sales Marchex sells portfolio of 200K+ domains to GoDaddy for $28.1m

jdab · Apr 22, 2015

Marchex, Inc. (NASDAQ: MCHX), today announced they have entered into a definitive agreement to sell its remaining domain portfolio of more than 200,000 domains to GoDaddy Inc.(NYSE: GDDY). Under the agreement, Marchex received cash consideration of $28.1 million from Godaddy, plus additional earn-out payments the terms of which were undisclosed including the maximum additional earn out.

Marchex also announced it sold $6.7 million in direct domain sales since January 2015 so the aggregate proceeds for all for its domain portfolio is $34.8 million, as well as additional earn-out considerations. I spoke to Pete Christothoulou, Marchex Chief Executive Officer yesterday about the transaction who confirmed that the remaining 100,000 domain names they acquired back in 2004 from Yung Ye/Ultimate Search for 64 Million dollars were included in the transaction.

Marchex announced that since they acquired Yung Te’s portfolio they have sold a total of $80 million in domains and generated more than $290 million in cumulative revenue, excluding domain sales. It’s important to note that what we announced selling today is NOT directly comparable to what we acquired in 2004, as we have sold certain assets since that time. Mr. Christothoulou also told me that Marchex would not be releasing details surrounding the $6.7 Million dollars in domain names they sold since January 2015.

According to Pete the domain names GoDaddy acquired from Marchex will be for sale through Godaddy/Afternic. Mr. Christothoulou told me that Marchex is now out of the domain business “Our complete focus is on establishing Marchex as the world’s leading mobile advertising analytics company”, therefore we at TheDomains.com will no longer follow the company. Its a pretty stunning turn of events for Marchex which announced in 2012 it was going to spin off its domain name division into a separate public company, before abandoning the idea in 2013."

Source: The Domains

Soofi · Apr 22, 2015

They moved out. Do they see something that we havent seen or expecting just as yet? market collapse?

S-B · Apr 22, 2015

Soofi said:
They moved out. Do they see something that we havent seen or expecting just as yet? market collapse?

Well, they probably saw dollar signs. *cha-ching*

ramkumaritrvs · Apr 22, 2015

Great deal for sellers.

Soofi · Apr 22, 2015

this_username_was_banned said:
Well, they probably saw dollar signs. *cha-ching*

Well being in the domain name business for quite sometime, and totally exiting is something that is undigested Shane. Hence, questioning their move

Soofi · Apr 22, 2015

ramkumaritrvs said:
Great deal for sellers.

By sellers, you mean to say Marchex right? :P

S-B · Apr 22, 2015

Soofi said:
Well being in the domain name business for quite sometime, and totally exiting is something that is undigested Shane. Hence, questioning their move

I completely understand. You also have to consider that 8-figures can start one helluva business, which would likely generate more stable income.

ramkumaritrvs · Apr 22, 2015

Soofi said:
Marchex right?

Yes. According to the report they earned already.

Soofi · Apr 22, 2015

this_username_was_banned said:
I completely understand. You also have to consider that 8-figures can start one helluva business, which would likely generate more stable income.

I know money speaks volume at times, however, total of $80 million in domains sales and generated more than $290 million in cumulative revenue, excluding domain sales since 2004 without having to do much other than listing them for sale or monetizing them is also a business in itself

johname · Apr 22, 2015

They know they dont want to be domaining 20 years from now. Its all about replacing quality and will domaing be the same in the future.

Curious to see how godaddy prices the names.

Soofi · Apr 22, 2015

johname said:
Curious to see how godaddy prices the names.

You know Gd is going to be expecting premium prices similar to their fee hikes :P

venturefile.com · Apr 22, 2015

It looks like they decided to try something new.. After 11 years of doing the same thing I would also do that if GD offered so much money.. Heck I usually do this after 2 years when I am in one project

SirDrago · Apr 22, 2015

Soofi said:
They moved out. Do they see something that we havent seen or expecting just as yet? market collapse?

Yeah, it's called ".App" with Google offering wireless service after 95.8 BILLION in mobile searches this year alone. 1.8 billion more than desktop searches. And we're only in April...

