|Yes, the bubble did burst, but Cahn barely got wet.
DomainSystems also conducted or assisted in the sales of such gems as eCommerce.com,
eToys.com, Mortgage.com, Celebrities.com, Hotel.com, Guns.com,
and many others. We ran out of zeros on our calculator before we
could total it all up. In the midst of disaster, with competitors on
all sides dying, DomainSystems thrived. We’ll explain how Cahn
pulled off that remarkable feat but first let’s back up a moment
and ask the obvious question, “Who IS
this guy?!” Your first thought is that he must be some kind of
real-life Joe Hardy
(the guy in Damn Yankees
who sold his soul to the devil so his hapless Washington
win a World Series).
In this case, Lucifer
had nothing to do with it (he was presumably busy working on VeriSign’s
business plan at the time). The story still seems supernatural
though, especially when you consider that ever since he was 13 years
old, Cahn knew exactly what he wanted to do with his life and by the
time he was 31 he had done it. It was only after reaching the
pinnacle of one profession that domain names lured him into another.
Cahn grew up in Cincinnati,
Ohio where his
parents ran a successful furniture business. Every week his mailbox
filled up with letters from his grandmother who lived in San
Diego where a biotech boom was underway. “She kept sending me
articles about this exciting new industry,” Cahn recalled, “I
soon decided what I wanted to be when I grew up! Starting in junior
high school I geared all of my elective courses toward a career in
the medical field.”
When he graduated from high school, Cahn crossed the Ohio
River to attend the University
of Kentucky, a
short drive down I-75
During his junior year at UK Cahn became an intern for a medical
equipment company and wound up shocking them by becoming their top
salesman! “They wound up putting a branch in Lexington just
because I was there,” Cahn said. Using his earnings to pay his own
way through school, Cahn graduated in 1987 with degrees in Marketing
and Biology and he would make great use of both disciplines.
Shortly before graduation Cahn had started his own business
marketing specialized cardiology equipment. Once he got his diploma
he decided to moved to South
he realized two things. One – the high ratio of physicians and
hospitals per capita would give him a bigger market for his goods and
Two – the weather and beaches in Florida are much nicer than the
ones in Kentucky.
In 1989 Cahn caught the eye of drug giant Eli
Lilly who recruited him to take over sales for a struggling
subsidiary they had in Miami. That branch of IVAC
Corp. was ranked
near the bottom of Lilly’s national territories at #111. Within
two years, Cahn had moved them all the way up to #4. Now it was time
for a really bold move.
“A group of other senior managers decided to join me and
go out on our own,” Cahn said. They founded Pyxis
based it in San Diego where his medical dreams had started with
those letters from grandma. “Pyxis invented automated medication
and supply distribution systems that are now used in almost every
hospital in America and around the world,” Cahn said. “We took
the company public then sold it to Cardinal Health, one of the
world’s largest drug distributors.”
As any entrepreneur will tell you, the real thrill comes
from the chase rather than the reward at the end. Cahn wanted a new
challenge so he started helping out another startup that had
invented an online medical records system. The company’s ideas
were ahead of their time but they showed Cahn the unlimited
potential of the Internet.
“In 1996, the son of one of my customers told me he had
been buying domain names because they were the electronic equivalent
of real estate,” Cahn recalled. “I liked what I heard and formed
a sideline business with him.” Together they started the first
domain brokerage on the net at NameShop.com, well before Great
Domains and Afternic
arrived on the scene.
Cahn also started building his own portfolio and soon left
that partnership to pursue bigger game. He wanted to handle the most
valuable domains on the market and established HitDomains.com
to pursue his goal. The company’s multi-million dollar blockbuster
deals in 1999 lit a fuse under the entire industry. In 2000,
HitDomains merged with another industry leader, SolutionHome.com,
giving Cahn a pair of talented new partners and a new corporate
The revamped company set up shop in Pompano
right in the middle of Cahn’s old medical stomping grounds that
had now become a hotbed of internet business activity.
Valueweb.com, Citrix Systems, Verio and IBM are all within 5
miles of the DomainSystems offices.
