NameMedia in the New York Times

NameMedia gets an positive profile in the NY Times. Domains are becoming mainstream... Some quotes:

THINK you have a good handle on the Internet economy? Try this one.

What Internet business has raised $120 million in financing in the last year, owns 725,000 Web sites, and has as its chief executive the former head of Primedia and International Data Group?

If you guessed NameMedia, a privately held owner and developer of Web sites based in Waltham, Mass., you take the prize. Otherwise, consider reading on.

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NameMedia, which began in 1999 as YesDirect, was reintroduced in May 2006 with an undisclosed amount of equity financing from Highland Capital Partners and Summit Partners, two Boston venture capital groups, and more than $100 million in debt financing from Goldman Sachs. The company used part of that money to buy the portfolios of dozens of domain-name consolidators.

...

Youssef Squali, an analyst with the investment firm Jefferies & Company, said NameMedia faces stiff competition, “but I see these guys as the front-runner.” Among other things, Mr. Squali said the profit margin at NameMedia was 40 percent — a number that other industry executives said fairly represents the category over all.

Full article is here.

FlickrVision

Coolest thing you will see all day... http://flickrvision.com/

The Man Who Owns The Internet

Great article on Kevin Ham in Business 2.0 Great, long article. Excerpts below:

Kevin Ham is the most powerful dotcom mogul you've never heard of, reports Business 2.0 Magazine. Here's how the master of Web domains built a $300 million empire.

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Since 2000 he has quietly cobbled together a portfolio of some 300,000 domains that, combined with several other ventures, generate an estimated $70 million a year in revenue.

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And what few people know is that he's also the man behind the domain world's latest scheme: profiting from traffic generated by the millions of people who mistakenly type ".cm" instead of ".com" at the end of a domain name.

....

Ham still buys 30 to 100 names a day, but he's no longer getting them on the cheap. In fact, he and Schilling, who today maintains a $20 million-a-year portfolio from his home in the Cayman Islands, are often accused of driving up prices.

Take, for example, the $26,250 Ham paid for Fruitgiftbaskets.com, or the $171,250 for Hoteldeals.com. "The amount he will pay is crazy," says Bob Martin, president of Internet REIT, a domain investment firm that has raised more than $125 million from private investors, including Maveron, the venture firm backed by Starbucks founder Howard Schultz.

Nonsense, Ham says. The names are expensive only if you value them the way people like Martin do. The VCs and bankers, who were late to the domain gold rush, assess names by calculating the pay-per-click ad revenue and attaching a multiple based on how long it would take to pay off the investment.

Viewed that way, Ham's personal portfolio alone is worth roughly $300 million. But some of Ham's recent domain purchases would also look silly: They'd take 15 or 20 years just to justify the price, and that assumes continuation of the pay-per-click model.

But Ham is taking a longer view. The Web, he says, is becoming cluttered with parked pages. The model is amazingly efficient -- lots of money for little work --but Ham argues that Internet users will soon grow weary of it all.

When Ham buys a domain now, he's not doing pay-per-click math but rather sizing it up as a potential business. Reinvent Technology aims to turn his most valuable names into mini media companies, based on hundreds of niche categories.

DoubleClick, Google, Microsoft, Hellman & Friedman

Google snatches away DoubleClick from Microsoft. At this price, it is a defensive move to keep Microsoft from getting a greater foothold in online advertising (we originally saw prices of $2B or so bandied around), but kudos to Hellman and Friedman who bought the compay for $1.1B in 2005 when it was not obviously underpriced. Very impressive on their part. The sale was for 10x revenue (!)

Google reached an agreement Friday to acquire DoubleClick, the online advertising company, from two private equity firms for $3.1 billion in cash, the companies announced, an amount that was almost double the $1.65 billion in stock that Google paid for YouTube late last year.

Brief blurb at Dealbook.

Update:

More analysis from Paul Kedrosky .

How much worse can things get for Microsoft? After having almost certainly begun the DoubleClick bidding, thus putting the online ad company in play, Microsoft has seemingly been outbid -- again -- by Google.

Some seemingly think the price is vertigo-inducing, working out to something like 30-times DoubleClick's $100-million in 2006 ad placement revenues, or 12-times this year's forecast ad revenues of $230m or so. Yoicks! Can you justify that price based on economics? Some people will try, and that is always good fun; others will go on endlessly about the bubble-ish price. Both sides are wasting their time because the more interesting rationale is mostly elsewhere.

To borrow a phrase from Microsoft's past, this is a brazen attempt to cut off Microsoft's future air supply. The latter company is losing share in search, failing at ad placement, trying to find a new leg to growth, and generally floundering expensively in these crucial new fast-growing markets. What better way and time for bid-'em-up Brin to stick the knife in deeper every time Microsoft spots a possible life raft than for Google to buy the target acquisition company -- like DoubleClick -- out from under Microsoft.