interviews Inside Interview: Why Packet Paid $350,000 for Packet.com

Inside Interview is a series in which we talk to buyers of high-value domain names to discover why they purchased these names, and what they’re doing with them. In this edition, we’re speaking with Jacob Smith, CMO of Packet, a cloud computing company based in New York.

In 2018, Packet made the momentous decision to acquire the Packet.com domain name for $350,000 from domain investor Braden Pollock. Here, we talk to Jacob about Packet, and how they came to acquire the Packet.com domain name.



When did Packet launch?

We started Packet in June 2014 and launched our service for customers in February 2015.

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Can you describe what Packet does?

Packet is a leader in the cloud computing space, focusing on bare metal and edge deployments. We help companies like Sprint deploy and manage dedicated computing infrastructure, but with the automation experience of the cloud.

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How did you initially come up with the brand name Packet? What was the process involved in brainstorming for your brand name?

We searched for a long time to come up with the name, but in the end, it was simple! In cloud networking, data is transferred across the internet in something called a 'packet' - think of it like a digital package. It's also the one thing (network connectivity) that you have to buy from your cloud provider, and it is becoming more important each day.

We decided that this was a great fit - easy to remember, English language word and descriptive of our core value to users.

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Did you consider domain availability when choosing the Packet brand name?

Since we are targeting a younger and very technical audience with a more "consumer" purchasing behavior, brand is very important. We made sure that we could acquire relevant domains to reinforce the brand throughout the buying experience. Our first domain was packethost.net, and then we acquired packet.net soon after we started the business.

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When did you initially look at purchasing the Packet.com domain name?

We tried to buy packet.com early on, but it wasn't accessible - the domain seemed to be in limbo and we couldn't reach the owner. We ended up with packet.net which is a meaningful TLD for developers and network people.

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Was your decision to buy Packet.com influenced by your successful Series B funding in September 2018?

Somewhat. The fundraising certainly gave us a bit of room to consider a larger brand investment, but it was something we had been discussing seriously for about 8 months previously. This is because the business was maturing and our Enterprise customers attached less value to the .net TLD.

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Did you use any tools (e.g., automated appraisals), services (e.g., manual appraisals, domain brokers), or data (e.g., sales data, search volumes, search results) to determine your best offer and/or the value of the domain?

We worked with a domain broker who had represented us in the packet.net transaction.

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Was it an easy decision to buy Packet.com for $350,000? Did any of your team need convincing of its value?

It's never easy to spend $350,000 on a domain, especially when things are going well without it (the majority of our business up until this point has been inbound lead generated). In the end, we agreed that our brand was an increasing part of the value of the company, and we wanted to ensure we had that locked up as a priority. To make it balance out, we reduced spending on some other marketing initiatives.

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Since the domain acquisition, have you noticed a spike in traffic or increased user attention that can be attributed to the purchase of Packet.com?

While we have less confusion among our Enterprise clients, the domain acquisition hasn't directed impacted traffic. Transitioning a primary domain is a nuanced process, especially regarding SEO but also with brand recognition (many users actually refer to us as Packet.net, thinking that is the formal name of our company).

We took a noticeable hit in organic traffic for a few months while everything transitioned, but we're in a good / growing place again.

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What do you feel that Packet.com adds to the Packet brand? (for example, does it add extra trust or a sense of permanence?)

It certainly erases the negative impression that Enterprise users had when they tried to visit packet.com before we owned it. While they would often find their way to .net, it was a poor experience and lowered the value of the company in the eyes of our biggest prospects. We no longer have that problem!

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What would be your advice for startups considering acquiring a premium domain name?

Not all startups compete against truly household names, but those that do tend to invest heavily in a clean, clear and memorable brand.

I would suggest that startups try to avoid domain brand confusion, either by picking a name that is unique or by investing in the assets to support a more common name. Either way - get it done and then invest in the things that really create value: your product, your community, your brand promise, and how you treat your customers.

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Thanks to Jacob for a fascinating interview! One of the key points from that interview is, I think, that before the acquisition of the domain, Packet’s enterprise prospects often visited Packet.com by mistake before ultimately finding Packet.net, an experience that lowered the value of the company.

If you’re interested in finding out more about Packet’s services, or you want to follow Packet’s progress, you can follow the team at their Twitter account, @packethost.

This interview has been edited for clarity.