Quinstreet (QNST) just announced today during its conference call that total consideration it paid for acquiring the domain name Insurance.com was $36.5 Million dollars.
$36.5 MILLION Dollars.
It does not appear from the conference call that Quinstreet acquired or even wanted to acquire the business that was formerly under Insurance.com, making this sound like pretty much a straight domain sale.
However “total consideration” can have more than just cash attached to it, like stock and option and a mixture of cash, but we will have to wait to find out all the details.
Many consider Insurance.com the most valuable domain of all and if so it now raises the bar for all domains to a level most in the domain industry would only image.
The question now is will there be a higher domain sale in the next 10 years than this one and if so which domain?
Great buy…will go down as one of the greatest buys in 10 years, they know how to market online, imagine if they ever decide to go global with lead gen…
Someone heard $35.6 Million, I heard $36.5 Million guess we will find out the exact number when the transcript is published
But either way its a record breaker.
Oops, I heard the $35.6 million. Maybe Mike is right.
I think in the future a City.com could set a new record. Any of the top 20-50 cities in the world may be able to do it.
I remember a stat going around at the Chicago GeoExpo that Vegas.com had become the first website to make a billion dollars in sales or some such.
George
It’s only a million don’t sweat it.
Remember at some point Quinstreet said hey how about $30 million and the owner said…..no.
It was a bit of a firesale price, too, given that the prior owners appeared to want a timely transaction (as they were going out of business).
Average return on their media investments exceed 30%! They’re expecting 20-30% for insurance.com, and are doing better than expected. So, they got it cheap.
George
Except their stock is falling like a rock
I bought it @$12 and it sits a $10
Acquisition price consideration for Insurance.com includes traffic and search engine rankings, so not entirely domain-only acquisition.
In my opinion, primary reason for the drop in the stock price is risk associated with exposure in the for-profit education vertical to proposed upcoming regulations, which is unclear how it will impact future financial performance.
70 minutes in, and they’re saying that it’s not a pure domain sale, but also for the content (which is driving traffic via SEO, etc.).
George
But what it is not is an ongoing business with a certain amount of customers or revenue attached.
So they can try to distance the purchase from a pure domain sale but its a lot closer to that than an acquisition of an ongoing business
It’ll fuel the debate on both sides, that’s for sure.
Quinstreet.com does have a publisher program, by the way. It might be worth testing, to see how they compare with AdSense, CJ.com, LinkShare, etc.
1020 pages indexed on Google.
They have a decent sized Search Engine Marketing Team as compared to other digital advertising agencies, SEM & SEO.
Also if it’s not a pure play domain sale then we can assume that there was a DB of consumer contact info, and a db of publisher relationships that transferred over.
During the conference call they made it clear Insurance.com was not just a domain-only transaction as they also acquired on-going traffic and natural search engine rankings from many years of hard work publishing content to the site.
However, in my mind this is as close as you will ever come to a domain-only transaction and I think it is beyond fair to argue this was the largest domain sale ever reported. Revenue from the existing agency business was not part of this transaction so the only thing changing hands is the domain name and website.
So in my book, this is a domain-only acquisition with a few small “extras” included.
Let’s assume monthly unique visitors of 250k along with existing website and incoming links is worth several million dollars, this still becomes the largest domain sale ever reported.
Extremely smart move on Quinstreet’s part and they have essentially secured the number one natural search engine result for this ultra competitive and extremely expensive search term. While the site does not hold the number one natural position in Google today, I fully expect Quinstreet to execute and land that spot within one year’s time.
I think they got a steal on the domain name, but its not just the domain name, you cant discount the seo and traffic of the transaction….if the site was great insurancedeals.com or some other similar name they would have still paid millions for the traffic…look at the bankaholic and creditcardguide.com deals as examples, but combining the great domain and built in traffic and it becomes more of a slam dunk buy… quinstreet runs a very nice publisher program in numerous verticals…mortgage, education, home services and insurance and they have always been fair with me so I would recomend them if you have sites that fit these niches..
