RealEstate.com Purchased For $8.25 Million
According to TechCrunch.com in what may well be the buy of the century in the domain name world, Market Leader, (NASDAQ: LEDR) a provider of online marketing and technology solutions for real estate professionals, this morning announced the acquisition of RealEstate.com.
A Market Leader spokesperson informed TechCrunch.com that the purchase price was $8.25 million.
At that price, IMHO it certainly one of the best buys in the last 5 years in the domain space.
Considering that not only did Market Leader get the domain name for $8.25 million but it also “a network of more than 250 participating brokerage companies and “hundreds of other real estate domains” certainly makes an incredible buy.
According to the SEC filing Market Leader actually acquired almost 400 other domain names as part of the deal.
It’s pretty amazing of all the publicly traded companies in the real estate space including builders, REIT’s multinational brokerage companies just to name a few, the domain winds up getting bought by a company that is trading at only a $53 Million dollar market cap.
Marchex by comparison has a market cap of over $350 Million
The seller is LENDINGTREE, LLC a mortgage company which is also publicly traded on the NASDAQ (TREE) and also has a market cap of around $57 Million
The domain is registered with Brand protection company Mark Monitor.
Shares of Market Leader are up about 8% today trading at $2.24
Shares of Lending Tree are up $.01 at $5.25 a share
Had Lending Tree put the domains up for sale in a very public way, I believe the domains alone would have fetched $25 Million or above.
Consider that some knowledgeable people in the new gTLD space think that some of the best generic extensions could sell for $25M or above, this is simply a killer buy
Loading ...
The $8.25 million purchase price is disclosed in their SEC filings, see:
http://www.sec.gov/Archives/edgar/data/1298978/000119312511252864/d234365d8k.htm
Very cheap!
That’s one of the best domains in the world. Certainly an incredibly great buy at only 8.25 million. And yes, it’s a major mistake that none of the biggest players in the Real Estate business didn’t buy it for more than that.
What does it say about Lending Tree who sold it?
Shane
You can check out Lending Tree here:
http://finance.yahoo.com/q?s=TREE
You should recognize the company they advertise a lot on TV
$8.25 million well spent. My guess is that they were willing to pay more…
eRealEstate.com could be next. That one is owned by domain King.
If you look at the financials of the buyer and seller, they’re both dogs. But, the buyer has a better balance sheet.
George
Agreed and appreciate for a company with a market cap of $55 million to spend 15% of it on one purchase is a big move yet after the purchase it could be a dog no more
Awesome!!!
This is an amazing buy. It is a top 5 domain IMO. It is similar to a name like Insurance.com when you consider the category defining nature and the industry it represents.
I would think it could have potentially reached a much higher price on the open market. There are a lot of big companies who would have been interested.
Brad
dont forget, tree is a part of the IAC..barry diller owned ventures, which appeart to be solely focussing on the dating space, giving up on ask.com as well, their model with realestate.com was flawed from the get go….its a great buy, this domain has changed hands a number of times in the last 10 years without success in developing out, I believe it was purchased for around 1 million back in 1999 and then part of an acquisition by lending tree, would be interesting to know what the hundreds of other domains are…
the reality is that the online real estate space has been a complete bust, look at realtor.com, housevalues.com, reply.com, zillow.com (still not profitable)…this is a space no one has figured out how to monopolize correctly beacause for the most part all of the inforamtion is free, with 6% commissions on 180k homes, their is roughly 10 k for companies to try and capture on most median home sales, real estate is simply way to fragmented..
Was this a private sale that then became public?
@Jeff – Could it have been that the buyer approached the seller quietly without alerting the other big real estate companies, therefore keeping the sale price lower?
John
I was a private sale between two public companies that was reported to the SEC.
Remember those so called experts that said dot com is not necessary….
who is laughing now.
Oh wait—here comes the dot co man.
seems insanely cheap considering everything else involved
must have been a distress sale?
top 5 domain AND alexa 34k and 400 other domains
Jesus!
madness by seller, unless desperate
BS- Barry Diller is laughing now because he’s proved the dot com is unnecessary off he would never have parted with it
ie- He’d rather spent $500 million in TV ads because the domain alone doesn’t offer a differentiating advantage like the lending tree spots do- get three competitive bids and when we put banks to fight for you, you win… something like that the domain doesn’t convey that’s needed in branding- however the domain in branding makes a statement of authority which could be worth something if Barry cared about more than immediate sales- how much do we spend for a lead and how much do we sell if for
Once again the buyer is a software app confirming what I’ve been saying all along-software names versus search and lead names have the most value! Because here branding and stature DOES matter and leads don’t because they have distribution already.
It definitely went for way too cheap!
I believe the originally owner sold it to LT for $25 million back a long time ago.
From what I recollect, the original owner hand registered it plus about 20 out incredible names and has slowly sold them all off.
How about Domain Name for “Real Estate investment trust” or
widely knowned as REIT
reit.com is anyone guess
It’s an amazing deal for the buyer. It sold way under value by just about any measure except the Obama factor. It probably has tons of backlinks and gets loads of type-ins and SE traffic. “Real estate” is a huge search phrase. Realtors have big advertising budgets.
The bad news is that the real estate business is highly regulated. In the US, every state has different rules. I believe some states even require licensing for “real estate marketing” as a separate category in addition to standard real estate brokerage requirements.
