So first let me congratulate Rick getting this deal done and retaining a piece of the new business.
Now to the article and the comments.
The stupidest comment in the article itself by far is:
“The $3 million question for them: how quickly, if at all, will they make up for the price it paid”
Would TechCrunch ask that on reporting an investment in a start-up.
In another post from today, TechCrunch in announcing that MOBshop a start up just acquired $2.5 million in its initial round of financing, it did not ask, how long would it take until the investors get their money back. Nor did it ask how long would it take for the investors in the start-up “clickthrough”, which got $1m in funding, to get their money back.
Nor would TechCrunch, in announcing the acquisition of a company, ask how long would it take for the buyer to recoup its investment nor did it question Microsoft how long would it take to make back the $100 Million it is reportedly is spending to market Bing.com
Candy.com is a investment.
An acquisition in perpetuity.
You know what $3 million dollars gets you in a CD today, $60K. How long will it take you to make another $3 Million at $60K a year, 50 years.
But you say you always have the $3 Million in the CD, its not going anywhere.
Well neither is the value of the domain.
Its not going anywhere but up.
The comment place by “Fishing In New England” illustrates to this:
Is this the sign of a returning bubble? Or just someone who really likes candy.
Looking at some other purchases, totaling over $8M –
Well Fishing those sales aren’t recent by domain standards they are over a year old, in some cases a few years old.
So if those 4 sales total $8M, let’s look at some truly recent sales, like from this year:
Toys.com $5.1 M
So in the worst economic time in the last 70 years the top 4 sales this year, increased by 40%.
Domains are a pretty impressive investment if you ask me.
The stupidest comment on TechCrunch (of course its early in the day) however goes to 10things.me:
“I don’t buy it. it doesn’t make sense. the buyout of the domain for $3M smells like money laundering for (to) me.”
Of course you can expect to much understanding of the value of domains from someone who would go out and register 10things.me and then actually use the domain, like its the best one he has.
The best comment of the day belongs to Anthony Mitchell who obviously “gets it”
“””For that price, they could have bought a handful of television ads that would quickly be forgotten. Or print ads that would likewise disappear into obscurity. Instead some savvy candy company has etched itself into the minds of global consumers by acquiring a brand that nobody can ever forget.
The best values in online brands are found in the short, category-defining generics.