Gorilla” and “organic”? Go into some detail behind that so the people know what they're . . . what they should be doing in their own businesses.

Hal: Well, like, personally speaking, I'm not a big believer in advertising. I think that the money that people . . . not that it doesn't have some value, but some people, you know, will take sort of a (for lack of a better word) lazy approach and just think that spending a bunch of money on advertising is the way to establish their brand but I think its about doing the right kind of strategic alliances with companies that can help, you know, bring their community to yours. You know, one of the most famous [inaudible] companies here in Hollywood with Miramax brand and what the Weinsteins did that made them so successful was instead of blowing their films marketing budget, which are huge budgets to begin with, on a lot of advertising, they always did a lot of gorilla PR and would find the story behind the movie or you know find the controversial hook. You know, a lot of the press . . . we just got so much press on MP3.com because we were very controversial and you know, we would find the way to poke holes in the music industry's business model or the way they were treating artists and we would go talk to the press about that and you know, we would try to shine a light on these issues and raise the controversy and that would just only drive the traffic that would drive new artists, new customers, you know, and at the end of the day didn't really cost us anything.

Monte: Right, right. So, so, that goes back to like any press is good press and even if its controversial and it doesn't cost that much, you're then looked to as an expert so then you're called upon to give your opinion when you made a stance that you are an expert in the field, I guess.

Hal: Exactly.

Monte: So that . . . so when somebody else wants to give an opinion, then you're brought back up again and then MP3 is back out in the marketplace again, I guess.

Hal: Right.

Monte: So, so, how did you bridge the gap? How were you able to take it from a domain name, though, and to successful IPO and then get the artists and everybody to jump onboard onto this thing, because that's one of the most challenging, I guess, hurdles to, you know, get the acceptance and then roll it out into a successful business model.

Hal: Yeah. One of the strategic advantages we had was being first to market, which is sometimes you only end up educating the market and then somebody with a bigger checkbook comes along and does it better but in our case being first to market really was an advantage that we had that stayed an asset of ours. And at the time, there wasn't really anybody pointing a finger at the music industry and telling them or showing them how it could be done better. You know, its great that iTunes is wildly successful now but principles behind iTunes were things that we were advocating with MP3.com back in 1997 but the record companies didn't want to license; you know, they were trying to find a way, we always believed, to do it themselves rather than, you know, partnering with other companies . . .

Monte: Right.

Hal: . . . so, you know, I think that that was a major advantage that we had was being the first people out there causing a ruckus. And then, you know, Napster came along and the whole P-to-P world became so dynamic that it sort of . . . the whole MP3 format sort of took a back seat to the bigger issue of file sharing.

Monte: So what's going on with MP3.com right now and are you still involved?

Hal: Oh, no; I mean, that thing has been bought and sold so many times that its staggering. I mean, [laughs] if you add up the total dollar amount that that company has, you know, seen come and go from acquiring and selling it, it's a staggering number. First of all, we had an IPO that was somewhere around $375 million; then the Vendi Universal bought it for, I want to say, like in the neighborhood of $300 million and then for an undisclosed sum CNET Networks bought it off of the Vendi Universal and they still presently hold it. They sort of took an artist's approach with it in trying to apply the same business model behind MP3.com. I'm not sure its worked that great for them but they're a great company and so . . .

Monte: Any, any idea what they actually bought it for?

Hal: You know, it was . . . Vendi Universal had been in a lot of trouble at the time because they had placed way too many bets on the Internet and they didn't really have any smart people running any of it, so it was all just sort of floundering and they just needed to further stock the shareholders, they needed to sell and liquidate stuff so you know I have a feeling that CNET probably got a pretty good deal.

Monte: Right, right. So, so, anyway, with the couple transactions that are known, you know, you're up to $700 million or $800 million right there on the spot, so its possible that it's close to a billion dollars with this thing that's been traded back and forth on just since the initial public offering, huh?

Hal: Which is crazy, isn't it?

Monte: Yeah, it is crazy, for a name, if you think about it; for a name that was bought for $1,000.

Hal: Yeah . . .

Monte: Well, originally was registered for, you know, $35 and then bought for a thousand bucks.

Hal: Right.

Monte: Yeah, definitely. So, tell us a little bit about your firm and a little bit about, you know, what domainers should do to, you know, really put a stake in the ground and be successful in their business. You know, taking all your experience, cause you're obviously involved in a couple major transaction here and have a lot of experience so I have an audience here of several thousand domainers that listen in or pod cast this broadcast and the whole goal is to have people learn something. From your background, you're a successful public relations firm. Walk us few a couple things that are an absolute must that people should be doing with their properties, you know, to be successful.

