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A web
designer working on a site for him told Grant he should register
his company name RobGrantRealEstate.com but (even
though he did take that
domain) he had bigger ideas from the start. “Nobody here cared
about Rob Grant – what they cared about was Adirondacks Real
Estate and I felt that is what they would look for.” When he
looked to see who had AdirondackRealEstate.com
he was surprised that it was available for registration. He
quickly took it then, convinced that he was onto something big, went
on to take thousands of other .com domains starting with a city,
state or country name and ending with “real estate.”
At that
time Network Solutions had a monopoly on domain
registrations so it cost about 10 times what it costs to
register a domain today. So, Grant laid out a huge amount of
capital on a theory that most thought would never pan out. Also
keep in mind that back then there was no PPC, no Yahoo
and no Google, so the domains had only one apparent value
– their generic brand value. Grant said, “my hunch was that
as the Internet grew and developed these intuitive brands would
take on more value as property and assets.” That was the
beginning of Grant’s remarkably deep Real Estate Directory at RealEstateDirectory.com.
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Grant
hooks a big one.
Photo shot earlier this month (April 2008)
off Anna Maria Island, Florida where
Grant has a vacation condominium |
Grant
soon started taking his idea global, sweeping up key real estate domains outside the U.S. “That was
really an exciting time because no one had thought to go
international,” he said. “There was very little
resistance, unlike today when there is so much
competition.” Though Grant was focused on real estate
he realized that this same phenomenon would happen in
many other industries. “If you could own a keyword
term for a particular industry that was a very
significant asset so I picked up some in other categories
too, like TropicalFish.com, CaribbeanResorts.com,
LiteraryAgents.com, BookPublishers.com
and
MusicPublishers.com”
On
the downside, the more domains Grant piled up the
scarier it got because of the extremely high annual
registration and renewal fees at that time. “It was
brutal,” Grant said, “because you had these high
carrying costs but absolutely no revenue. You really had
to believe. I feel it was the true test of whether or
not someone has vision. I sat for years paying these
registration fees and not earning a nickel and wondering
if I was out of my mind.” Grant, who piled up
over 8,500 domains (many are featured at WebMediaProperties.com),
added something that a lot of guys (including me) can
also identify with - “my wife also wondered if I was
out of my mind!”
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Rob
Grant and daughter Caroline at a Jan. 2008
DOMAINfest Global Conference party. Considering
the yellow python around his neck, Rob is
obviously not a guy who scares easily! |
Grant
not only held on when the .com bubble burst in 2000 (reinforcing
critic’s views that domain investors were nuts) he used that
as an opportunity to buy up more high quality assets as others
panicked and sold out cheap. “They had decided they had made a
bad move, that they had been in it long enough and they had made
a bad investment and they were getting out. I remember buying
good domains for a dime on the dollar,” Grant recalled.
“I can’t
tell you how many times people told me to get out. That the
domain thing was over – especially the techie guys. They never
got it. They didn’t have the marketing background and I know
they kick themselves to this day for not understanding the true
value of these names,” Grant said. “I’ve seen so many
peaks and valleys since 1996 and in each valley there was a
washout as people get scared or got discouraged and got out.
Then a new generation would come in with a new sense of
conviction.”
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Grant’s
belief in real estate domains has never wavered and today there
are now multiple ways to monetize those domains. He has some
leased out through LeaseThis.com
and there is always PPC, but he said the best returns can be
realized through lead generation. For example he has HawaiiRealEstate.com,
representing a state where the average home sale is $750,000.
A single lead to a licensed broker in Hawaii can be worth up to
$45,000.
Grant
did better than that with a listing on his CatskillsRealEstate.com
site several years back. Though his company was several hours
north of the Catskills, he won a listing for a very large
multi-million dollar estate and marketed it through his
Catskills domain. He ended up selling the property in house with
no help from any Hudson Valley or Catskills area
realtors, giving him the full commission – approximately $150,000.
“This showed me that with the Internet you could reach out
beyond your traditional territory – you were no longer
restricted by conventional boundaries which might extend maybe
50-70 miles from where your agency was,” Grant said. “It was a
great case study for me.”
With his
business thriving and interest in the Adirondacks reaching a new
high, Grant started looking for ways to give back
to a cause he believed in. A few years ago he settled on
higher education, especially small schools like his Prescott
College alma mater. Again drawing on his marketing background
and the power of domains he felt he could help quality schools
that were struggling to compete more effectively with better
endowed institutions that were chasing the same pool of students.
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“By
giving them intuitive domains we felt we could help them
increase their admissions and also increase their brand
exposure, “ Grant said. “We started with Paul
Smith’s College in our neck of the woods in the
Adirondacks. They had a very enlightened president who
was receptive to the idea so we were able to work with
them to build a network of domains that effectively
drove traffic to the college’s website. All they
needed was one applicant enrolling from the program for
four years to gain $120,000 in tuition. We
started by giving them $10,000-$15,000 worth of
domains and they were very excited with the results so
we went on and gave increasingly larger gifts to other
colleges.”