I’m not sure if the stats are 100% accurate but according to several whois records, this domain has been dropped twice since it was registered in 1994?
I know how I’d feel if I had dropped a quick $35 mill.
Either way it’s a great sale/buy.
It was $35.6 million after all, I just listened to the archive of the conference call. One can access it via 1-800-406-7325 in the U.S. and Canada, or 1-303-590-3030 for international callers, using passcode 4328774#
Jeff
I agree with you.
If they acquired a “business” with the sale including customers and recurring commission then it included the sale of a business, but it did not.
PR, links and SEO go more to the domain than a businesses, so In my book its pretty much a domain sale.
This domain is outstanding and there is a huge value in the existing rankings this site gets. Much of the rankings are from the content and the links they’ve built and bought (there’s a recurring monthly or yearly fee on many of them – guaranteed). For a really high level idea of the traffic view the SEM Rush #’s here:
http://www.semrush.com/info/www.insurance.com+(by+organic)
You can’t buy traffic like this overnight, would take a few years at least + lots of resources to replicate.
Jeff,
“So in my book, this is a domain-only acquisition with a few small “extras” included”
Mike
“PR, links and SEO go more to the domain than a businesses, so In my book its pretty much a domain sale”
I think you both are smoking something …. Once a domain is not parked and becomes developed its no longer a domain sale.
All the PR, backlinks, pages indexed in Google and so on is part of a business that is attached to the domain name and not the other way around.
Jeff you said “this is a domain-only acquisition with a few small “extras” included” .. well if this name was parked it probably would get 3 or 4,000 people a month. Those small little extras you add on to dream this was a domain sale constitiutes most likely 95% ++ of the traffic this domain gets.
Mike,
How can all the development that goes in to a domain be negated to re-classify this just as a domain sale.
Please pass me what you are both smoking (and the others here who think is purely a domain sale) as I’d sure like to have some.
MHB,
Btw – It did acruire a business!
A lead generating business based on the traffic and rankings the site content (not the domain now – the site content) .. which is more of a business model than any domainer has flipping a domain
Sorry guys – but I think you’re all a little loco to call this a domain sale.
Alan
I can’t send you anything I’m smoking, think it would violate some state and maybe federal laws.
However, if you have a “site” on a domain, and you don’t sell a revenue stream, or a customer list, or if you can’t say you bought previously sold policies with residual income of x+?, then at the end of the day your buying a domain with all the links, & page rank and “other extras”.
Tell me what income did Quinstreet pick up as a matter of record with this purchase?
How many customers, how many policies, how much commission?
On second thought Alan you probably have better stuff to smoke than I do, send it over
Alan
Again tell me the finanical of the lead generation business they acquired.
How much will QuinStreet make based off the business they acquired because they sure did not give any numbers out on their call
MHB,
The same reason why someone just paid $100 million plus for creditcards.com and why QS bought insure.com for $40m or whatever it is.
How is this any different?
Quinstreet sells insurance leads through their company Surehits acquired a couple years ago. They are in the business of selling insurance – just not policies but ads.
The model is pretty simple. You get 200,000 + visitors a month with aged rankings, links etc… and convert the revenue stream to your own ad agency well .. bling bling is the answer
if this was a parked domain with just a few thousand in type in traffic it would take years to achieve this kind of organic volume in a competitive sector like insurance.
My guess is QS will earn this money back within 4 years. I was very surprised to see it sell for $36.5 million – my value would be more around 75m
Alan
that’s a different question what is the domain worth to the buyer.
In Quinstreet’s case I agree its worth much more than just the domain, but that’s why they were willing to pay what they did.
The question isn’t what ‘s its worth to them, but what else besides the domain did they get?
Mike,
You’re killing me .. they got a site with over 3,000 pages indexed in google – mostly aged content with many many backlinks, top search placements across all search engines and verifiable consistent traffic over 200,000 visitors a month.
Please tell me a parked domain that does this …. there are none. Sure, possibly a few with type in traffic equal but none that have anywhere close to this in terms of content ranking.