Hal: Yeah. We've been doing a, sort of, traditional business model for quite a few years and then last year we spun off a new company, a new venture PR, which is NVPR.com and The New York Times did a feature story on us because of the sort of innovative approach that we were taking because so many times we would be approached by people that had, you know, either a great domain or a really great business idea but maybe they were undercapitalized or didn't have, you know, VCs lined up yet because they didn't know how to take that next step to get the market's attention. So we launched a division of our company, NVPR, that takes equity, if we find a company that has what we think is a compelling enough business model that it just needs, you know, a lot elbow grease behind it and that we think can either raise money or be acquired; then we will partner with the company and in exchange for equity we will you know do business development PR. Whatever needs to begin it we kind of consider ourselves founders for hire and whatever it needs to be done, you know, obviously PR and marketing is our specialty, but you know there's other things that we can contribute such as doing business development relationships, then we do that. And then we partner with the companies and just try to make as much noise and get as much stuff going as possible. And, I, you know, the CEOs, you know, like Michael Robertson of MP3.com and for [inaudible] a rental company called Zingy, which we sold for $100 million to a Japanese company, these people, the traits that I can say, among them that were consistent is just really being tenacious, hardworking, smart people that moved very quickly. Instead of getting bogged down, you know, by committee, they were just very, you know, strong CEOs that had a vision and executed on it very quickly and I think that's absolutely critical.

Monte: So, so, executing very quickly, being tenacious out there, I mean, what are some other things though, because you guys have been involved in a lot of stuff and I mean, what do you have on your plate currently?

Hal: Well, podcasting is a really hot space and we have had quite a few successful things in wireless as well, so we had gone around and met with a lot of the podcasting companies and were kind of surprised that none of them had a unique business model. They just, you know, it was just another podcast site, another podcast directory and you got to ask yourself how many of those do you really need? So, we came back and talked to some of our developer friends and said, look, podcasting is really hot; you guys have got this really great background in developing stuff for wireless; lets figure out a way to marry podcasting and wireless, you know, two of the hottest sectors out there . . .

Monte: Yeah.

Hal: . . . so PodtoMobile.com is a soft wood that allows – you know, not everybody can afford an iPod, so, and everybody's got a cell phone in their pocket, so we, they designed the software so that even the most basic handset with the most basic Internet connection can be literally sort of transformed into an iPod and you're favorite podcasting can be streamed to your phone. So you got your ear buds, your headset, whatever, you know, when you're on the subway, you can pull via streaming, podcasts onto your cell phone. The software [inaudible], it works on most major carriers, its still free and we're getting ready to launch an advertising solution that we think will get a lot of attention and that's one of the main things that we're focusing on right now.

Monte: Oh, cool. That's sounds really . . . that sounds really good. And so, tell us little bit about when you do find one of the companies or one of the people that you want to work with, do you leave the current management team in place or do you come in and step in as managers if you like the concept? How do the rules of engagement go with your firm and those that might be interested in engaging with you?

Hal: Uhm, we usually to stay out of their way; you know, we're there to be support rather than to, you know, come on board as management. I mean, we're always open that if it was the right opportunity but I think the more synergistic way is for us to provide support to what the company already has going and provide counseling guidance on what is the most strategic way to go about executing, you know, their business plan. So, it, it . . . we come in as consultants and you know, help them fine tune their strategy, make sure that they're very focused and you know, determine what the correct market it to go after and then figure out what the story is that is going to sell that concept to the market to make VCs and the media pay attention. You know, in a lot of these companies that we have come in and spanders on, the general incoming emails, like [inaudible] come from, we copied on that and that to me is like heroin, because you know, you know, if you get a bit piece in the The New York Times or The Wall Street Journal and you just start seeing those emails floating in of people that want to partner with you, you know, that is like a drug to us because it lets us know that we're on the right path and that we're bringing value to the company cause we're making their phone ring and their email hum with new business and at the end of the day, that's what excites us.

Monte: Right, right. Any other last pointers or tips and tricks that people can take away from your experience and things that have made you successful on the Web?

Hal: You know, I think its really about embracing your community and treating them well. You know, don't disrespect or insult, you know, your audience by spamming them too much or you know, talk to them in a respectful kind of way. I think that in embracing the community and making them, you know, be excited about your company as you are only helps propel the company and I think sometimes they end up talking at their customers instead of with their customers.

Monte: With their customers, right, that's a key point. We try to reach out to our customers for improvements and try to have our systems and our process as built around what the customers have been telling us instead of what we're telling them, that's for sure.