Still, the domain has incredible potential. When the economy comes back, this domain could go cha-ching in a big way!
I am a former licensed real estate agent and former licensed real estate broker. I currently own the domain name RealEstateForSaleByOwner.com
Again, this tells you that Lending Tree must really be struggling due to the selling of one of their strongest assets.
Wait, so according to what LDS is saying above, the domain was sold at a loss this time around?
In fact if LT spent 3x on the domain ‘a long while back’, that purchase in itself could be reason they had to sell the company.
After all $25mm is almost 50% of the total of the total market cap, of either company in this transaction!!
How was this structured ?
“Considering that not only did Market Leader get the domain name for $8.25 million but it also “a network of more than 250 participating brokerage companies and “hundreds of other real estate domains” ”
Were the brokers given leads based on areas? under licence.
@mhb plan on buying stock ? Could be well worth it at 2.30 a share
Also if a company that eyes on going public- there view is probably let’s buy as many solid names as we can before we report to share holders imo. Get everything done before IPO.
So yes going from private to public company does need to disclose in there filings
Also Rick is going make a shit load when company goes IPO with equity. Again private companies now.
“When the economy comes back,… ”
I seriously am wondering if the US economy will ever come back.
Pricing…compare this to the toys.com or insurance.com sales, I think 8-10 million is probably spot on, do you really believe it would have sold for 10-20 million on the open market, then to who?
I dont think there were really that many buyers, look how long it took property.com to flip for under 5 million
Maybe I’ll get some more eyeballs on my REALESTATE.HN since the .COM is off the block — LOL
it’s the top domain sale of 2011, correct?
just ONE sale like this and I’ll be able to start ALL my most amazing projects!
it’s the top domain sale of 2011, correct?
just ONE sale like this and I’ll be able to start ALL my most amazing projects!
Alt
yes and no
Ron Jackson who is the official gatekeeper of such records and rightfully so, will probably not include it, as there was something else other than just a pure domain sold, a site, 250 “agents” customer lists etc and there were 400 other domains sold as well.
So its not a “pure” domain purchase for one domain.
RealEstate.com was developed by Lending Tree as a hybrid real estate brokerage brand. They created bricks and mortar local operating entities, all company owned. RealEstate.com generated tens of thousands of real estate leads (inquiries) per month from the million plus unique visitors per month. Overtime, RealEstate.com had closed most or all of the bricks and mortar operations and presently operates as a real estate lead generation company in the mid-large MSA markets across the country. Real estate brokerages pay on a revenue sharing model per closed transaction.
This was way more than a pure domain sale. RealEstate.com is an incredible internet brand.
Peter
DenverRealEstate.com
619,366 Unique Visitors from US alone last month according to Compete, 34k Alexa Rank, #3 in Google for “Real Estate” plus the other domains involved in the sale. It’s the bargain of year for sure and maybe for many years to come.
Was it sold based on current revenue multiple? I’m also not sure why LendingTree didn’t try to setup a public auction first or contact other companies?
Congrats to Market Leader! I’m sure they can’t wait to get their hands on the domain/website.
Very cheap IMO… A billion $ biz waiting to happen.
An incredible domain name & sale. Reminded me of Business.com and Loans.com, that level of quality. Can’t help but think that Lending Tree could have parlayed that into something more special than it was. Would like to see the list of the other domains included in the deal to see if any were geo targeted names like city + realestate.com.
Domain sales are looking strong in the face of global economic turmoil as markets stand on the brink. Are domain names safe haven assets now? Possibly, as growth on the Internet is likely to continue to boom even as world economies enter recessionary periods. Domains should be seen as an asset class both as speculative investments and as a store a value since supply of top names is limited and demand will continue to grow unabated for the foreseeable future.
RealEstate.com.au has a market cap of $1.5 Billion
FYI…Mike, you get a nice plug in their audio investor press release regarding the domain sale.
Don
Thanks for the heads up
any indication of what those other 400 domains were they bought?
Will a new gTLD called (dot)RealEstate be coming soon? If so, “Priceless”….
Peter
DenverRealEstate.com
Peter
I would expect so
I listened to part of the broadcast…your plug was in the first 5 minutes… I may circle back for the whole thing at some point…they mentioned that they got newhomes.com in the deal and may develop this as a seperate brand down the road, and that the other domains bring in around 250k visits per month, they also highlight the direct navigation benefit of the realestate.com url, its a great listen for those in the domain/seo space as it really validates the biz model and should be used in future negotiations for anyone trying to sell niche, targeted portfolios or vertical specific domains.
Not sure if they listed any other names, and have not been able to find this anywhere online yet, although I only made it to the 17 min mark of a 43 min presentation.
Please post here when someone finds out the 400 real estate names that went with this purchase.
@don
Can you please post a link to the broadcast?
here is the link:
http://services.choruscall.com/links/ledr110921.html
I am surprised that Lending Tree had such a small market cap considering they have been in business for so long. They must have some real troubles.
I’m listening to the broadcast as writing and it starts quite interesting. Would really like to see what other names are part of the portfolio but only newhomes.com is mentioned.
It appears that re.com is also part of it and these domains are also hosted on the same host, along with hundreds of rather crappy realestate-related domain names:
domania.com
serviceright.com
performlocal.com
itsoldfor.com
Definitely an interesting move. A smart one, too, considering the market for new homes right now. It’s kind of amazing that domain names go for so much.