|
Fabulous.com
is Born
| "I ran across a domain that
was for sale on Sedo.com -“Fabulous.com,"
Warner recalled. "I liked it for a brand.
For what I didn’t know but when I showed it
to Dean he had me buy it without negotiating
for the $10,000 asking price."
That purchase paid great dividends for DBS and
continues to do so to this day. But at the
same time the new Fabulous.com was being born a
different birth
commanded Warner's attention. |
|
"We
were just launching our first iteration of products for DBS
and times were very busy when my wife gave birth to our
first child, Ella," Warner said.
"Unfortunately Ella had major complications and
was near death in the hospital. Her lungs hadn’t fully
developed yet. After an emergency hospital transfer and
several weeks of treatment she recovered. I was very close
to Ella at the time and we have had a special bond
every since. It is very easy to be engulfed by work
but quality of life and family is what really
matters"
Back
at work, "DBS floated in the first year after I joined
through a reverse takeover," Warner said. "Richard
and I tried to “corporatize” the company. We put in
management systems, incentives for sales and I benchmarked
everyone in the company with a system called “brainbench.com”
(a hugely unpopular move)."
|
Warner
had to make some tough
decisions during the Fabulous years. |
To
complicate matters, as always seems to happen in life,
another storm appeared on the horizon. "The Internet
had another mini bubble burst in actual revenue,"
Warner said. "This is December 2002 and the company was
heading into the red in a hurry. Staff needed to be
cut immediately, unprofitable products needed to be cut,
everything needed to be more efficient. So we did."
"The
benchmarking we had done on the staff had identified the
most skilled programmers and designers. That combined with
an exhaustive review created the basis to cut the fat out of
the system. Marginal and unprofitable products that had been
sacred cows were slaughtered, popular but
unskilled staff were let go - I even put myself up for
potential termination based solely on my salary (luckily
they kept me)," Warner said.
"The
outcome of this process was amazing. The staff which
had poor skills had been causing product and system issues
which took up the good programmer's and designer's time.
Training
|
| and retraining the
poor ones had been taking up all the
productivity of the better developers. As soon
as the bottom half of the programmers and
designers were gone the whole development
process quadrupled in productivity
with better quality of production,"
Warned noted. |
"Culling
the products had a similar effect. We focused on the
profitable production and pet projects were out. Finally we
had the production based on potential for revenue instead of
trying to justify why products had been created in the first
place. In fact, we were well on our way to creating a single
synergistic product with Fabulous.com. The product suite
included: Fabulous.com (Domain Registrar), Fabulous.com (Parking
Company), Roar.com (PPC Directory), PageSeeker.com (Paid
Search Engine) and DarkBlue.com (CPA Network)."
| "In
2002 we had already produced an internal product called the Dynamic
Generator. This was an unpopular product initially as it
replaced humans by dynamically creating websites
using search listings, search links, images, open source
information, CPA products, news, dictionaries, etc.
This product was developing dynamic websites long before
the rest of the market |
|
attempted it. The outcome of this
system was fundamental to DBS success in the early years
when search engines still ranked parking pages well in their
organic search. Without the added volume the company would
have had difficulty surviving," Warner said.
"We
also realized that the key to long term
profitability and stability was to own the traffic
internally," Warner continued. "Domain Active,
the internal holding company for domains, began buying domains.
We created a market intelligence engine that collected and
collated all the data we could find to “guess” the
traffic value of domains that either existed or hadn’t
been registered."
"As
a public company, we created a white
list system that could help determine if domains that
might have traffic and hadn’t been purchased yet had
potential trademark issues
|
|
| associated with them. Once
identified, Domain Active domains were purchased by hand,
prioritized by potential value. Over the years 600,000
domains were purchased this way making DBS the largest
domain portfolio owner by volume of domains." |
|
|
Dan's
daughters Sophie and Ella |
In an interesting side note,
Warner added, "In the following years I
went on as Chief Strategy Officer to create
relationships with Google and Yahoo
for DBS. This included a deal which was one of only two in
the world at the time which was non-exclusive between
the two providers. We could send traffic to either
as we saw fit. Eventually Yahoo
threatened to cancel the contract and DBS
moved exclusively to Google for the following
years."
