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Nice Guy Finishes First: How Frank Schilling Won the Domain Race After Starting at the Back of the Pack

If there is any man in the domain business who truly needs no introduction, it's Frank Schilling. By now just about everyone has heard the name, read the blog and marveled at the numbers. He owns hundreds of thousands of high quality generic .com domains and annual revenues for his closely held Cayman Islands company, Name Administration, Inc. are estimated to be in the $20 million range. Despite enjoying a level of success that would turn most people’s heads, Schilling, now 38,  remains unchanged and is universally regarded as one of the nicest people in this (or any other) business. These are all things you have likely heard before, but to borrow a line from Paul Harvey, now it’s time to tell the rest of the story.”

Frank Schilling
Name Administration, Inc.

Schilling built his phenomenal domain empire from scratch despite taking the field just five years ago, when almost everyone else thought the game was already over. Prior to “going public” last February when he started his popular Seven Mile Blog Schilling had gone about his business very quietly. With little publicly known about his personal background, some speculated that he must have come into the business with a lot of money to begin with. How else could he start in 2002 and still build such an empire when everyone “knew” all of the good names had already been taken by those who pioneered the space in the 1990s?   

The answer is what I have often said is the domain industry’s “dirty little secret” - hard work. That is how Schilling got where he is today. When he started his funding was limited to his relatively modest life savings and a string of credit cards that he quickly maxed out. Schilling literally bet the farm on his dream and ended up creating one of the greatest business success stories you will ever read.   

He did it despite growing up in a country that didn’t speak his language and going out into the world with little formal education. What Schilling did have was a family that showed him what you 

Russian tank rolls through Prague during 
1968 invasion of Czechoslovakia

can achieve if you are willing to work for it and the lessons he learned from them have guided him throughout his life. Though most think of Schilling as a transplanted Canadian who now lives in the tropics – his real roots extend to Germany and the small town of Teubingen where he was born. 

Schilling’s dad Ray was a medical student and his mom Tina was an elementary school teacher. They appeared to have a bright future ahead of them but the Cold War had everyone on edge. After the Russians invaded Germany’s eastern neighbor Czechoslovakia in 1968 the Schillings began to fear that Europe was a powder keg that could eventually explode. They lived under that cloud until 1971 when Ray and Tina finally decided to move their family to North America.

They considered the United States but America was entangled in its own war in Viet Nam at the time and no one knew how long that conflict or America's military draft would continue. Ray and Tina had two young sons and did not want to see them conscripted when they reached their teens, so they decided to take the boys to a new home in Canada where a sister, four years younger than Frank, arrived to fill out the family. They landed first in Hamilton, Ontario but soon headed further west, settling in Langley, British Columbia, just outside Vancouver.  

Schilling told us “My first memories of Canada are standing on the street in front of our house, having neighborhood kids ask me “What’s your name?”  over and over…and I couldn’t answer them because I only spoke German. Too funny…“What’s your name?”…really funny given what I do for a living!” Today Schilling has hundreds of thousands of names but little else was funny about those early years in a new country. The immigration was a family hardship because his father’s medical credentials didn’t count in Canada. So Ray went back to med school in Canada while Tina supported the family working as a substitute teacher.  "We were poor,” Schilling recalled. “We had a home (that Ray built himself) but there was no money left for anything else.”   

By the time Frank reached high school the family’s financial situation started to improve a bit but a much more severe storm was about to hit. “In the 80s my father finally became licensed to practice medicine and the family started to do better as dad had an income, but when I was 16 my brother died from an asthma attack. He was my best friend. When we came to Canada nobody spoke English so we spoke German and learned English together - we were buddies. I had trouble focusing after that and it affected me throughout my last two years of high school,” Schilling said.   

“I never did graduate, falling two credits shy, and my dad was worried. Both he and my mother were great students and very book smart while I was a terrible student and more street-smart. My dad hoped I’d follow in his footsteps as a physician but I didn’t  

have the grades or focus for medical school and to be honest, the family didn’t have the money. My dad was a great physician, but a terrible businessman and social medicine in Canada paid very little relative to what U.S. doctors made,” Schilling said.    