Hal: Yeah, yeah, you want to try to establish that one-to-one relationship; its so critical, I think.

Monte: Yeah. It's hard, it takes a lot of energy and time, but it is, it's actually critical to our business, being on the Web and have running an ICANN accredited registrar and a domain services company, where everybody kind of looks the same to everyone. The one difference is that we look people eye-to-eye, face-to-face and build relationships and trust that way.

Hal: That is so important; its critical to success.

Monte: Yeah, definitely. Well, Hal, I really appreciate your time. I know we kind of got you on the go and really appreciate your input and the MP3.com story and we all look forward to seeing how Sex.com evolves into a great site and a great investment for you and your firm.

Hal: Thank you so much.

Monte: Great. And I'll speak to you later and thanks for your time.

Hal: Bye-bye.

Monte: Okay, bye-bye, Hal. Alright, great, hang on for a couple minutes. We're going to do another commercial and we'll be back on with Brian Benko from NoParking.com and learn about some other website development opportunities out there for those of you that are looking to develop some of your domain names and would like some experts helping you out. Stay tuned.

[Commercials]

Monte: Welcome back to the show. My next guest, Brian Benko, has been a domainer for a long time. I was fortunate to meet this gentleman at the TRAFFIC East conference about a year and a half ago or so. And was very intrigued with the number of domain names that they owned and their business model and Brian's certainly taken his experience and has launched a company and a vehicle called NoParking.com. You can kind of get an idea from the name what it means and that is, don't just take your domain name and park it; really take your domain name and do something with it and develop it and put it in the hands of people that do know what to do with so that its just not sitting there collecting dust. I mean, a lot of people make money on parking domain names and earn PPC revenue, which is great, but you could take some of your domain names and actually turn them into real properties and have them become very valuable. And Brian has a lot of experience and in the domain field, and also the online marketing and advertising field. He, again, was with the online advertising firm, First and while at First he created and managed online initiatives for clients such as eBay, Yahoo!, The Globe, Ditech, Microsoft, so he has a lot of experience there. And now they have a kick-ass portfolio and he's a great guy and somebody I can call a friend and also an advisor to the industry. So, Brian, welcome to the show.

Brian: Hey, thanks, Monte, appreciate it.

Monte; Yeah, and so you were fortunate enough to have a little time on the panel at TRAFFIC Silicon Valley and talked a little bit about your guys development effort. Tell us a little bit about . . . first of all, give us a little bit of history about how you got into the domain name business and some of the key properties that you and your firm own and then lets walk right into NoParking.com and the concept behind it, how people can get involved.

Brian: Sure. My original beginning started with my experience with Burst Media where we were selling advertising media on about 3800 domains and that was my first intro to the Web in terms of marketing and the value of a domain, so a lot of what I took from that is just understanding the value of a domain and content with reference to advertising and after that I started an ad server company which was called AdServer with a partner of mine. And that was when we kind of figured what kind of worked online. It wasn't domain development related but but it was more of online advertising agency with online tracking using the ad serving software that we had built.

Monte; Right.

Brian: And so that allowed us to figure out what worked. And after the bubble popped or burst, we, or I, realized that we should have been building our own sites and promoting those sites with our online marketing skills and that's where I started buying domains and developing domains and from there, its turned into what we have today, which is a fairly good sized portfolio with developed properties that do pretty well and the idea behind NoParking.com is that its just an entity that we thought up, or that I thought up, that its just an option. I don't . . . as I said on the panel at the TRAFFIC conference, I don't want people to think that its an absolutely must or that I think that parking is a bad idea. I think its an option that some people are very interested in having their domains developed but are . . . are certainly not interested in hiring a staff or building up the property themselves. It's just an option for really valuable generic domains that might not have tremendous amount of type in traffic but everybody knows that developed out they're worth a tremendous amount of . . . they're worth a lot and its easy to get advertisers or other revenue generating sources to pay the organization just because of the domain.

Monte; Right, right.

Brian: A lot like what Brian Noll said with Golfcourses.com; you know, it allowed him to get – or actually OfficeSupply when he was on the panel the first time . . .

Monte: Right.

Brian: . . . just the domain allowed him to get somebody to call him back or enabled him . . . gave him the power to get on the phone with other industry leaders and that's, again, what a good domain can do.

Monte: Yeah, definitely. And name some of the properties that you guys have been very successful with because, I mean, actually one was so successful that when you told me about it, I actually ordered a bed from you personally because it was, you know, you told me about the business concept and everything. But, I mean, talk about some of the successfully domains that you guys have been able to develop and turn into real profitable websites and why and what kind of work was involved to get them to where they are?