In 2006, after years of ups, downs and all
arounds, Warner was finally enjoying an
ongoing hot streak, both in the office and at
home. "Another joy was added to my
life when Sophie, my youngest daughter,
was born. This time there were no
complications – life was good!," Warner
declared. |
|
| In
2008 Warner had another new baby to boast about - this one birthed by
DBS. "We broke out of the crowd again when we
introduced the Domain
Distribution Network (DDN)," Warner said.
"The DDN was based on a paper
I wrote and released to the domain community in October
2008. This paper was based on analyzing the value chain of
aftermarket domain sales and made recommendations for
change. |
|
| After discussing the
paper with the major
registrars they requested that we build the system that I
had proposed, and that they would support it. The DDN was
launched about five months later and went on to contribute a
significant liquidation mechanism for aftermarket domains.
It provides real time stocking, distribution, transfer, and
settlement of domains between any registrar listed on the
network. More importantly to DBS it added millions in profit
to the bottom line by selling its Domain Active domains more
efficiently," Warner said. |
|
|
He
is on the road a lot but Brisbane,
Australia (above)
is still the place where Warner makes his
home. |
2008
had other highlights for Warner too. "My family managed
to build a house of our own design, I finished my MBA
program with honors (of little value at this point) and I
made six overseas trips that year. The family was getting a bit grumpy!"
Warner said.
Of
course 2008 will go down in history for another reason - one
of the biggest recessions in history was starting to take a
big bite out of just about everyone's business. "The
global financial crisis is here," Warner observed,
"and Google is clawing back revenue share in
the new contracts. DBS is one in a long line of companies,
but
|
| we are the first
company to be reassessed. The margin that was
eliminated had been used for research and
development which no longer existed.
Costs are too high. More staff and product
costs have to go." |
Another
huge change, one even closer to home, was awaiting Warner in
the summer of 2009. "After significant discussions with
the board of DBS regarding the path forward for the company
we mutually agreed that my strengths in growth and
innovation were not going to be the core of the DBS
strategy going forward, and they appointed the CFO to the
role of CEO. My seven year stint with developing
Fabulous.com and Dark Blue Sea from a start-up was over."
That
however was not the end of the Dan Warner story - it was
just still another new beginning. "It was time again for
a fresh start," Warner said. "I had an interest in
open source development for years. The web solutions
that were being produced by Joomla and Drupal were
very exciting. I was also ready to run my own company
again. So I created an open source web development
company and merged it with an existing traditional
advertising company a friend of mine had owned for 22 years.
The result is Interweaving.com."
| "Interweaving
has been a phenomenal company experience. We have been
perfecting a manufacturing style process that produces
websites for less than $5,000 which would have cost $20,000
or more just a few years ago. It is based on an open source
content management system Joomla, and a system of |
|
| reuse that
accelerates production times. What I liked most about the
company was that I was able to interact with real small and
medium businesses and successfully launch or re-launch them
online. It combines business strategy and internet knowledge
to make a real difference and provide great value,"
Warner said. |
"We
got off to a great start and within a few months we
were producing around five websites per week. Revenue grew
to around $80,000 per month. In less than six months
we had built a business with more than $1 million in
annualized revenue. However, the business also required that
I work 16 hours per day and stress in the early
stages was unbelievable. I inherited many of our company
staff who were traditionally trained in advertising - not as
web developers. We were trying to keep our costs down, so
equipment was scarce and we didn’t want to hire dedicated
staff until we could guarantee a viable business. Almost
through sheer willpower we made it a success. Now
the business has several dedicated web staff and processes
continually improve and gain efficiency," Warner said.
| "Interweaving
was and is still a start-up. It needs tender loving care,
expertise, and experience. It was heavily dependent on my
own expertise in business strategy and the internet but luckily,
I had taken on a partner with it from the beginning so that
should I move on to my more global |
|
|
ventures he could run it. Last
November, when Directi came along and
made me an offer I couldn’t refuse to run DomainAdvertising.com
I had a means to have my cake and eat it too.
My partner runs the operations of the business
and I remain the Chairman and provide
strategic advice." |
Anyone
who has been in the domain business for any length of time
knows that it has a certain addictive quality to it. It is
an exciting place to be, there are a lot of great people to
interact with and domains are at the heart of the biggest
shift in the history of communications as traditional media
outlets move to the Internet. Though, with Interweaving, he now had a company
of his own again, Warner couldn't resist the siren call from
the domain industry.