Soofi · Apr 22, 2015

SirDrago said:
Yeah, it's called ".App" with Google offering wireless service after 95.8 BILLION in mobile searches this year alone. 1.8 billion more than desktop searches. And we're only in April...

that is some scary Sh*t tbh..

SirDrago · Apr 22, 2015

Soofi said:
that is some scary Sh*t tbh..

It sure is, the fact is that Mobile is the future and our desktops will be stored right next to our vcrs and 8tracks.

Constantin S · Apr 22, 2015

No worries guys, just been sold to GoDaddy, SOURCE: http://www.zdnet.com/article/godaddy-buys-28-million-worth-of-domain-names-from-marchex/
I feel this will be a huge BOOM to domains value.
You can also see their full domain list here: http://www.afternic.com/namefind

Soofi · Apr 22, 2015

SirDrago said:
It sure is, the fact is that Mobile is the future and our desktops will be stored right next to our vcrs and 8tracks.

laptops and tabs as well? lol

johname · Apr 22, 2015

Tabs will be big phones. People will have mutiple phones. There will always be a business type of computer because employers dont want to pay people texting with thier thumbs and look at tiny screens, and have good posture. imho

Another way to look at the Marchex sale is that they sold them all, and no longer have to pay regs on the names. I dont know what rate they pay but take two year times 200k times the rate and add it to 28 mil

SirDrago · Apr 22, 2015

Constantin S said:
No worries guys, just been sold to GoDaddy, SOURCE: http://www.zdnet.com/article/godaddy-buys-28-million-worth-of-domain-names-from-marchex/
I feel this will be a huge BOOM to domains value.
You can also see their full domain list here: http://www.afternic.com/namefind

Marchex says it plans to focus on call advertising going forward.

"A significant and growing majority of the consumer engagement and sales driven by mobile advertising happens offline, such as through phone calls," said Marchex CEO Pete Christothoulou. "Narrowing our focus on this opportunity, while growing our balance sheet, strengthens our ability to continue delivering technology solutions that bring accountability to mobile advertising and transform business performance for our clients."

In black and white.

GoWebnames.com · Apr 22, 2015

Good move, good opportunity for domainers to snap up some good domains.
Now available at GoDaddy and https://afternic.com/listings/namefind

I was looking through the Marchex portfolio, saw Destination.com and searched on GoDaddy. The search result showed an auction for name but it said closed already. If someone here snapped it up, it's a great buy. At most, GD may have made a counter offer of $20k-$50k-$100k (min bid was at $10k) and it's a great great name even at that price. Worth Millions.

So, someone snapped up Destination.com really fast.

Moral of the Story: Eat your gazelle quickly like the Cheetahs while the lions & hyenas are still far away.

Billy Wagner · Apr 22, 2015

this_username_was_banned said:
Well, they probably saw dollar signs. *cha-ching*

Agreed. I'd sell my entire portfolio for 1/10 of that. lol

Compassion · Apr 22, 2015

This is a smart decision by Marchex to cash out. Most certainly a lot of the cream of the crop was sold prior to the deal. The terms beyond the 28 million likely provide them with awesome passive revenues as Godaddy sells the portfolio. 200,000 names at 28,000,000 is only 140 per name. The reality is to manage a portfolio that extensive, a lot of personnel is required - and of course there are all the renewals. Godaddy has many employees to manage such a portfolio and people searching for domains at Godaddy will find the acquired names very easily.

The IPO of GoDaddy helps enable the swallowing of assets such as Marchex.

Now Marchex is fluid and has minimal overhead. The endeavor to focus on "Mobile Advertising Analytics" likely will provide a superior bottom line in the long term.

IMO this was a solid exit strategy move that likely was in the business plan from the very beginning

SirDrago · Apr 22, 2015

I agree it's great to cash out and being fluid but now their focused on "mobile" advertising. So where does that leave the .Com which is depended greatly on "desktop"?

campout · Apr 22, 2015

The market likes MCHX's move: +14% today.

GoDaddy paid $140 per domain.

Name Trader · Apr 22, 2015

http://www.afternic.com/namefind

This isn't exactly a very friendly link, with 2 .com domains and then god knows how many .eu domains at $50 each. How on earth did @GoWebnames.com find Destination.com from that list?

sales Marchex sells portfolio of 200K+ domains to GoDaddy for $28.1m

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