If someone paid $30 million for mortgageloan.com tomorrow would you consider it a domain sale?
If yes, then we are just from two different worlds my good friend 🙂
There are tons of $40 million sites around … but strip the content away and many of these domains would be lucky to fetch seven figures.
Alan,
Let me see if I can help.
CreditCards.com is an entirely different animal ….. the core asset in the CreditCards transaction was the existing business (the revenues, employees/executives, ongoing advertising costs and proprietary algorithms, company leases, computers, equipment, customer contracts, etc. the list goes on and on.) This was mostly a business acquisition.
On the other hand, Quinstreet only purchased the website and domain name …. they did not acquire any revenue, did not acquire any cash, did not acquire any employees, did not acquire any debt (that we know about), and did not acquire any ongoing operations or customers and/or executives or personal. The website, search engine rankings, and incoming links can easily be built by another company for several hundred thousand dollars at most ….. sure the search engine rankings take lots of time and effort, but my point here is the real core asset is the killer domain name. Yes, there is small value in the 200k visitors per month and the 3,000 indexed pages, but the core asset is absolutely the domain name.
CreditCards.com was primary a business acquisition with large ongoing revenues (the domain name added value to the transaction) and Insurance.com was primarily (or almost entirely) a domain name acquisition.
They are in the business to sell leads and traffic. The renewal business on policy renewals are worth much more than the 36.5 million. Think of how many polices they have sold online for car insurance alone. Though they are not in the business of selling insurance “just selling leads”.
36.5 million is a very nice price. They will make all that money back in about 3 years or less. With insurance leads going for 10 to 50 dollars a lead and auto insurance clicks averaging 12.00 this name is a money machine. I think it is a steal at this price.
The difference is that quinstreet is the sole supplier of leads with this name, no middle man or other affiliate sites they have to share revenue with.
This is the google of insurance names.
I would put carinsurance.com, Healthinsurance.com and any state names as worth a lot more money today:) I know a few of you that own a couple.
Don
Jeff,
I’m sorry – they did not acquire any revenue?
Of course they did — hell, insurance.com has one of the larger affiliate programs around for insurance. Did QS just say .. No, we don’t want this so keep it?
I’m from the development world and really have no interest in over-pricing or hyping a sale to call it a domain name sale.
Just like Mike and I here – totally agree to disagree and with even greater respect for all – I advise anyone thinking this is a domain sale to get a joint and smoke it while valuating your own portfolio. You may just be a billionaire tonight if you use this sale as a comparable value to your own domains.
Guys…have to agree with Alan here…2 better comparisons would be bankaholic and creditcardguide.com….the domain is a category killer, but you cant discount the traffic from organic search that it brings in…its more of a website sale than anything…none the less it speaks volumes to the category killer domain + development = big money biz model
Here are some advertising stats from AdAge:
http://adage.com/marketertrees09update/
Allstate – $526 million
Geico (within Bershire Hathaway) – $618 million
Progressive – $470 million
State Farm – $576 million
Those are just 4 insurance advertisers, in one country (USA). $35.6 million represents a couple of weeks worth of ad spending for those guys.
I think Jeff said it well:
“””On the other hand, Quinstreet only purchased the website and domain name …. they did not acquire any revenue, did not acquire any cash, did not acquire any employees, did not acquire any debt (that we know about), and did not acquire any ongoing operations or customers and/or executives or personal. The website, search engine rankings, and incoming links can easily be built by another company for several hundred thousand dollars at most ….. sure the search engine rankings take lots of time and effort, but my point here is the real core asset is the killer domain name. Yes, there is small value in the 200k visitors per month and the 3,000 indexed pages, but the core asset is absolutely the domain name.”””
“”.. I advise anyone thinking this is a domain sale to get a joint and smoke it while valuating your own portfolio. You may just be a billionaire tonight if you use this sale as a comparable value to your own domains. ..””
WOW it works. I’m rich!! And stoned! 🙂
For those that don’t believe this to be a pure domain sale , what’s the domain worth in your eyes ?