Brian: Well, the company that you're referring to is Abed and Dormia.com, which are not companies that we own or I own outright.

Monte: Right.

Brian: They were originally a client . . . of Abed.com was originally a client of mine at when I was at Burst Media and they were . . . Mike Supelli, the CEO, was very early on in adopting the Web and he was online in 1996 with Abed.com and some other properties as well. And so cold calling I ended up meeting Mike Suppelli from Drew Burst Media and then stayed in touch with him for a long time and then they acquired a mattress factory down in Maryland and he needed help with the online strategy, so I came onboard to help him run and manage Abed.com as well as Dormia, which we launched, or I launched, with the help of a couple other people, which was the brand that we launched, which is the mattress that you have. And through the process of managing his properties and looking for traffic that monetized well, I was leasing domains and actually he had, was leasing a domain prior to me getting there as well, which was Bed.com and then we were leasing another one, which was Mattresses.com and those, they converted pretty well. It wasn't a tremendous amount of revenue that was bringing in but it did have a nice conversion rate and the leasing price was below the profits that it was generating so it was obviously effective (or not) but it was obviously an effective advertising campaign for us. That was my first experience in building out a property and doing very well and we had the revenue up to 7 figures a month at some points during the early stages of buying Pay Per Click traffic and Search Engine Optimization and then after . . . properties that I own outright would be properties like FindADentist or LasikEyeSurgery.com and . . .

Monte: Right. Now what's FindADentist and the other domain names doing now?

Brian: How are they doing or what are they doing?

Monte; No, what are they doing and how are they doing?

Brian: Well, in terms of what they do – FindADentist business model or revenue?

Monte; Yeah. FindADentist business model.

Brian: I got ya. FindADentist is an industry that I chose because there's a major player and really only one major player – 800Dentist, which really didn't have a large online initiative when we launched FindADentist a few years ago. So I thought it was a space that was a lot like the rest of the world back in 1999 or '98; they weren't really sure how to . . . not how sure to get online but where to market or where to advertise or what would work or what wouldn't work and I felt that the dental industry was in the same place a few years ago (and still is actually – they're very far behind the curve as many industries are) in terms of using the Web to generate business. So we launched it with the idea that it was an industry that we thought had a lot of potential for growth, certainly has the advertising dollars to spend and there was really only one major player in that space which is 1800Dentist. And so what it is is a dental directory, its actually the largest dental directory on the Web right now; that it has free listings as well as paid listings. So you have basically a white pages/yellow pages business model where you list everyone and then you also have paying doctors who want to get placed at the top of their city or zip code and then we build out a website for them internally on FindADentist.com.

Monte: Yeah. And so its been working out pretty good for you?

Brian: Yeah, its been doing great. It's a tough, tough road. I certainly wouldn't recommend it for everyone to build out a directory site because it is a very long term business model and you have to be prepared for a lot of hard work.

Monte; Right. And I guess, I guess . . . so are you making money on the referrals for people that find their dentist through that particular portal and site.

Brian: You know, we don't make money through referrals. We charge the practices an annual fee.

Monte: Oh, okay, okay.

Brian: We do have other advertisers where we, you know, whether it's a hybrid advertising/affiliate program, but generally speaking, for the dentists, it's an annual fee no different than, like I said, the yellow pages.

Monte; Great, great. Now, let's move on to NoParking.com in more detail. And talk a little bit about the concept and what makes this particular offering different than from what's out there – and there's not a whole lot out there, actually, to help people with development and really taking ownership and making sure that all these domain names are actually being put to use and becoming more valuable, but you're very clear and blunt with people on that panel and I thought that was interesting about, you know, the type of stake that you take in the domain name, why you take it, what the rules of engagement are, and you know, from your experiences – and you've had some great experiences and you've also learned a lot from bumps in the road, as you say, and mistakes, so walk us through the concept, why you think its going to be successful and what makes it different and kind of like the rules of engagement, how people can get involved.

Brian: Yeah; well, NoParking.com came out of, literally, it came out of my experience through TRAFFIC and the conference really because there's a lot of domains out there that are extremely valued but really don't have that much parked value, that much parked revenue coming in. So, it . . . I have some of those domains [laughs] you know, so it was very clear to me that, you know (and I purchased them, I wasn't lucky enough to catch them on a drop or acquire them back in '95 or '96) so there are domains that I bought that I know developed have significant value, so it was a combination of meeting people with, you know, extremely large portfolios with several domains that they would talk to me about that they knew they had to develop because there just wasn't that much parked revenue. So, the idea is to take the domain like that and partner with an organization, whether its mine or another one, that will take the property and develop it for – whether it's a joint venture or, you know, a pay-for-service. I mean, you know, obviously you can literally just hire a web development company to build out the property and you could run or hire someone that you put on your payroll to run it but NoParking is really a hands off approach. Its really no different than the amount of skills or involvement that's involved with parking a domain We would like to take the same approach with NoParking.com, which is all you need to do is change the DNS and then we'll take over from there. Our model is . . . its hard to get into all the details but each domain, depending on its value, can be structured differently, of course. I don't want to put myself [laughs] you know, in a situation where, you know, this is what you said or that's not what you talked about on Monte's show . . .