"I’ve
had the benefit of knowing most of the people at the top of
the domain industry. Knowledgeable guys with sharp
noses for following the money. I’m not going to name drop,
but you all know who you are. I missed you the most when I
stepped outside the domain channel for those six months (a
much needed break). Well, I’m back and life
continues to be interesting – I guess I’m not dead
yet!," Warner laughed.
There
were practical reasons as well. "I felt that I had a
lot of specialist skills and knowledge I was really wasting.
Cash flow of Interweaving and payback on its start-up costs
still weighed on me. The business was just beginning to spin
off cash. I was cognizant that as a start-up it still
represented significant risk as a venture – Internet
markets can change overnight."
|
"Divyank
Turakhia, the co-founder of Directi (with his brother Bhavin),
gave me a call to talk about what I was doing. We had talked
over the years of my potential involvement at some point
with Directi, but I had previously been dedicated to
Fabulous until it had run its course - being loyal to the
cause and company that I had helped create. I had a number
of offers from other domain companies in my break from the
industry, but nothing had felt right, or interested me
enough to break away from Interweaving," Warned added.
"Divyank
had a straight forward and compelling offer including, to name
just a few things, complete autonomy, a team of 50 veteran
domain professionals, access to over 500 additional human
resources on an as need basis, strong capital
form Directi and the Ashmore Group and I could run
the entire company from an executive office in Australia.
As
a new company of Directi, a lot of people are not yet
familiar with DomainAdvertising.com, a new parking and
traffic monetization service
|
Directi
Co-Founder Divyank Turakhia |
| that describes itself as being
"a radically innovative traffic monetization program
that works hard at delivering the last mile of revenue and
conversions, bringing sustainable value to domain publishers
and advertisers." |
|
|
|
I asked Warner to elaborate on
that and explain why Domain Advertising was
created to compete in a space that has seen
huge revenue declines over the past couple of
years. "We have entered an established
market which has slowed
in development," Warner agreed. "It’s
like the ice
age has come and everyone is huddling into little balls
hoping to maintain the heat in their internal
core. This is a reasonable behavior as costs
have created a very cool environment." |
"What
we are going to do is create value faster than
anyone else. We can do this because our cost benefit ratio is significantly
higher than any other provider in the industry. I would say
that the primary driver will be that we have the benefit of
such a vast array of talent and experience at a
fraction of the cost of western cultures (most of Domain
Advertising's staff is based in Mumbai, India) - with
little opportunity for competitors to replicate our
position. We have an army of innovators.
A
mouth watering chocolate template from Domain
Advertising.com's landing page collection.
Other DA templates and info on their parking platform
are in this .pdf
brochure.
Warner
added, "Domain advertising and the industry will reach
a tipping point.
Domain owners should send their traffic to the best
provider for every individual domain.
Providers win traffic by being able to provide one
cent more than the other available providers at any
given time for any given domain.
Cutting costs, as most domain channel providers have
done in recent years, only allows them to be able to afford
giving the domain owner that extra cent for a little longer.
In the long run their lack of innovation and cost
cutting will bring them to a point where there is no
longer a cent to give. Then
they no longer have a reason to exist."
|
"We
are happy to compete on revenue on a domain by domain
basis," Warner continued. "We will stand toe to
toe with the competition and try to out-innovate them to
fight for your traffic. In the nature of diverse systems we
won’t be the best solution for every domain name, but we
are confident that a strong share of the market will fall to
us."
An
interesting factoid - Warner's formidable Army is as young
as they are talented. Believe it or not, of the 600 people
at Directi, Warner is the oldest despite being just 43 years
old himself.
In
closing Warner shared this final observation with us.
"Richard Moore once told me, “You’re a weird guy,
but that’s OK as this is a weird industry."
I didn’t miss the irony in his comments. In an age where
the Internet has redistributed wealth to Internet
entrepreneurs at an astonishing rate (making them 40%
of all millionaires) – It seems that the
geeks may inherit the earth after all."
|
Warner
allowing his head to be shaved at T.R.A.F.F.I.C.
Down Under in Nov. 2008
to raise money for cancer research. |
*****
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