Blogs about the domain industry and the various players and companies within it.

Freelancer.com Acquires Escrow.com

Freelancer.com Acquires Escrow.com

In breaking news, Australian company, Freelancer.com has reached an agreement to acquire Escrow.com for $7.5m in cash. Freelancer.com is the world’s largest freelancing and crowdsourcing marketplace by number of users and projects.

For many years, Escrow.com has been the company of choice used by many domain investors for their sales and acquisitions. Escrow also partners with eBay, GoDaddy, AutoTrader.com and Flippa.com and has a strategic partnership with the U.S. Commercial Service (USCS) in support of President Obama’s National Export Initiative designed to significantly grow US export volume.

Escrow.com

Since Escrow.com has been a private company this is the first time that we’ve had a glimpse into the financials driving the business. As can be seen from the chart below, Escrow.com has experienced continued growth even in the downturn years of 2012 and 2013. According to the press release announcement, for the FY14, Escrow.com has facilitated a gross payment volume of US$265 million, net revenue of just over US$5 million, US$1.2 million in EBITDA.

Escrow.com Revenue

What's really interesting is where all the revenue is coming from and the fact that  only 41% is coming solely from the US market. This really shows that the Escrow.com team is viewing the world as their marketplace rather than just the USA.

Revenue sources

Given the $7.5 million price tag this means that Freelancer is paying at least a multiple of 6.25. This seems reasonable given the strength, sustainability and market position of the Escrow.com business.

Continue reading
Recent Comments
impulse
That seems like a much lower price for escrow.com than I would have imagined. It is a business with growing sales and a large annu... Read More
27 April 2015
mgilmour
It could be argued that it's a bit of a steal but at the same time my guess is that the single shareholder was a motivated seller.... Read More
27 April 2015
impulse
Yes, that is very true. That is exactly why I sold Bored.com for $4.5 million in 2008, see my reasons at http://www.impulsecorp.co... Read More
27 April 2015
3887 Hits
3 Comments

Moving Forward in 2015

In 2015 the domain industry was launched with Namescon but there's a lot more on it's way. Domaining Europe, ICANN conferences and The Domain Conference being run by Howard, Barbara and Ray Neu are just a few of the topics discussed on this video.

2162 Hits
0 Comments

When is an Escrow not an Escrow?

When is an Escrow not an Escrow?

I was reading another blog recently (yes I do that) and was intrigued by the comments on an article about escrow. A viable, secure and reputable escrow service is absolutely key to every domainer if they are to safely buy and sell domains. So when is an escrow not an escrow?

I used three key words in my first paragraph and I would like to unpack them to help readers judge and escrow service.

Viable.
Is the business that is ultimately backing up the escrow service going to be there tomorrow? Do they have the financial ability to pay their debts when they fall due (ie. are they solvent)? My impression is there are too many people hanging out a sign saying that they can do escrow and actually have no idea what it means.

For example, I receive requests all the time from new monetisation companies wanting to get access to our large volume of traffic at ParkLogic. My problem is that for many of them I don’t know if they will be in business in the next 12 months. It’s the same for some of the start-up escrow companies, they just aren’t viable.

Secure
Security is all about whether there is an independent body that verifies that the internal processes of any escrow transaction are auditable and transparent. This means that the escrow company needs to go through the expense of government audits that verify they are a legitimate escrow business that is conducting themselves in a good and proper manner.

Recently I’ve seen a number of escrow companies pop up in strange and wonderful jurisdictions. This doesn’t mean that the escrow company is bad but it does mean that they are doing this for a particular reason. In many cases, it could be that the costs of providing a fully operational escrow business in the USA is too high, therefore they get an escrow license off-shore.

The advantage of a company that goes through the expense of a US license is that they tick a lot of the boxes. They have the money to pay and go through the government audits. It’s very likely that the US government audit will be a lot more stringent compared to other jurisdictions.

For example, my understanding is that you need to get a license for each US state (some are bundled together) and that California is really the big one. I’m not a lawyer but if you’re conducting an escrow business in California without a license then I would have thought that you’re on dangerous ground. There are some creative ways around this problem but if you’re doing business in California as an escrow company then why not just get the license and be done with it? I may be a little naïve but I just don’t get it.

Reputable
One of the most difficult things that you can do in business is build a good reputation. It often takes years and years of consistently doing the right thing by customers.

For example, I’m privileged to be part of a group of domainers get together at each conference. We do so because over the last 10+ years that we’ve known each other there has developed a sense of trust and mutual respect. It’s taken a lot of time to build these relationships and the result is a huge amount of business between us.

It’s the same thing for an escrow company. It takes years to develop the reputation as a place that can be trusted with literally millions of dollars of transactions. Reputation is everything.

So when is an escrow not an escrow? From my way of thinking, it's when they can't tick the boxes of viable, secure and reputable.

I’m very careful about who I have sponsoring my blog and I’m very proud to have Escrow.com on here because they are viable, secure and reputable. I’m not saying that any other escrow company is not any good. What I am saying is that I’ve only had positive experiences of dealing with Escrow.com

---------------------------------------------------

Michael Gilmour has been in business for over 32 years and has both a BSC in Electronics and Computer Science and an MBA. He was the former vice-chairman of the Internet Industry Association in Australia and is in demand as a speaker at Internet conferences the world over. Michael is passionate about working with online entrepreneurs to help them navigate their new ventures around the many pitfalls that all businesses face.