And for those who do think it’s a pure domain sale, was it a good deal, just right or overpaid ?
Let me put this in perspective. Comparable domains which sit there parked collecting dust and have no search rankings are in no way comparable in value to a domain with such content ranked and linked to.
We all use the real estate comparison so lets do this again … as someone needs to explain this anytime a company with a .com sells
Let’s say we have 2 identical waterfront lots next to each other.
Waterfront lot # 1 is empty – just a lot
Waterfront lot # 2 – 2000 luxury units built with people coming and going
If a buyer pays $35 million for lot # 2 and is going to keep the building up and people will keep coming in how the hell is this comparable to Waterfront Lot # 1 ??
This is exactly what you guys are trying to say.
Of course, there is no comaprable for insurance.com but you are trying to value a domain based on the existing traffic and content as it were simply parked.
Its silly people – silly with a capital S.
Jeffrey’s comment “Yes, there is small value in the 200k visitors per month and the 3,000 indexed pages” is seriously about as dumb as any domainer could say it.
(Note to Jeffrey: I am referring to your comment – not you as an individual)
Existing rankings and traffic are not easy to replace. It takes time, money and skill – Far more skill than most domain owners will ever have to understand the complexity of getting sites ranked in valuable categories such as the insurance.
So in summary – we have 200,000 + visitors a month, a verified revenue source, an affiliate program and more … and people still think it’s a domain sale??
You’re all loco.
My argument is the core value of this acquisition is in the domain name.
Yes, this domain name does generate ongoing revenues and played a factor into this transaction. Lets do the math; with 200k monthly uniques and assuming 5% lead conversion ratio with each lead worth $25, this is $3m in revenue per year. Using a multiple of 4 pegs the value of existing traffic at $12m.
So yes, I agree part of this transaction is made up of the existing traffic, search engine rankings and website (like i said many times above.) But i still believe the bulk of this transaction factored heavily into this killer domain name. Had the acquiring domain/business been http://www.insuranceforthepeople.com it would not have fetched nearly as much money.
Alan,
I recall that fund.com, just domain name, not website was sold for $10 million. Cna you comment on this transaction?
Jeffrey,
Thanks for clarifying however this is exactly why I think trying to claim this as a domain sale is completely ridiculous.
To answer your question – if the name was insuranceforthepeople.com and had the same traffic stats, SEO ranking and in the same industry the site could still be sold 36M regardless of the domain. Why not? What does the domain matter when you have a proven model for traffic?
Look – I think the domain inurance.com is worth $30m or more standalone but my point is the transaction is not a domain sale. Domainers hang on to any domain sale so they can artificially inflate their own values.
How many times do we get asked to buy a domain and the seller gives us domains like this which have sold as comparable when their domain is just some stupid domain sponsor page with no traffic. This is not apples to apples.
CreditCardGuide.com was sold for $32 million in 2008 with almost the same traffic and stats but we can all agree this name is probably worth 100k max.
Sales like these are not domain sales.
There is obvious value in insurance.com and I do think its worth a lot more than any sex.com and probably one of the top 20 domain names in the world but because it was sold with content, links and traffic it disqualifies it from a domain sale no matter how you look at it.
Domain sales in my definition – and once again I will probably differ from “domainers” – but any site that has more than a mini-site on it is not a domain sale.
A domain sale is a sale of a domain name – pure and simple.
Any domain with (a) content (b) revenue created from such content and (c) traffic gained from search rankings with that content is a website or company sale
Original content is the key here – not cookie cutter stuff like most domain service providers have but original content like insurance.com had
Insurance.com is not a domain sale.
RL / I have no comments on fund.com – If a buyer was willing to pay $10m for it then go for it but I have no idea if the domain was parked or developed before the sale took place.
Now for MHB.
If you sell theDomains.com for $20m tomorrow do you think people will scream how your domain was worth $20m – applaud you on the back for selling a killer domain and try to inflate any domain name with the keyword domain in it … Sadly they will but we both know the work you have put into this site and traffic enjoyed.
