Poll: Should Rightside Accept Donuts' $70 Million Offer? | DomainInvesting.com
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Poll: Should Rightside Accept Donuts’ $70 Million Offer?

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The big domain name industry news last week was the revelation that Donuts made a $70 million cash offer to Rightside to buy the publicly traded company’s new gTLD domain name extensions. Within several hours after the news of the offer was announced, Rightside issued its own press release to announce that it would give the offer (and any other offers) due consideration.

I am curious about whether you think Rightside should accept this offer and sell its new gTLD extensions. This decision is important because the company needs to do what’s right for its employees and shareholders now and in the future, and the outcome of this decision could have a big impact on the company.

I am not asking if you think they will or will not accept the offer, but rather if you think they should accept the offer. Vote in the poll below and share your thoughts:



About The Author: Elliot Silver is an Internet entrepreneur and publisher of DomainInvesting.com. Elliot is also the founder and President of Top Notch Domains, LLC, a company that has sold seven figures worth of domain names in the last five years. Please read the DomainInvesting.com Terms of Use page for additional information about the publisher, website comment policy, disclosures, and conflicts of interest.


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Comments (16)

    Ralph

    When someone offers you 70 million USD for your unwanted, dirty underwear, you hand them over.

    June 26th, 2016 at 1:20 pm

      Elliot Silver

      I don’t think the analogy is appropriate, especially given the fact that “unwanted” is obviously not applicable to Rightside with the new extensions.

      June 26th, 2016 at 1:29 pm

    Robert Monster

    It comes down to solvency. On a GAAP basis, Rightside is losing a lot of money lately. The company has significant liquidity issues with current liabilities more than 2X of current assets. You don’t need an MBA to see that this is a problem.

    The option of taking on more debt to plug the operating holes does not look like it is going to be an option. Cost-savings have been done. You can’t cost-save fast enough with his level of gearing.

    So, in the wake of new financial market uncertainty caused by Brexit, and any cascade of associated dominoes, the Rightside Board then has to make the call on whether to:

    1. Divest assets

    2. Sell equity

    3. Be acquired

    My guess is that the Donuts offer ends up being used a stalking horse. So now the world knows that these TLDs are in play and that an activist shareholder wants them unloaded. For Donuts the deal makes sense but for Rightside it would be a fire sale. Properly managed, there is lots of potential in this TLD portfolio.

    Personally, I think Frank/Uniregistry should merge with Rightside which then gives Frank’s investors a path to a public exit, while giving Rightside a shot in the arm in terms of leadership and robust customer-facing technology. Rightside already has industrial strength registry technology and a large opt-in customer network.

    Godaddy would be the other obvious acquirer. Arnold Blinn already has his team across the street in Kirkland. At the rate he is growing that operation, he will outgrow his new space. It would not shock me to see GDDY move their HQ to Kirkland.

    At the end of the day, I like working with Rightside. They have been great partners. By contrast, buying premium domains from Frank is like pulling teeth. As such, for entirely selfish reasons I prefer for Rightside to stay independent. However, rational people do rational things.

    Let’s see what happens. The stage is set. I expect something unfolds quickly.

    June 26th, 2016 at 2:46 pm

    Jeff Schneider

    We predicted the coming Consolidation of Regs.years ago and as marketing Analysts and Strategists we consider this a no-brainer. If all participants in all industry consolidations had exited earlier they almost always got better Book Value Valuations. (Cash in and run for the exits)

    Gratefully, Jeff Schneider (Contact Group) (Metal Tiger) (Former Rockefeller IBEC Marketing Analyst/Strategist) (Licensed CBOE Commodity Hedge Strategist) (Domain Master http://www.UseBiz.com)

    June 26th, 2016 at 3:49 pm

      Striker

      Who is “we”? Split personality(ies)?

      In reply to Jeff Schneider | June 28th, 2016 at 9:03 am

    Thomas

    take the money and run you fools

    June 26th, 2016 at 4:08 pm

    Ron

    Don’t you get it, these guys are all in it together, they are all interconnected, partners, do business with each other, large shareholders

    This is worse than the .ws hype

    June 26th, 2016 at 5:08 pm

      Striker

      Bingo.

      In reply to Ron | June 28th, 2016 at 8:58 am

    bobby

    The first rule of ANY negotiations is never ever take the first offer. If they want it enough to offer then they want it.

    June 26th, 2016 at 5:34 pm

    John

    I don’t think there is really even a wrong or right answer to your question because if they don’t try to grow they die, if they try to grow they die also just like the alt domains of yesterday that are now in the domain boneyard.

    Let them cannibalize each other because nobody really cares about these extensions except for the investors.

    Want to buy a .info, .biz, .mobi? I already know the answer and so you. It’s the same with all these new TLDs with very few exceptions.

    It’s almost like a Chinese showing up with all their cheap plastic junk products that fall apart really quickly. Same will happen to all these new extensions. They are total trash and are mostly a waste of money, under a bad regime who may stab you in the back with crazy renewal prices that might be 2X , 10X, 100X what you paid to register the domain initially.

    June 26th, 2016 at 7:44 pm

      Mark G

      I own and run a brewery in NYC, the .com and .net for my company are unavailable but .nyc and .beer were available which I now own and use. For me how are these names trash? I have what I need to advertise my business. My wife also had the same problem with her clothing startup until .fashion was released. Everything seems pointless untill you need it.

      In reply to John | June 27th, 2016 at 1:56 am

      Striker

      I’d change the company/brand name before I’d take a non-.com as the foundation for my business’ website.

      In reply to Mark G | June 28th, 2016 at 9:01 am

    Snoopy

    Rightside is badly run company that will never be profitable. They should sell those new tlds and then after that they should sell all their other assets.

    June 27th, 2016 at 2:09 am

      Ron

      As a user of Rightsides properties I can concur support at Name.com is slow, Enom is a old, and outdated platform, which has been given a graphical facelift, but the coding is still there.

      I tried to buy a lot of matching gtld’s to my .com’s, so when a buyer doesn’t have a budget for my .com, I could offer them that, total waste of money, no buyer is even interested.

      I would just advise domainers to stay out of the GTLD space as an investor.

      Yes, you see a large sale from time to time, of a good name, but these guys pay 5-6 figures annually in premium renewals. They are drowning in their own success, they are selling the best names to sustain the subpar, and we all know how this business model works.

      Take a look at where Rightside is located, and where Donuts is located, take a look at the inner circle, and how well they know each other.

      In reply to Snoopy | July 5th, 2016 at 11:59 am

    Jeff Schneider

    The answer lies in the advertising companies usage of SEM and the absolute dependence on Heavy Monthly,Yearly SEM costs that also include the Pilfering of massive amounts of Traffic stealing all SEM companies face within the Google,Facebook, Walled Gardens. All new Tlds require massive Google,Facebook support.How long does anyone think the Ad Industries mishandling of their clients Online Traffic being stolen will last?

    The Ad industries stance right now is = ” Don’t Ask, Don’t Tell ” This will be challenged more and more by savvy Online Marketing Strategies that By-Pass The SEM traffic Rustling Garden Mazes.

    The advertisers that use SEM are not protecting their Clients BRAND from massive Traffic losses within the SEM Marketing Gardens.Plain and Simple.

    June 27th, 2016 at 2:05 pm

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