Monte: [laughs] Because it is, you know, its going to be transcribed, it will be podcasted, it will be . . . people will be listening to it, so get it right [laughs],

Brian: [laughs]. Right, right. ‘That's not what you said on Monte's show.' No. What I want to say is that this is just an example, but it's a standard example, if that's correct or not, but we take half of the revenue derived from the domain and we also take half of the purchase price, if the domain is bought at a certain point. So, that's very difficult for a lot of people to swallow as it was, as a lot of people said after I spoke at the conference. At the same time, I can't allocate resources and time to something that I don't have a strong equity stake in or a strong position in and I also don't . . . you also don't want to get involved with someone who's not going to be working really hard to develop that property, so the reason why it is structured like that initially is that you don't want the person who's developing it not to take it seriously and you certainly don't want the domainer or the domain owner to sell the domain after you developed it.

Monte: Right.

Brian: And also, I want to make sure that I lighten it up a little bit for the domain owner who's listening and that is if a certain revenue goal is not achieved or milestone is not achieved in, I think, twelve, twenty-four or thirty-six months, the domain owner gets the domain back.

Monte: You mean, free and clear with no [inaudible] back to you?

Brian: Nope, they get it all back. We keep the content and all of the rights to the designs but they have the domain back.

Monte: But they have the domain back; yeah, I see.

Brian: Yes.

Monte; So, if you didn't achieve your goal and objectives, if you didn't achieve your goal and objective, you can take the domain name back but you keep your work.

Brian: Right. Exactly.

Monte: Okay, I see. And so, okay, so, so, it's a fifty-fifty situation. So, that's a hard situation to be in, cause then who controls the actual interest. I mean, who actually makes the final decision, in an exact fifty-fifty split, is it the domain owner or is it you as the developer and investor in the property of when there's a certain way to go, who, who, who snaps the line and makes the call?

Brian: Yeah, there . . . it varies and we're, we're right now, as we speak, I'm in discussions with on a deal where actually the domain owner has all rights for an execution of a sale and I have no say-so; so I have no say-so in this, in the price of the sale and I have no say-so when the sale would take place. So the domain owner is in full control of whether or not he or she wants to sell the domain and he or she is in actual control of the price.

Monte: I see. So you're putting in the effort, so, at any levels, there's no minimal levels? So if they decide to sell it for $500?

Brian: Yeah, unfortunately, unfortunately, that is the case with this situation.

Monte: Okay. But that's not always the case because you're both investing time and energy and money on this situation so I'm just throwing that out there as a unique, you know, bizarre situation that could occur, you know.

Brian: Yeah, really . . .

Monte: Which [inaudible] rough times, for whatever reason and they got to liquidate, you could be stuck with a hell of a lot of hours, time and money into it and he gets to sell and you just get half.

Brian: Right, that's correct.

Monte: Okay, I got it. I got it.

Brian: And there's obviously risk-reward, you know, in any business venture that you walk into. But if it was a domain like, you know, take Software.com, for example, which we just recently acquired, right? I mean, if it was a domain like that, and you were the developing company and you were to take half the revenue developed and you know, you were at the mercy of the domain owner when it came to selling the domain, I don't, obviously, you, I think we'd all be willing to take the risk that the owner wasn't going to sell the domain for $500.

Monte: Right [laughs].

Brian: [laughs]

Monte; So, obviously, you're going to pick your partner on that particular domain name with enough brand value in the domain name by itself that you know that worse case scenario, if there was a problem, you're going to get some money out of it.

Brian: Right. And then we also have quite a few arrangements where the domain owners have gladly put the domain into a new entity and we, but we both own half of it, you know, and there's no, we both decide whether or not to sell it; we both decide at what price point we sell it and that's the deal. So I have . . .

Monte; So what happens if you want . . . if you're both at opposite ends of the spectrum, though?

Brian: Ah, then we continue to run the property.

Monte: Okay.

Brian: Yeah, the property continues to run. You know, if one of wants to sell and one of us doesn't then, you know, we've agreed that we'll just continue to run the property as is.