Schilling did get a diploma a year later after making up credits in math and science but he floundered after leaving high school, spending the next few years living at home and working odd jobs. He had always been fascinated by television - loved Miami Vice, music videos and TV Guide was his favorite publication so he finally decided to enroll in a film school in Vancouver. “I graduated a class ahead of Clerks movie director Kevin Smith and moved to Los Angeles to try my hand as a writer,” Schilling said. “I sold two monologue jokes to the Dennis Miller Show and that’s the extent of my success in televised entertainment!”    

Six months later Schilling went back home to Canada and, five years out of high school, enrolled at the University of British Columbia. That stab at higher education didn't take either and he soon abandoned college to sell real estate with a friend, Vern Jurovich, who was doing well in the field (as fate would have it, Schilling would later help Jurovich enter the domain business and 

Frank & Michele Schilling

they remain close friends and business associates today). “I did okay in real estate,” Schilling said, “but it was a feast or famine business. I made about $50,000 a year after expenses, so it was a living.” Much of that real estate revenue came from houses that Schilling – drawing on skills he had learned from his father - built himself. 

The real estate business would end up providing Schilling with much more than a living though – it would also bring him together with his wife Michele. “I met Michele through this English lady in our real estate office,” Schilling recalled. “She was a realtor who had just sold Michele’s dad a condo and she set us up on a blind date. In 1996 we got married at the Little Church of the West in Las Vegas on a $500 budget!”    

After the wedding, Schilling took on a series of sales jobs while continuing to build and sell houses in his spare time. In the late 90’s he advanced to a position as Senior Manager of Sales and Marketing for a Vancouver videogame accessory maker. Things were looking good but life was about to take another sudden turn  

In 2000 Schilling happened to read an article in a small town newspaper that would end up 

changing his life dramatically. “I was visiting my parents who had moved several hundred miles away and read in the local paper about a guy who had sold a dozen domain names for more than $130,000! I  was immediately intrigued and started searching the Internet for information about domains. I stumbled onto GreatDomains.com and later Afternic, but I couldn’t get any good names so I tried brokering names…and that’s how I met Garry Chernoff,” Schilling said.   

Schilling called the legendary Canadian domainer on behalf of a client to inquire about the availability of one of his domains – Fastener.com. The client would pay up to $100,000 but Chernoff  felt the category-defining name was worth more. They couldn’t cut a deal but the conversation led to a close friendship that has grown even stronger over the years.  “Garry is the one who taught me about internet type-in traffic and making money with traffic,” Schilling said.   

Chernoff told us, “What impressed me most about Frank was his unwavering thirst for knowledge on acquiring domain names. He was nothing less than a man possessed. He quietly contacted the guys who were getting all the domains on the drops and carefully pried bits of information from each of us until he had completed the first page of his road map to success in the domain biz.” 

“Another thing that  has impressed me about Frank is his ability to think differently than most and capitalize on new acquisition techniques. This thinking resulted in his uncanny ability to thrust ahead of the pack relatively late in the game and in short order look down smiling from the top of the domain heap. Another great attribute that really helped him acquire 

Schilling with his "mentor" Garry Chernoff (left) 
reunited at T.R.A.F.F.I.C. East - October 2007

knowledge in the beginning is his unmatched charm and likeability. He genuinely loves his fellow man and cares deeply about everyone around him. How can you not love and want to help a guy like that? He balances wealth with compassion better than anyone I know,” Chernoff said.

While Schilling credits Chernoff for getting him started in the domain business, Chernoff said he also got a huge benefit from the relationship. “Frank is the man who has kept me in the game, grinding it out all these years. I remember thinking back in 2000 that getting decent domains would be over very soon. Frank proved me wrong and gave me the competitive boost that kept me going. I probably would have quit and settled into complacency years ago had I not developed a friendship with him,” Chernoff said. 

