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March 26, 2014

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How Category Defining Domain Names Are Helping Jesse Stein Turn    Triton Web Properties Into an E-Commerce Powerhouse

By Ron Jackson 

 

Jesse Stein
Founder & Non-Executive Chairman
Triton Web Properties

Over the last five years serial entrepreneur  Jesse Stein and the Coral Gables, Florida based company that he founded, Triton Web Properties, has been quietly assembling a portfolio of top-notch category defining domain names. Triton has reeled in gems like Hobbies.com, Biking.com, Boating.com and SportsMemorabilia.com with one goal in mind - to use each of their acquisitions as the foundation to build a globally recognized, profitable e-commerce business upon.

Triton's business model is all about quality, not quantity. While some companies in the space have portfolios stuffed with hundreds of thousands of domains, Triton's collection barely numbers in double digits. That's because they have no interest in trying to make money through parking or domain sales. Each one of their e-commerce friendly names is now, or soon will be, a fully developed business with its sites set on being a leader (or the leader) in its space.

That is certainly easier said than done and it would be easy to dismiss such talk if the 41-year-old Stein didn't already have a long 

track record of starting, operating and exiting web-based ventures. As has been the case with many entrepreneurs, that success came only after valuable lessons were learned from a business bust. Stein told us about the ups and the downs in a journey that we think anyone who wants to run their own online business will find illuminating. 

Stein's story starts in an unlikely place for a guy whose working life would end up revolving around creating new businesses. "I was born in San Francisco in 1970 to two parents who were walking advertisements for the hippie era," Stein said. "They got married in a park in 1969 in robes with a peace sign on the wedding cake. They took me to see Bob Marley and Van Morrison before I could walk. Both were talented artists and loving parents. Their creativity and unique world view helped me venture to the unfamiliar side of the river in life. It probably also cultivated in me an ability to think up and execute on business ideas from slightly unconventional angles."

Stein was also strongly influenced by his grandparents, Adelene, Lynn, Yudy and Eleanor, who were unfailingly optimistic and supportive (Adelene and Eleanor are today a beautiful 91 and 93, respectively.) "I thankfully never inherited any money. Instead, my grandparents generously sponsored twenty years of education, from kindergarten through graduate school, and encouraged me along the way to follow what I loved." Yudy served as an especially strong role model in business "He was a self-made entrepreneur and my personal hero," Stein said. 

Stein started emulating Yudy at a very early age, carrying around his own little briefcase when he was just six years old. The entrepreneurial seed continued to blossom from there. "When I was 10, I’d collect tips from our party guests for serving drinks. At 15, I mowed lawns, sold luggage, cold-called for Dean Witter and dreamed about going to Wharton one day," Stein recalled. 

Stein would in fact make it to Wharton (the world famous business school at the University of Pennsylvania) - but not 

The Wharton School of Business at the 
University of Pennsylvania where Stein 
earned his MBA/MA degrees.

before he expanded his horizons with some other stops along the way. He went to college at the University of California at Santa Barbara and after graduation headed to Japan where we would spend the next five years working in Tokyo

"My first job there was door-to-door sales in Japanese, where I was one of only 9 foreigners in a company of 2,000 Japanese," Stein said. "Even though I had previously spent a year abroad attending Japanese college, nothing could prepare me for the morning “chorei”, in which the entire office would line up and shout out corporate slogans while bowing maniacally. I was a fish out of water. After that, I spent 4 more years in Tokyo working as a financial journalist. On the side, I had fun co-authoring “The Tokyo Nightlife Guide”.

After his Japanese adventure, Stein decided it was time to head back to the States and pursue another one of his dreams - a degree from Wharton. "I decided to apply to grad school at Wharton and the admissions director must have been crazy the day he read my application, because miraculously I was accepted and graduated with an MBA/MA from Wharton and UPenn’s Lauder Institute," Stein said.

Jesse Stein on a visit to 
Colorado earlier this year.

"Though I wouldn’t trade my Wharton experience for anything, in more ways than I imagined it taught me what NOT to do in business. The school taught us to be perfectionists - to perform mountains of analysis before making a business decision of any consequence. Fresh out of Wharton, I thought I’d take this ethic of perfectionism, combine it with the theories and concepts from the classroom, and take the business world by storm. Boy was I wrong," Stein said.

"My first real business, an online retailer of apparel called SmartCasual.com, was a classic “dot bomb”. We spent way too much time analyzing and precious little time executing. Both the business and our venture capital evaporated quickly. Trying to learn from this setback, I realized I was at my best when I ignored the MBA obsession with perfectionism. And I also noticed that the entrepreneurs I admired most – from Andrew Carnegie to Richard Branson to my Grandfather – were known for pulling the trigger quickly in the absence of perfect information," Stein said.  

Stein (right) with his SmartCasual.com partners and lifelong friends, Adam and Wayne.
This venture turned out to be a "dot bomb" but taught Stein some valuable lessons.

"So, in successive ventures I began to 80/20 more decisions, living by kind of a “screw it— just do it” mentality. I found that in most areas, good is enough and making it perfect takes way too long. As a result, I began to seize opportunities faster, get more done in a day and strike gold more often."

"Together with two partners, Paul and Wayne, I founded, grew and sold a Manhattan-based online advertising agency - Soho Digital. Over a period of four years, we grew the company into an interactive agency with 200 clients, 35 employees and $32 million in annual revenues. Clients included Delta Airlines, NBC, Starwood Resorts and AT&T Wireless. In 2004, we sold Soho Digital to an online media network funded by Insight Venture Partners."

Thinking back on that life changing deal, Stein noted, "Even after my Grandfather passed, I remained magnetically attracted to him: that advertising agency was headquartered just two blocks from where he worked for 50 years!"  