Cahn, who is now 38, serves as CEO for both DomainSystems and Moniker.com
approved registrar). 35-year-old co-founder Eric
Harrington is President
of the two companies. Harrington is a Michigan
with an MBA from Harvard.
40-year-old attorney Joel S.
completes the triumverate as co-founder, General
Counsel and Vice
is also the managing partner of his own law practice in Miami where
he got his Juris Doctor
degree at the University of Miami.
This is where things really get interesting.
DomainSystems.com was formed just as the bottom was starting to fall
out of the domain business. The earthquake that rocked the industry
leveled most other start up companies, but as Cahn surveyed the
rubble he saw only opportunities.
Some great domain names were
suddenly becoming available from companies that were now in
bankruptcy. Because of DomainSystems track record in brokering high
dollar deals, the courts usually turned to them to get the most
money possible from the remaining domain assets. “When many others
were stuck, we were hired and that helped fund our business while
times overall were tough,” Cahn said.
That is how Cahn wound up handling the sales of
eCommerce.com, eToys.com, Mortgage.com and some of the other blue chip names
mentioned at the top of this article. That process continues still
today with DomainSystems waiting for court clearance to begin
marketing the Excite@Home portfolio.
With their history of success and expansion into a complete
line of domain services (corporate domain management, expired/drop
domain services, traffic monetization services, registrations, brokering, traffic
monitoring, appraisals and hosting to
name a few) DomainSystems also began attracting business from
America’s largest corporations. Disney,
Miramax Films, Toyota, Proctor & Gamble, Bank of America,
the National Hockey League
and dozens more came to him to manage and protect their invaluable
domain assets. Cahn said “We maintain the
registrar and DNS management system to ensure uptime for our clients. To date
we have never
lost a domain and our registrar has never been down. No other registrar I know can make that
DomainSysyems/Moniker also has a
client list that reads like a Who's Who of high profile domain
industry figures. The roster includes BuyDomains.com, Thunayan
K. Al-Ghanim (Elequa of Future MediaArchitects), DomainDeluxe
and NameAdministrator among others. Cahn draws successful
clients like a magnet because he understand why they are
successful. "They understand the market and recognize the
domains that will result in the highest paying traffic," Cahn
said. "They also know when and at what price to sell a domain
when the right opportunity comes along. We have sold many names for
our customers which funds their various business opportunities and
DomainSystems acquired Moniker.com just last year and the registrar
has played a key role in continuing to attract major clients.
Originally known as MrDomReg.com,
Moniker started in 1999 when it became (and remains) the only
registrar to pass its ICANN accreditation and registry connection
requirements on its first
try. When Cahn bought the company it had only 1700 domains on the
books. Within a year, that number soared to over 150,000 and growth
Today Moniker is one of the five fastest growing registrars
on ICANN’s approved list of 160. They rank 19th in registrations
and Cahn says they will reach the Top 10 by this time next year.
“We continue to add 12 to 20 thousand registrations per month
while most other registrars are losing market share,” Cahn said.
“We expect to double our business in the next 6-9 months”.
For those more interested in the domain aftermarket, Cahn
said the average retail price realized by sellers who use
DomainSystems is the highest in the industry. “Being a one stop
shop featuring experience, legal and escrow has allowed us to
attract the most valuable domains to sell and that has kept our
average sales higher than the others.” Cahn added “We also have
contacts with the right potential buyers which gives us an edge when
marketing high profile domains.”
Whatever they are doing it is working. They now have several
hundred thousand domains and active websites listed for sale. Most
DomainSystems clients sell their domains through the company’s
combination For Sale/Pay Per Click pages as this allows them to
collect revenue from traffic while names are on the market. Cahn has
some good news for those clients and everyone else in the industry.
“We are seeing a huge upswing in valuations and that is a good
sign for the future,” he said. Six figure sales are even starting
to pop up again. “We are currently working on some big sales,
including Shanghai.com which we feel will bring in access of $350,000.”
Whatever service a client might need, Cahn intends to
provide it. Though resellers often debate the value of domain
appraisals, many companies and individuals require them for tax
purposes. DomainSystems covered that base long ago. “We invented
the first domain appraisal system and have done over 380,000
appraisals to date,” Cahn said. “The criteria from our system
are now used in more than 95% of all domain appraisals on the web.