When Chernoff showed Schilling how he could earn revenue from affiliates 24 hours a day by putting their links on his landing pages, Schilling felt like he had finally found his calling in life. Online gambling operaters paid some of the highest affiliate fees, so Schilling began assembling a portfolio of generic gambling-related domain names that attracted people searching for online casinos. He eventually decided the real money would be in running his own online casino and Schilling put all of his chips on the table in a bid to reach that goal.  

View of Caribbean Sea from Schilling's 
current home on Grand Cayman Island

He and Michele sold their house and the remaining homes Frank had built and emptied their retirement accounts to build a $200,000 war chest. They also decided to move to Grand Cayman Island where they felt the absence of income and property taxes would help their money go further. Most other online gambling operations were also based in the Caribbean so it looked liked the place to be to get ahead in that business.  

Things did not go as planned. Schilling’s domains were not getting enough clicks to produce the kind of revenue he would need to open his own casino. Even 

worse, he learned that the Caymans actually banned online casinos even though they were legal in other Caribbean nations. To top it off, under U.S. government pressure major banks had started blocking credit card transactions with online casinos. By April 2002 his casino dream was in tatters.   

However Schilling still had several thousand gambling domains as well as some decent domains in other categories that cumulatively earned about $300 a day. He decided to take a detour and try to scale that revenue higher by building a large portfolio of income producing domains representing all areas of commerce. He believed that growth of the Internet itself would bring more advertisers online making all of the traffic domains he acquired more valuable as time went on.   

His timing couldn’t have been better. The .com bubble had burst in 2000 and prices for good domains had become affordable again. Disillusioned owners were even letting high quality domains drop rather than pay renewal fees. Valuable names were falling left and right but Schilling was convinced the web was here to stay and that the value of those domains would eventually soar again. 

Though Schilling was convinced he was right many did not share his optimism at that point in time. Though she never left his side, even Michele was thoroughly alarmed as Frank sank all of their savings in domains (along with the funds available on their credit cards). But he made smart choices 

Just another day in paradise. 
Frank at home in the Caymans.

in the domains he went after and as the revenues they produced steadily increased he poured the proceeds into still more domains. He was soon spending hundreds of thousands of dollars a month with dropcatchers like SnapNames and Pool.com.    
 
He was also spending every waking hour in front of his computer scouring expiring domain lists.  He landed a few nice one-word names like Antarctica.com and Fettucine.com but most of the 

Schilling's pre-2004 photos were lost in 
Hurricane Ivan
but he resurrected his 
"long hair" look for us in this photo.

great one-worders remained out of reach. His bread and butter became highly descriptive two-word commercial terms like Chapter11.com, DrugProblem.com and AntiguaHotels.com and even three-word names like DiamondWeddingRings.com – any  term people were likely to use in searching the web for a product or service. 

He burnt the candle at both ends and in the middle, often working 20 hour days while swilling coffee to stay awake. Before long he had a pretty good impersonation of Howard Hughes going on. “My hair got long and I turned skinny and snow white,” Schilling recalled. People who hadn’t seen him for months mistook him for a tourist on the rare occasions he ventured out.   

But Schilling's single minded pursuit paid off. Within a couple of years he had bagged over a quarter of a million domains and revenues for his company, Name Administration, cracked the 8 figure mark annually. Bigger fish were starting to take notice. Marchex, the first public company to buy a major domain portfolio (Yun 

Ye’s $164 million collection) wanted Schilling’s list too and made an offer of over $100 million to buy it. Schilling was inclined to accept but Mother Nature intervened to upset that apple cart.

