news $88.5 million appraisal value Frank Schilling’s domain portfolio that GoDaddy acquired

[News]

GoDaddy (NYSE: GDDY) has assigned an $88.5 million accounting value to the approximately 375,000 domain names it acquired from Frank Schilling this year.

Technically, GoDaddy acquired three businesses from Frank Schilling. GoDaddy also acquired Over in the first quarter, which obscures the total consideration paid to Schilling...

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[Name Trader]

That must be an undervaluation. 88,500,000/375000 = $236 per domain. Must be a whole lot of crap in there

 

[Samer]

That must be an undervaluation. 88,500,000/375000 = $236 per domain. Must be a whole lot of crap in there

Is Schilling still in the domain game?

Where is Schilling.

 

[Name Trader]

Maybe they should have used their own GoValue service to value the domains. They would have got a higher value, for sure But looks like they used Estibot

 

[gabri3l]

Why would they undervalue them? Wouldn't they pay less tax if the domains had a higher accounting value?

 

[Recons.Com]

That must be an undervaluation. 88,500,000/375000 = $236 per domain. Must be a whole lot of crap in there

Think of it this way. Around 350 000 of those names are hand reg, closeout and low xx auction type. Let's say with average of around $30 wholesale worth. 350k x 30 = 10.5 million.

Another 20 000 names are mid xxx names at average of 500$ per name. That makes another 10 million.

And then you have 5000 really good names at $68 million divided by the number, at around 13,600$.

That sounds quite fair to me.

In other words, 236$ per name for the whole large portfolio is usually a very good price. I would definitely sell mine with that valuation.

 

[The Durfer]

They dont wont to feel bad if the domains dont sell at that price, and they will be happily surprised if they sell for more. Its a comforting number. lol.

 

[Name Trader]

@Recons - Sounds reasonable. It would make me a mllionaire also. I could forgo some small quibble about keeping any domains

Also, Frank was always a master of the deal. He could sell snow to an Eskimo in the winter

 

[Bob Hawkes]

I agree with @Recons.Com (nice calculation, thanks!) that spread over the entire portfolio $236 seems to me a really reasonable average. Not only is their huge variation in quality, but also when one does a bulk purchase of an entire portfolio, there is a sure price today versus a possible sale a number of years in future for each domain name. If we thought that on average these were selling retail in $2000 to $5000 per name, representative of some of the big retail sellers shown on NameBio, I would think one would buy at most at 1/10 of that. Of course all off this valuation is for investor and tax purposes, so there are probably considerations that went over my head .

Bob

 

[Kpett]

Since I have trimmed my portfolio, if I sold all of my domains at an average price of $236, I wouldn't even break even. I have invested over $236 each in many good, quality names, so my average investment number is higher ... not as many hand-regs left ...

 

[Recons.Com]

Since I have trimmed my portfolio, if I sold all of my domains at an average price of $236, I wouldn't even break even. I have invested over $236 each in many good, quality names, so my average investment number is higher ... not as many hand-regs left ...

There are portfolios of few hundred names with average value of high five to low six figures.

There are portfolios of few thousand with average value of low five figures. There are portfolios of tens of thousands that can have average value of mid-high 3 figures. But, if you get to hundreds of thousands of domain names, you certainly have absolute majority of those hand reg/closeout/$xx auction quality and $236 is a very good average. You can buy a good quality LLLL.com at that price.

 

[Name Trader]

Why would they undervalue them? Wouldn't they pay less tax if the domains had a higher accounting value?

Speculation: Maybe they aren't making any money?