That is the pure essence of telling whether or not it’s a domain name sale or not.
If you were to sell out tomorrow and not calculate any of the work you put in but simply valuated the price of based on the domain itself then we have a domain sale but that surely wouldn’t be anywhere close to the value of the site with the domain.
Do I think insurance.com was a steal – hell, yes – but it wasn’t a domain sale.
Companies spend thousands, or even millions, of dollars every year to promote their products or services and create name recognition. They are creating a “brand,” which can be a very valuable company asset. Insurance.com is the address of a website that is intended to be easily identifiable and easy to remember, for all specific purposes, and it functions as a trademark, with the generic and descriptive way, that trademarks does not. According to some internet sources, the brand name Apple® may be worth more to the company than any patent it owns.
RL,
You are right and if Geico bought this name for 10m or 100m and it was parked it would have been a domain sale but in terms of it being a pure domain sale its not
All anybody is doing here is guessing how much the domain sold for when it could have been 2m or 20m of the calculation used
Its an unknown number so how can one declare this a domain sale?
Today it has been suggested that one can spend $1 million dollar for SEP and SEO to achieve equivalent results in terms of traffic driven to a website with some inferior name that comes at no cost. This apears to be true. It appears also that it woud make sense to spend $36 million dollars to buy traffic to achieve superior results over time. One can create a business model to measure cost effectiveness of various scenarios of business deals, taking into consideration obectives business specific, measurable, attainable, realistic, and time specific criteria.
I have In-surance.com. Not worth anywhere near that amount with the right content + lead gen partners, it could generate few thousand a month. I’ve done something similar on a hyphenated domain.
I know it’s just business as usual but’s let’s congratulate Quinstreet for putting 144 people out of work in these times of 10% unemplyment.
Alfred,
Lots of people get sacked every day – in a good economy or bad economy – entirely not relevant.
I worked there, and I cannot believe that a company that spent 80% of their money on non SEO or returning visit traffic via a revolving door marketing department…whom spent money like it was going out of style…actually were able to dump this domain for more than the 10 million it was ever worth as a word, and never was in the black as a company.
Good luck, and farewell…
Laughing out VERY loud!
HA HA HA HA!
Sys
They spent $16M on insure.com
Allan,
Tell all those unemloyed people there are not relevant, it may be you someday. By the way Sys is right, that company hasn’t been in the black for years. Maybe that’s why they went thru CEO’s like a hot knife thru butter
Alfred
This is why I think people need an IQ test to vote.
I did not comment on the layoffs – I said how the layoffs were entirely irrelevant to the topic being discussed.
I don’t care if 144 or 144,000 people were laid off – The topic of discussion was the sale of the domain. If you want to sit around and feel bad for people being laid well you can do that any day of the year. I never comment on people being laid off since it has nothing to do with anything. Private business can do what they want. Sure – its sad people lose their jobs but its the reality of the business world and you can always find a sad story if you want to.
The discussion here was about whether or not this was a domain sale.
How the hell are the layoffs even relevant here?
There are not
This doesn’t surprise me. As far as keywords domain names go they are either the second rate keyword domain like greatinsurance.com so you might as well go with a brandable name or they are the number one keyword like insurance.com and it is worth the big bucks to get the best real estate in your industry.
We’ve quietly acquired Insurance.AC & Insurance.io this month. Shhh…don’t tell anyone 😉
– TBC
I see the .io registry has rebranded itself as a “social extension” – check it out @ nic.io
Estibot values Insurance.com at over $260-million (over 1/4 billion dollars!) – this is the only domain that I’ve found Estibot to value so much more highly over a published sales-price. I believe it’s because of the super-high CPC for insurance terms, coupled with the volume of searches for all things insurance related. In other words, the $36-million purchase was an absolute steal for QS and if these ccTLD’s owned by “TBC” ever get fully developed by someone, they could be worth at much as $1-million each someday. Good luck “TBC’.