Our appraisals are also accepted by the IRS
to value charitable domain donations.”
In January of this year, DomainSystems added the latest
piece to their corporate portfolio by launching their own web hosting
business, CoolHandle Hosting
While many of the company's enterprises are aimed at corporate level clients,
CoolHandle was designed for small business and individual
webmasters. DomainSystems/Moniker manages to keep all of their balls
in the air with a 10-person staff at their main office and an
additional half dozen handling web hosting support at CoolHandle.
While tending to his own business, Cahn also keeps an eye on
important developments in the industry at large. Though it is
currently on hold, VeriSign’s
proposed WLS system has certainly not escaped his attention. “We are
totally against WLS and are actively involved in a lawsuit against VeriSign
and ICANN. Monopolization of the market can only hurt the
industry as a whole, not help it,” Cahn said.
Those who support WLS claim it is needed to “level the
playing field” and give everyone an equal opportunity to acquire
the best expiring domain names. Cahn doesn’t buy that. “I
believe that domains are just like real estate. Anyone has the right
to buy property if they have enough financial and/or creative resources
to do so,” he said. “The difference is that our segment
involves a level of technological sophistication that many without
resources do not have. I believe that domains are a public
they are registered but then they become personal property.”
While some are jealous of the success the major players have
had in the expiring names market, Cahn believes those players are the very
thing necessary to have a thriving market. “Because
they know how to monetize the domains, our industry will
continue to grow and remain strong. Just imagine if all of our
domains were just registered and renewed and not making
any money or not becoming someone's dream business,” Cahn said.
“Many criticize those that capture dropped names first and use
them in unique and rewarding ways. But this is what keeps
everyone interested in this market and I believe it will grow exponentially as more people jump on the web.”
WLS is obviously a sore spot with Cahn and he views
VeriSign’s recently derailed Sitefinder
scheme (one they threaten to resurrect in the future) with equal
disdain. “I feel that Sitefinder is totally illegal and an unfair
marketing practice,” Cahn said. “VeriSign's move jeopardized the
technological structure and foundation of the internet. As a
registry and provider of registry services to registrars, they have
no right to hijack the unresolved domain traffic.”
Cahn clearly recognizes the value of traffic so, when you
consider how many great domain names have passed through his hands,
you have to wonder how many he has in his own portfolio. Cahn said
“I still have many of my original names from 1996. Most are domain
related or geared toward our business and future business ideas. I
was fortunate enough to grab a few 2-character and short word
domains that are valuable today, but I certainly don’t have the
quality of names that many of our customers like Ultimate Search,
Elequa and BuyDomains have.” Cahn added, “My partners and I have always spent
most of our time and our company’s time on providing services to
our customers rather than harvesting inventory for ourselves.”
Though 1996 was just 7 years ago it was a much different
world in domain terms. “Back then domains were $70 and sometimes
as high as $100 each. We registered about 1,000 of them so it was
quite expensive to maintain a large inventory,” Cahn said. “That
forced us to learn how to sell and monetize them very quickly.”
Cahn added that back then no one really understood the value of
traffic or search engine placement. “Today that is the most important valuation criteria rather than just the brand
name itself,” Cahn said.
So here he
is, just 7 years after entering this business, with a company that
is one of the largest privately held domain services firms on the Internet.
Asked to sum up what sets DomainSystems/Moniker apart from the crowd
Cahn said “We are unique. We are the only ICANN accredited
registrar that also has a thriving after market business, as well as
hosting and email services. No other registrar is offering all of
that and best in class service in one spot today.” Judging from the company’s past
they will be offering even more tomorrow.
you wish to contact Monte Cahn he can be reached by
email at Monte@Moniker.com
or by phone at 954-984-8445.
If you would like to comment on Ron Jackson’s article, write firstname.lastname@example.org.
If you missed our previous Cover Story click
on the headline below:
TO SEE THE WIZARD:
WILL WLS DEMOLISH DOMAIN DROP CATCHERS?
other previous Cover Stories are available in our Archive
to Domain Name Journal Home Page