A happy Jesse Stein on the day in 2004 when his company Soho Digital was sold.

After the Soho Digital sale, Stein and his partner Paul started and ran multiple Internet-based ventures. "In 2006, we started and ran an online direct-response company focused on developing from scratch and marketing – exclusively on the Internet - health and beauty brands," Stein said. "The companies created and launched 9 branded products and acquired over 950,000 customers. Within three years, we grew the business to $45 million in annual revenue and 150 employees. All aspects of product development, fulfillment and customer service were built and managed in-house. All customers were acquired via targeted pay-per-click and display advertising. The flagship product, Dermapril-SP, was one of the best-selling anti-aging skin creams in 2008." The next year the partners cashed by selling a majority interest in the company.

Another major development in Stein's life came around the same time he and Paul were starting up the health and beauty products business. "My family and I moved to Key Biscayne, Florida from New York City five years ago all because of a CraigsList posting," Stein said. "I posted a simple ad for a one-week apartment swap. As luck would have it, a wonderful family living in Key Biscayne responded. We did the exchange and ended up falling in love with the island: a bi-cultural, bi-lingual paradise filled with laid-back, interesting people — all within striking distance of a great city in Miami.  We returned for good just 9 months later and we haven’t looked back."  

In May of 2005 Stein made a trip to Las Vegas to attend a conference that would ignite the interest in buying and developing top tier generic domain names that has consumed him ever since. "I attended my first T.R.A.F.F.I.C. conference and realized then that there might be an opportunity to combine my online-marketing experience with a small portfolio of category-killing domain names," Stein said. "Over the next four years, I attended several T.R.A.F.F.I.C. shows and benefited from people like Alan Hack, who was especially gracious in mentoring me. I realized I was way late to the parking game, so my only shot was to develop."

Stein attended his first domain conference in May 2005
This scene is from that T.R.A.F.F.I.C. show in Las Vegas.

"In 2006, I started my domaining journey by purchasing SportsMemorabilia.com. I had owned and operated two SEO firms over the years, so we started immediately optimizing the site for Google. SEO is considered the “Holy Grail” of traffic sources because of its low associated customer-acquisition cost. Thankfully, of any traffic channel, SEO is most thoroughly part of our business DNA. For the last four years, no other Website in the category has come close to ranking as highly and consistently on the major search engines across a majority of the revenue-producing keywords in the memorabilia category."

"We designed and launched a website, acquired suppliers and built an SEO-friendly technology platform that would handle all workflows around eCommerce. We also realized we knew nothing about sports. So, we brought on Stefan Tesoriero and Mike Gallucci, two eminently talented executives who have forgotten more about the business of sports than I’ll ever know," Stein said. "Since then, we've added more superstars and currently have an operating group I'd match up against any of the best teams in online retailing."

"Fast forward four years to today and the property – once just a lonely domain name -- is an Internet Retailer Top 500 website and the leading online retailer of autographed memorabilia outside of eBay. The company enjoys attractive EBIT margins and an operating team that’s second to none. But it all starts with the domain name. The one-of-a-kind nature of the domain name “SportsMemorabilia.com” has conferred business 
value beyond our expectations. It has opened doors to suppliers, vendors and strategic partners who wouldn’t have given us the time of day if we were something like “AAASportsMemorabilia.com”, Stein noted.

The team behind SportsMemorabilia.com

The success of SportsMemorabilia.com also provided the Triton team with a road map they could use as a business model for additional domain assets. "We decided to go after a small number of other category-killing enthusiast domain names," Stein said. "In the 11-month period between January and November 2010, we bought Boating.com, Yachting.com, Biking.com, Barbecuing.com, BabyFormulas.com and Hobbies.com, folding them into an umbrella company called Triton Web Properties."

"We mapped our proprietary technology platform – now 5 years in the making – to those other names, uploaded product and began the SEO process. Some of those names are starting to get a nice amount of traffic, but mainly we’re letting them slowly build authority and trust in the eyes of the search engines. Our plan is to build each one into the market-leading website in its respective category," Stein said.

Another part of the Triton strategy is to get where they plan to go on their own. "For better or for worse, our ventures have been entirely self-funded," Stein said. "Funding working capital out of our own pocket enforces a level of discipline that might not be there if it was somebody else’s money. Not being beholden to outside investors has helped me control my own destiny and really design exactly the lifestyle I want, which is a privilege I don’t take for granted. Additionally, it has helped me be more nimble, as I can make significant changes to businesses on the fly without having to explain to stakeholders why I’m doing it. Though access to more capital and a professional board would be nice, I feel the self-funding model leads to significant business and lifestyle advantages," Stein said.

Jesse Stein white water rafting with his family. These rapids can be tricky to navigate, 
just as those in the business world are. Stein says self-funding his ventures 
allows him to be more nimble and make quick decisions when necessary.

"But again, it all starts with a name," Stein noted. "A one-of-a-kind domain name opens doors and strengthens brand recall, ad click-throughs, direct “type-in” traffic, conversions, time-on-site and repeat customers. For example, for the customer seeking sports memorabilia through a search engine or other online referral source, the name “SportsMemorabilia.com” creates an instant psychic affirmation."

"Consider a user skimming the top-ten Google results for “sports memorabilia”: in 5 to 10 seconds they will choose between the names SportsMemorabilia.com, AllAuthentic.com, SteinerSports.com and Framethestars.com. Which name will the average user be more likely to make an instant connection with?  The SportsMemorabilia.com name is not just a brand, it also conveys what it is.  It defines the industry," Stein said in closing.

If someone asked you to define the importance of a category killing domain name in 25 words or less, those last two sentences from Stein would do the job nicely (with seven words left to spare). With a solid foundation of such names to build on, Stein and Triton Web Properties are well positioned to make major waves in the e-commerce world.  

  *****   

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