Monte: So, what's the big advantage then, ah, then, so in this particular case, I guess, the advantage of this is, is that you've done this before and you know what you're doing and you have examples of success that I guess, one of the messages that's posted in the chat room right now is that, why would I do that versus go out and get a designer and do it myself and develop it out? Obviously, you have the know-how, the knowledge, the business acumen to get the thing up and running and in a position to generate revenue and profit and that kind of stuff, so you kind of get a head start and you pay for it by giving up half your interest.

Brian: Yeah and its . . . and I understand why, you know, domainers, I always get that, I that email probably once a day from somebody that I know is, you know, why would I want to do that, you know? And, you know, it's kind of like . . . it's not for me to answer. If you don't think I'm worth it then I'm not here to sell myself [laughs], you know what I mean?

Monte: Right, right. Those of you that want to cross the line that say, hey, I'm willing to do that, hell, I'm not doing anything with this great piece of property anyway; I'm busy; I'm involved in another business and I got this 10, you know, 5 years ago or 6 years ago and if I'm not going . . . you know, when am I ever going to get around to developing it, now I can turn it over to an expert or something that can do it and sure, I‘d be willing to give 50% stake up for doing it.

Brian; Right. And the other part of it too is that its sort of . . . it goes along the lines of if you're hiring an investment banker to either acquire a company for you or to sell your existing company, you would, you could hire, there's a million investment bankers but the ones that have the most experience or have done it before certainly are worth far more than the one who, you know, just got out of, you know, business school.

Monte; And they cost more.

Brian: Right, of course, they cost a lot more. So its no different. I mean, we've been in the online advertising space, or I've been in the space, for a long time and I'm not the world's best monetizer when it comes to that, but I'm certainly, I certainly put myself in the top 100 [laughs].

Monte: Right. Well, that's pretty good position to be in. I'm sure there's thousands of people doing this and millions of domain owners and you know, 90 million domain names owned now, you know, across the world.

Brian: Sure.

Monte: To be in the top 100 player in that and having a unique business model that has a proven track record of both successes and failures and have the ability to learn to learn from those failures to turn it into success, you know, that stands for something.

Brian; Yeah. It's the difference between me being able to make one phone call and getting an advertiser or monetizing a domain versus, you know, taking six months to try to get some revenue in the door; that's all it is. I mean, we're not claiming to be the world's greatest, but we're certainly pretty well connected and we're pretty good at it, so its . . . its just . . . like I said, its just an option. Its not something that we're proactively gonna, you know, I'm not gonna start sending out direct mail pieces to all the domain holders and letting them know about NoParking.com. Its just an option, you know, and its .. . its an alternative for some people and its definitely not for everyone, that's for sure.

Monte: Right, right. And, and, are you able to talk about any of the current engagements that you're involved in? Like any of the domains that you're currently working on that look pretty exciting?

Brian: No, cause everything is very early on and you certainly don't want to . . .

Monte; Rock the boat.

Brian: Yeah, you certainly, yeah, yeah, you definitely don't want to promote something that could be a huge failure or could be a huge success, so . . .

Monte: Well, how many deals do you have that you're working on?

Brian: We have about 10 right now; I think there's 10. And we're working on three really good sized ones right now.

Monte; And how are you staffed for the development and the engagement in general? I mean, what's the organization structure look like? How is it funded? You know, give us some details regarding that so if people are interested in contacting you, they understand a little bit of background.

Brian: Yeah. Well, the organization is privately funded through myself as well as the entities that we run right now. We have a development here in the U.S. in Boston and then we keep a large group of developers, programmers and designers offshore that we've had on staff full time for three years, so its not something where we're looking to partner with 500 domain owners. It's a very, as I said at the conference, it's a select individual that we partner with, not so much the domain. I mean, obviously, the domain is very, very important but . . .

Monte; Well, you're actually going into a partnership with someone . . .

Brian: Sure. It's a marriage.

Monte; an entity, some concepts and some ideas, so you're right, you're not just looking at the domain name, you're looking at who you're going to be involved with and I guess you assume some risks, you know, about personalities and conflict of interest and how you work with that person and how you make decisions with each other and you know, you probably can't have too many in that mix, cause then it gets really complicated.

Brian: Yeah, no; its like I said, it's not something that we're trying to create this huge engine that can push out thousands and thousands of developed properties. I mean, that's not the case. We're looking at a hand . . . a select few, hand picked and the hardest part again is finding individuals that are a good fit because a lot of domainers are very (rightly so) they're really concerned about what's going to happen to the domain, right? There's not a lot of joint ventures going on in the space. It's . . . it can be . . . for good reason, right? A domain is worth a lot and you certainly don't want to get it screwed up by some joint venture.