The
donated domains are appraised by Moniker.com and
though many appraisal
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Paul
Smith College President
George Miller (left) with Rob Grant |
| companies
tend to come in on the high side (to ensure happy
customers who will come back and order more appraisals)
the long list of appraisals I saw for names Grant
donated were on the very conservative side. This is
probably why Moniker’s domain appraisals are
recognized and accepted by the IRS. |
Grant
made a portfolio gift valued at $60,000 to Prescott
College that included Conservationism.com, FinancialGrant.com,
LiberalArtsDegrees.com, MastersDegreePrograms.com
and many others. He followed that up with another portfolio of
107 domains valued at over $99,000. A portfolio valued at
over $237,000 went to his daughter Caroline’s present
school, St. Lawrence University in Canton, New York.
In 2006, a portfolio of 225 domains valued at more than $371,000
was given to the College of St. Scholastica in Duluth,
Minnesota. Paul Smith’s College also got new gifts
totaling over $84,000.
The
schools have been thrilled with the donations. Grant has also
consulted closely with school officials on how to best use the
domains. While there is a lot of value in redirecting keyword
domains to the the individual school’s websites, some are
moving beyond that. St. Scholastica is setting up a committee to
work on building out some of the marquee domains given to them.
Both faculty and students will be involved in those projects.
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The
Adirondacks |
Grant
is now expanding his program beyond colleges to other community
organizations and non-profit groups. He also provides hosting
services and website marketing advice to many groups in his
area. More details are available at Grant’s Adirondacks.com
website.
Adirondacks.com
is one of about 1,500 developed websites that Grant operates. It
includes a busy travel section and Grant is now applying the
same formula to travel guides in Florida and Vermont.
Though domain development has just become a front burner issue
over the past year as PPC revenues have fallen Grant has been
developing properties for ten years now. “It takes a lot of
hard work, you’ve got to have the right content, you have to
continually refresh that content and you have to have a sales
team that goes out and gets the advertisers,”
he said.
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Development
is just one of many ways Grant has financially diversified in
recent years to protect himself from shocks in any one category.
“In addition to our real estate brokerage, we operate a self
storage business, we have a big vacation rental business, I
operate a 23,000 square foot office building, so we have both
commercial tenants and residential tenants. One of the lessons I
learned early on was that it is very important to be as
diversified as you can be. You can’t rely on any one business
model because if you do you will be taken out. I’ve
seen it time and time again and I’ve had it happen to me. So
anytime I see an opportunity to create a business, or even just
another revenue stream, I do it.”
| Grant
has been around long enough to see just about every
conceivable up and down in the business cycle. With the
general economy now going through a major down cycle, I
asked him what he thought about the domain industry’s
prospects over the next year or two. “I think we’re
going to go through a very intense period and I think we
are going to go through another shakeout. We have seen
these rough patches historically in the domain space and
I think |
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now we are faced with multiple threats. There is going
to be more and more dangerous legislation created that
could take our domains away and I commend the Internet
Commerce Association for everything they are doing
to combat that and everyone needs to understand how
important it is to support the ICA” Grant said.
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Grant
added, “The National Association of Realtors (NAR)
understood decades ago how important it was to have an
organization that could lobby on Capitol Hill and the NAR is one
of the most powerful lobbying groups in the world. What we have
seen in the real estate industry is wave after wave of
potentially damaging legislation and it has always been the NAR
and their lobbyists who have protected this industry. They can
do it because they are so well funded and so well organized and
because the individual members all understand the importance of
having that kind of representation. The domain industry, as
young and as small as it is, needs to very quickly understand
that if they don’t have this same kind of representation, they
will not last. They will not be an industry, they will be
a footnote in the history of the Internet.”
Despite
the hurdles ahead Grant remains bullish about the long run,
predicting that current monetization methods will be
supplemented by new models. “I think we are going to see pay
per call, pay per action, much more sophisticated lead gen.
Ultimately the best domains will rise to the top and those will
be the big powerful generic domains. Many of those will move
from being a $200,000-$1 million asset to being a full
blown company that’s worth $30 million-$50 million and
I think that’s where we’re going to go next.”
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TrafficZ
CEO Ammar Kubba with Pat & Rob Grant |
“I
think a lot of today’s PPC companies like TrafficZ will morph
into development partners because they already have the client
base and they’ve already established the loyalties so I think
you’re going to see these companies approach portfolio owners
with development proposals. The owners will merge their domains
with the technology and the expertise of these parking
companies," Grant predicted. Sound unlikely to you? Visionaries
don't always have 20/20 vision, but with Grant's track record I
don't think I would discount anything he has to say about the future.
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