Recent Comments
mgilmour
I completely agree with you. Escrow is peace of mind and you're a great ad writer!
04 March 2015
3315 Hits
2 Comments

Interview on Domain Masters Radio

Interview on Domain Masters Radio

I just had a great time with Jonathan Tenenbaum and Scott Pruitt from Domain Masters radio. In the show we covered a huge range of topics, starting with my own personal story and how I entered the domain industry. It took me down memory lane and caused me to reflect a little on the journey over the last 14 years.

We then moved on to how to extract the most value from domain traffic. Times have changed in doing this, you can no longer just pick the gold up from the ground. I relate how ParkLogic is like drilling a mineshaft three miles down to find the seam of gold for each domain.

We finally discussed domain development and how it's so important to start with a business model and move on from there. Many people start with building a website and then try to make money....it's the wrong direction to head.

I want to thank Jonathan and Scott for the opportunity to be a part of the show. They do a great job! Here are the links to the live cast and the archive.

Live Podcast

Archive Podcast

---------------------------------------------------

Michael Gilmour has been in business for over 32 years and has both a BSC in Electronics and Computer Science and an MBA. He was the former vice-chairman of the Internet Industry Association in Australia and is in demand as a speaker at Internet conferences the world over. Michael is passionate about working with online entrepreneurs to help them navigate their new ventures around the many pitfalls that all businesses face.

2468 Hits
0 Comments

Namescon - The Week After

Namescon - The Week After

So it’s about a week after Namescon and I’m sitting at my desk still feeling a little sorry for myself due to the jetlag. It’s always a mad scramble after returning from a conference.

Conferences are the place where an incredible amount of business is conducted in a very short time. I could be a bit rude and suggest that it’s similar to other activities in life but I think that I just won’t go there.

Escrow.com

My typical Namescon day began at about 7:15am where I woke up with the sun on my face. I always sleep with the curtains wide open to help shove my body into my new time zone. It may sound stupid (my wife thinks it is anyway) but it seems to help me out.

My first meeting is usually for breakfast at around 8am and I end up with a meeting scheduled every hour until 8pm that night. On the last day the time slots typically dwindle down to 30 minutes. So when I say that it’s a hectic pace, it really is.

I had the strangest feeling when one of my meetings didn’t show up on the last day (they were delayed) and I had 30 minutes spare. I sat down a bit bewildered wondering what to do. It was if the heavens had opened up and blessed me with 30 minutes of my life back. So that I wasn’t letting my son down (he’s part of my team) I played a quick round of “Clash of Clans” on my phone. If any of you play the game then message me and feel free to join my clan. :-)

So what am I really saying about Namescon. It was crazy! There was so much business to do, people to meet and really interesting conversations to be had. I loved it!

A funny thing did happen on the second to last day when Scott Ross, a few other domainers and I saw a whole bunch of hotel security guys go to bust a domainer that tried to abscond with a bunch of donuts. I think that they were hungry….don’t blame them….so were we! I’ve never laughed so much in all my life….precious moments.

So what was it that made Namescon so good? Was it the hotel? The Tropicanna was actually pretty average but I’m happy as long as I have a clean bed and it ticked that box.

Was it the sessions? Perhaps, I heard some great reports from a number of the sessions….I just wished I could have attended more of them. There were some world class speakers presenting and multiple streams to choose from. My ParkLogic business partner attended quite a number of the sessions and on the whole the he thought that the ones he attended were outstanding.

What I found really made Namescon a great event were two things. The organisation was nothing short of superb. The whole Namescon team should be congratulated on their amazing effort….I would like to really thank Matt, Mark and Angie who all helped me get set for one of my sessions. Nothing like dealing with a speaker with special requirements…!

What I did notice was that nothing was too much trouble for any team member….including Jothan, Richard and Jodi. They all worked really hard to ensure that everything flowed as smoothly as possible for the attendees.

Which brings me to what makes a conferences great…..it’s the people that attend. Business is conducted between people and there was just so many great people to meet, get to know and then knock out deals with. I would like to thank everyone that took the time to attend Namescon as ultimately, it’s you that made it an awesome event.

So I’m looking at my calendar for the next 12 months and couldn’t help notice that there isn’t very much in the way of domaining events scheduled. With any luck TRAFFIC will be back in May…..I really hope that I didn’t miss the very last one. I would just love it, if there were three conferences per year that grew to have the impact of Namescon. It’s put the domain industry back on the map in a major way.

Below are a few shots from Namescon to give you an idea of the size and scope of the event.













---------------------------------------------------

Michael Gilmour has been in business for over 32 years and has both a BSC in Electronics and Computer Science and an MBA. He was the former vice-chairman of the Internet Industry Association in Australia and is in demand as a speaker at Internet conferences the world over. Michael is passionate about working with online entrepreneurs to help them navigate their new ventures around the many pitfalls that all businesses face.

Tags:
Recent Comments
mgilmour
Hey Dietmar! That is so true! Please accept my apologies and feel free to add the event to the domaining events calendar here.... Read More
23 January 2015
2398 Hits
2 Comments