Monte: Yeah.

Brian: So it takes a certain personality and a certain level of risk, you know, that you're willing to take to do that. And obviously, my personality and that other domain owner's personality has to come together.

Monte: Right. Right.

Brian: And that's not easy [laughs].

Monte: And, and, and is it your responsibility once you have the domain name to financially fund the rest of the project since they've given up 50% of their asset, you know, of their asset to you?

Brian: Yeah. Everything is funded up until a certain point. You know, just as an example – this is a hypothetical – as an example, if revenue exceeds half a million dollars a year, then, expenses would then start to be . . .

Monte: Coming . . . coming out of the . . .

Brian: Coming out of the organization. Correct.

Monte: I see. You're not continuing to dump personal investment or organizational investment and then when the things profitable and making money it should be generating itself and then you're then funding the business and then you're both sharing in the proceeds in the profit of the company.

Brian: That's correct. I mean if you build out a . . .

Monte: And you're not asking to be paid back your fee; you're going to do a 50% split at some point, just from that point on and that's your part of it.

Brian: That's correct.

Monte: Okay, so that's not such an unfair job. You know, an unfair proposal.

Brian: Yeah. No, its certainly not but it's a big . . . as I said, it is a . . . there's a certain amount of risk for both parties.

Monte: Well, that sounds great. Now what about . . . a lot of people went into TRAFFIC Silicon Valley not knowing, you know, how good or bad the show was going to be and stuff and I walked away just blown away about how good it was. What was your take on TRAFFIC Silicon Valley and the industry in general? For the first time, many of the investment side of our industry, or the new investors, attended the show and they were pretty interesting to hear speak and to revel us with the banks and the banking firms and the venture capitalists and stuff – since you're been a domainer for so long and you've been successful at it and watched the up and downs just like I have, give me your take on what's going on currently and what you think is going to happen in the next, you know, one, two, three years.

Brian: Yeah, that's a good question. I'm sure if I can predict one to three years out but I'll give you my perspective. The . . . I thought the conference was, was amazing and they just seem to get . . . each show gets better and better and I know some people had a little bit of concern that there was a lot of the same content flying around but at the same time there was a lot of new content flying around. I, as you stated with the investors and the bankers and some big, you know, some interesting parties that show up, it was, it made it interesting. I think the most interesting topics on the panels were the ones from the investment bankers. I thought that . . . I can't remember his name – Jordan the Analyst – and I can't remember the other gentleman's name that was up there with him – but that was a very interesting discussion about risk and where, you know, what the investors or bankers were looking for in terms of trying to understand the risk and they really couldn't put their finger on it. So I thought that was a discussion that will continue throughout the next few years, as they really try to understand from an investor's perspective, where do the risks lie when either buying portfolios or acquiring domains or investing in portfolios. So I thought that was very interesting. And then seeing a lot of new faces was, is always great. I mean, its always nice to see fresh tal . . . whether its individuals wanting to learn more or other domainers just coming and showing their faces and getting involved, it was a great show. Rick and Howard are doing a great job and their doing . . . they're having a great impact on the industry in general.

Monte: Yeah.

Brian: By having the shows.

Monte; And, and, did you walk away with any kind of, you know, better feeling about your particular investment into the business, into the industry yourself, from walking out of that show, or just confirming in your mind what you always knew? I mean . . .

Brian: Oh, no. You can't help but get energized and feel great just about being involved in the space, you know? Even if you own five domains, and you just come to the show to learn more and understand the space or look at it as a way to diversify your portfolio or get involved in another industry, I think its . . . I think its amazing, so every show is just . . . an energizing situation. It's always great to see, you know. People that you met a little while ago and talk about deals they put together and deals they've sold or domains they've bought; it's a great conference.

Monte: Good.

Brian: It's a great conference.

Monte: Good, good. Any other just key points and tips that you could share with some of your fellow domainers that are listening that weren't fortunate enough or were unfortunate enough not to make the shows and since you've been in the business for so long, give us like three or four things that are just critical that maybe people don't know about to be successful on the Web or develop out their property. The listening audience is a combination of, you know, domainers and webmasters and SEO experts and you know, some novice guys too, so give us some things that have really stood out for you as being definitely do, things you may not have known about, you know, to be successful doing the following.

