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February 08, 2017

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Here's the The Lowdown from DN Journal,
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to fill you in on the latest buzz going around the domain name industry. 

The Lowdown is compiled by DN Journal Editor & Publisher Ron Jackson.

SumoMe Acquires Sumo.com for $1.5 Million Ending a 7-Year Quest to Acquire Their Dream Domain - Founder Noah Kagan Tells Us How the Deal Finally Got Done

The founder of SumoMe, a popular website services company that has operated from SumoMe.com, finally has his dream domain and new brand name after acquiring Sumo.com for $1.5 million. Austin, Texas based serial entrepreneur Noah Kagan, the founder of both SumoMe and AppSumo, filled us in on how the sale came about before he publicly announced it today. Our interview is below:

DNJournal: Premier domains like this are not easy or inexpensive to come by and I understand your quest to acquire it was a particularly stomach churning ride. Take us through it from the beginning – when and why you decided to pursue the name, how you made contact with the owner and how the negotiations played out.

Noah Kagan: We started to pursue the name on April 3, 2010!  It's taken nearly 7 years to acquire it. The owners were unresponsive so we found an introduction to them through a mutual contact on LinkedIn. The owners would respond and then stop for a few months. We hired 3 brokers and none were able to get the owners to budge on selling. When we got on the phone and then made the 7-figure offer, 

Noah Kagan
SumoMe Founder

things started to get more serious. I kept persisting as the owners would be unresponsive. Ultimately I gave them the large offer and a strict deadline which helped motivate the situation to a close.

DNJournal: I understand the owner had asked for as much as $10 million at the height of last year’s Chinese buying boom. While you got it down to $1.5 million that is still, obviously, a very significant investment. How do you expect having Sumo.com to recoup that investment for you? 

Noah Kagan: They did ask $10 million for Sumo.com and I told them they were crazy. I look at the domain as a long-term investment. The brand value, improvement on recruiting and personal satisfaction should recoup our spend within a year in my opinion. We also structured the purchase with monthly payments so we didn't have to spend it all at once which made the investment much more digestible. There's a large value on happiness and being the de facto Sumo brand on the market now and forever is nearly priceless to me. 

DNJournal: Hundreds of new domain extensions have been released over the past two years. Did you ever consider using one of these new extensions rather than making the large cash outlay you did to get the .com?

Noah KaganHa! Yea, we own sumo.ly / sumos.com and I spent 2 years trying to buy sumo.me. It felt like we were settling for second place when we knew what we wanted. Similar to real estate, there's only one Beverly Hills in the world and it's very expensive to live there. Everyone knows its prestigious and one of the nicest places to live. That's what .Coms are. You can definitely live a great and prosperous life in Santa Monica (.IO or whatever) but the status that goes with a dot com is still the de facto TLD. For instance, name one large public company that doesn't have the .com as their main brand.

DNJournal: For a large enterprise changing a name – even to a great, more intuitive one – involves a good bit of work. What has been involved for you and your team in making the transition from SumoMe.com to Sumo.com?

Noah KaganHoly moly. You don't realize how many places and logos your name appears. We've spent about 2 months transitioning the name. There are things anyone buying a domain should do as well is leverage the purchase for PR exposure. Specifically we've:

  • Updated our logo to go along with our new name

  • Reviewed every place where SumoMe is mentioned

  • Updated all our LinkedIn profiles

  • Attempted to get the social accounts of the new domain

  • Setup articles with relevant press sites like your own and more.

DNJournal: Are there any other details you think would be of interest to our readers regarding this major acquisition?

Noah KaganPersistence beats resistance. For anyone else out there really wanting a specific domain, figure out the leverage you can get to acquire it and start the process earlier. Two major changes if I had to do it again would be to use a fake email address personally if you have an online presence. This would have not let the seller necessarily know why we are using it and potentially charge us a premium. Second, I would have pushed harder to purchase the domain sooner, likely would have been able to save a million dollars doing it that way!

DNJournal to readers: Thanks to Noah, who was one of the first employees at Facebook, for sharing his experiences with this sale. He is probably right about saving a lot of money had he pressed to close the sale years ago. Rob Barbour of MarketingFools.com, the mutual friend who introduced us (a big thank you to Rob for that as well), told me the previous owner of Sumo.com had acquired the domain in 2008, just two years before Noah first contacted him, for $150,000.

(Posted February 8, 2017)


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