In September 2004 category 4 Hurricane Ivan slammed into the Cayman Islands. Schilling had gotten his family on the last evacuation flight off Grand Cayman before the storm hit. Though they were safe their home was destroyed along with everything in it. Their cars were also wrecked but the biggest loss was their computers and critical domain data they needed for the audit Marchex required to complete the purchase. It would take months to rebuild the information and as that process dragged on the deal dissolved as Marchex focused on concluding the Yun Ye purchase. Ironically, Schilling was the one who helped them make contact with the reclusive Ye.

  

Hurricane Ivan flattened everything in its path when the 
storm tore through the Cayman Islands in Sept. 2004

In a further irony, the missed opportunity proved to be a blessing in disguise as Schilling’s portfolio has soared even higher in value and if sold today would command considerably more than the 2004 offer. “I have been approached about selling my business five times over the past four years,” Schilling told us. “Each offer was extensive and written, three of them were accompanied by deposits and all were nine-figure deals of ever increasing magnitude. I seriously worked with each suitor. Things just never worked out for one reason or another and I take that as a sign of sorts. I suspect I will sell my business one day but I am reasonably certain I will never leave the name business entirely, nor would I want to. This is too good a space,” Schilling declared.

Asked to amplify on that, Schilling said ”Everything on the Internet begins with a name and there are very few people who understand how domain names work or their importance to commerce, branding etc.  Even folks who think they understand branding, don’t get the power or importance and versatility of names - they too miss the boat. This is the ultimate niche during the ultimate window in time and it will be for decades.  You could say that I sell my business (get liquidity) every month when the traffic wires roll in and although I could sell names to 

Schilling talking about his favorite subject - domains - at T.R.A.F.F.I.C. East Oct. 2007

generate even more liquidity, I would prefer to keep the portfolio whole and wait for software/tools to become commercially available, allowing me to develop on a large scale and create a media company of permanence.  I may be expedient but I’m becoming more patient with age.  And I recognize how truly lucky and blessed I am. I’m happy to wait until somebody sees what I see or until the opportunity to segue into a different stage comes along.”

Schilling added, “I think people inherently “get” that anyone could build the next billion dollar internet based company and for all the fluff, posturing and protocol, it all begins with a simple domain name which anyone can register for $8.  A world of possibilities and dreams for the price of a Big Mac meal!  I think the domain industry will continue to grow, mature and gentrify, regardless of who tries to control it. Google has greatly assisted the domain business by democratizing search. They have returned power to the people and the canvas for all people starting an “internet work of art” is the domain name. I think today’s large registrants will become tomorrow’s new media companies.”   

Considering that five years ago Schilling’s financial status was no different than the vast majority of those who are reading this article right now, I asked him what were the biggest benefits his newfound wealth have brought to his life. “The most important dollar I ever made - the one that made me shout for joy and feel rich - was the dollar it took to allow me to work from home and to stop going to an office. Everything since, everything, has been anticlimactic for me. I only really notice that I have money or the significance of having money when I spend it to buy something and then I remember how hard  (impossible) it would have been to buy that thing

before the domain business.  I have really enjoyed being able to travel and stay in large hotel rooms. I’ve enjoyed being able to buy privacy by traveling privately and to surround myself with “space”, Schilling said.   

Another big change in Schilling’s life, one affected just this year, was his decision to put his life and business in public view. He now speaks frequently at domain conferences and interacts daily with all comers through his blog. When people are building a business they do not want to let potential competitors know what they are building – but now that Schilling’s empire is established, letting the cat out of the bag is no longer a concern. “It is precisely as you suggest,” Schilling said. “The business had matured to the point…no...beyond the point where it was hyper-competitive and needed to be kept secret.”   

“The seed for the blog was planted by reading years of what I viewed as incomplete or misinformation on domain forums and chats. There were private guarded chat forums which were password protected where the marrow of the domain business was discussed. It just felt like it was time for an industry insider to speak openly and render opinions for further discussion - to fuel open conversation about the space. I finally began blogging at the encouragement of Tia Wood who somehow got hold of my email address and asked if I published anything she could read. I told her no,  but I’ll start today!” Schilling laughed.  