Brian: Yeah, I think the most important thing is to keep an open mind, right? I think its really important that you, you know, you don't get closed off by doing business with one organization. I don't think you . . . its important to . . . if you're a parker, you need to test other, you know, other companies that are out there. You need to, you know, understand which domains perform well here and which domains perform and you just need to . . . I think its just real healthy to keep an open mind and test the waters with all the companies out there that are trying to service domainers. And you know give them a chance. I think that's real important and I think its also important for anyone in any industry is try to minimize their risk. I know that a lot of people are very bullish with respect to the domain space but some people (and not all of us) have these portfolios that are worth millions so when you have great domains that aren't, that don't have tremendous amount of parked value, I think its really important to: 1. either sell a small percentage of them or buy and sell; and also just keep an open mind about developing. I think that that's . . . I obviously [laughs] . . . that's what I do so I have a little bit of a biased opinion with regards to that but it is important in my opinion no matter what you're doing to spread your risk.

Monte: Yeah, definitely. Definitely. Well, Brian, its been great having you and you certainly, you're certainly one of the key men in the industry. And I know you say you're top 100 but you're top 10, top 5 in my book and people should listen to what you say and give you a shout if they're interested in working with you. What's the best way for . . . I know you don't want to be flooded with, you know, tons of domain names that, you know, may not be of interest, but should people do if they want to engage with the type of relationship that you have set up at NoParking.com?

Brian: They can email me. You can reach me at HYPERLINK "mailto:brian@noparking.com" brian@noparking.com, which is fine or you can always find me on the board and ping me there or always reach me at one of my forms on FindADentist or LasekEyeSurgery; plenty of sites to email me on, which is fine.

Monte: Cool.

Brian: But I do. I'd love to hear from anyone. Certainly always interested to talk to more people.

Monte: Well, I'll tell you. It's a different model and its going to work for some people. Like you said, you've got 10 things going on right and . .. projects going on right now and I betcha they're going to be successful, so . . .

Brian: I hope so and thanks a lot Monte for the positive feedback; I appreciate that.

Monte: I'm a positive guy. [laughs]

Brian: You are, man, you are amazing. I always, every time I see you, I think, man, I thought I work a lot, but you're an amazing guy, Monte.

Monte; Oh, thanks [laughs].

Brian: Amazing. And thanks for all, literally, thanks for all the work that you do. I think that you do a lot work for the industry, just as much as Rick and Howard do with the shows, I think you do . . . you have an immeasurable amount of effort you've put through and have had a tremendous impact on the space and I don't know anybody that's had a negative thing to say about you and I just want to say that you're doing a great job.

Monte: Well, hell, thank you very much. I mean, we . . . a lot of people don't give back until they've completely made it. We think it's a good idea to give back as we're building something great because, I've said it over and over again on the panels, that if we don't all work together, you know and create an industry that has stability and interest and attractiveness for people on the outside, then, its always going to remain our little world and the only way to get it bigger is invite people from the outside to come in and explore and invest and bring more money in and for everybody to work together and show that its stable and a great place to be in. And so, its really important to have people like you and people that we work with and we go out and you know, preach our wares and make sure that we dedicate our own time and also the company time to make sure that people understand what the differences are, cause you don't want to get burned either. You don't want to work with a company that's not on your side or aligned with you.

Brian: Right.

Monte: So it's important whatever company it is, whatever registrar or domain asset management company or whatever, you want to make sure that people are aligned with because its still early staged and risky and so we're one of those companies that are aligned with our customers, that's for sure.

Brian: Yeah. No, and whoever's listening should use Moniker; its; great.

Monte: [laughs] Thanks. Thank you very much. Well, Brian, thanks for being on tonight and I really appreciate your time and good luck with NoParking.com and I'll see you in May at TRAFFIC West, I guess.

Brian: Yeah, sure, look forward to it.

Monte: And it's a great sleep at night; thank you for that bet [laughs].

Brian: No problem, man. Thanks, Monte.

Monte: Alright, take care, Brian.

Brian: Alright, good night.

Monte: Great. Well, that's a wrap of this week's Domain Masters. Two great guests. If anybody has any comments or feedback, please make sure that you give me an email at HYPERLINK "mailto:monte@moniker.com" monte@moniker.com. We will be online next week as well. I'll have some exciting guests on again and the following week we're going to be broadcasting live from SES (Search Engine Strategies in New York). I'll be there with WebMasterRadio.fm folks and we're going to do some live show interviews right on the floor and real excited about that. Daren Babbin and Brandy and everybody on the WebMasterRadio.fm team doing a great job and we're going to be there live with those guys on the, I think it's the first of March at SES in New York City. And so, we'll have some great people interviewing there. So with that, I'll let everybody go. Have a great week and be the master of your domain. I'll see you next week, live, on another edition of Domain Masters. Take care.

[Commercials]

Back to Index