That was back in February and he has been at it ever since. “Blogging is a challenge in the sense that I feel I owe readers my best effort even when my heart isn’t in it that day but I am learning to balance” Schilling said. “The greatest reward from blogging is having people who write to tell me something I

wrote six to nine months ago changed their life or business. That something seemingly small that I did, made a huge difference to somebody else. Life’s like that I suppose. - it’s often the little things that matter most,” Schilling observed.   

The little things Schilling does has made a difference to a lot of people. In 2004, about a year after I had started DN Journal and at a time when it was still building an audience, I got a phone call out of the blue from Schilling. I of course knew of him but we had never met or spoken before and I had no idea he knew who I was. This was before any major domain conference had been held so few of us in the industry at that time had met face to face (what a difference three years has made – now hundreds of domain professionals have met personally and become friends thanks to the the first T.R.A.F.F.I.C. conference in October 2004 and the many trade shows that have followed it). Schilling called just to introduce himself and let me know he liked the publication (he also gave me some sound advice on buying domains that I regretfully did not follow!) but I was very impressed that he went out of his way to be helpful and offer encouragement to a stranger  

When Schilling talks wise people listen. T.R.A.F.F.I.C. 
Co-Founder Rick Schwartz pays attention to what Frank 
has to say as he and Schilling prepare to participate in a 
blogger's panel discussion at T.R.A.F.F.I.C. East 2007.

Prior to his debut show in 2004, T.R.A.F.F.I.C. Co-Founder Rick Schwartz was on a Caribbean cruise that stopped at Grand Cayman. He took the opportunity to meet Schilling who had already been a member of his domain forum for several years before they finally met. 

“Frank is a legend for a number of reasons," Schwartz said. "First because he is the nicest guy you would ever want to meet. He is like the Jack Kennedy of domains. Second, he came fairly late to the game but never whined that he got in too late. He just put his nose to the grindstone and put together the #1 domain portfolio in the world nearly overnight. His portfolio 

has a low value of about $500 million and a real value likely over $1 billion…and third, did I mention that Frank is one of the nicest guys you will ever want to meet?!  I see him as the #1 ambassador for our industry,” Schwartz added.    

Dozens of others would say the same thing about Schilling who has managed to remain unaffected by his success. “I’ve heard that money like alcohol, reveals who people really are - strips away the veneer,” Schilling said. “I genuinely like people - all people - and I’m a pretty happy guy. I just try to be myself. I’ve never forgotten who I am and I have a pretty good memory. I remember how hard it was for me in the past and what it’s like to have nothing. I’m the same guy - putting more zero’s in my bank account doesn’t change my memories or who I am. It doesn’t make me any better or make me special,” Schilling said.   

Schilling also hasn’t forgotten what the domain business has done for him. He has given back in a big way as a founding member of the Internet Commerce Association, a non-profit group
dedicated to protecting the rights of domain name owners. Schilling has personally donated $100,000 to the organization since the ICA was founded in the fall of 2006 ($50,000 to help get it off the ground and $50,000 more to help keep it running as the ICA recently entered its second year of operation). “I like the ICA concept because, similar to Rotary, it allows you to give back to the space you thrived in. I really don’t give enough there because I don’t physically have the time, but I donate and am very proud of the group’s ideals which are truly pure and high-minded,” Schilling said.   

Schilling and ICA Legal Counsel Phil Corwin (right) 
speaking at T.R.A.F.F.I.C. East 2006 in Hollywood, Florida

While reflecting on the twists and turns he has experienced in his life, Schilling said “I wake up every day feeling so grateful for the life I have. Reading my history you can see how I could have just as easily settled into a life of invisibility and gone from struggle to struggle with nobody ever knowing or caring about it. I have no formal education, no marketable skills and I don’t focus well. Yet I’ve still thrived and have made more money than everyone in my family tree before me combined. Why did this happen to me? All I can do is be eternally grateful and give back wherever I can,” Schilling concluded.

*****


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