CreditCards.com Files for IPO

CreditCards.com has filed to raise up to $115M in an initial public offering.

Earlier this morning, CreditCards.com, an online credit card portal that built its business around a valuable domain name, filed to raise up to $115M in an initial public offering. Although the exact valuation of the company is not yet known, the company’s S-1 filing with the SEC validates my previous assumption that the 2006 purchase of the company was north of $100M.

In October 2006, we paid approximately $133.8 million in cash (including approximately $350,000 in transaction fees and expenses) and issued approximately 2.1 million shares of Series A-1 convertible redeemable preferred stock at a price per share of $7.82 to the owner of the Predecessor in exchange for substantially all of the assets of the Predecessor.

That values the company at more than $133.8M.

Internet Real Estate Group sold the domain to Click Success in 2004 for “only” $2.75M. Daniel H. Smith pocketed $97.7M from the sale to an Austin Ventures-backed group in 2006. The purchase by the group in 2006 from Click Success was financed partially with debt from American Capital Strategies (NASDAQ: ACAS).

CreditCards.com’s S-1 filing is a treasure trove of information about the company’s traffic (they actually have more than one domain driving traffic) and earnings per visitor. In the first half of this year, the company received 5.899M visitors and earned $4.64 per visitor. The traffic was up only slightly from the same period last year, but revenue per visitor increased 46%:

The increase [in revenue per visitor] was primarily driven by higher number of offers and conversion rates of website visitors into submitted or approved applications and higher prices that we negotiated and received from credit card issuers.

In 2006, CreditCards.com had $43M in revenues and a net income of $18.4M. That net margin shows why a business based primarily on a domain name and search engine optimization, and which carries no inventory, is such an appealing investment opportunity.

Comments

  1. RF says

    Andrew,

    Cannot find the link to the S-1 filing that you discussed in article.

    Please post a URL link to the S-1 filing that talk about.

    Thank you.

  2. says

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    Para: jfmil@hotmail.com
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    kindly send us in a secured address where you want the consignment to be delivered

    KINDLY SEND US THE FOLLOWING INFORMATION
    COMPANY NAME
    POSITION HELD
    DIRCET TELEPHONE/FAX

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    Dr. kingRoger LA VIA SEGURA PARA DIRECTO DEPOSITO ALA CUENTA.
    —————————————————————————————–
    1- ABIERTA ON price america
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    direccion ————————————– charle summer no.54 los prados
    eletronica ————————————– http://www.price smart.com
    telefono.809-334-3434
    fax. 809-947-9535
    RNC. 1-0180187-5 CUANDO ENVIEN EL MESSAJERO DIPLOMATICO,ESTE el mensajero conlos datos enviado puede abrir una cta. ya.los cuales ustedes ya poseen- a BENEFICIO. de juanfranciscoacevedo
    ced.001-0366530-3 cualquier servicio al cliente le dara la informacion dela cuenta de ahorros.si abren una cuenta favor de dejar la libreta y la tarjeta con el official de cuenta en el banco.al cual reclamare. katia es la clave gmazx. one. avisar por cual de las 3vias es donde depositaron los valores. att.
    juanfranciscoacevedo
    ced.001-0366530-3
    numero.tarjeta.
    price smart.6801-093341
    code.0001
    fecha.12/19/06
    factura no.36238
    registro.juan acevedo
    evangelista acevedo
    jfmil@hotmail.com: ok
    Dawn M.: What is that?
    jfmil@hotmail.com: the full one
    Dawn M.: I do not understand?
    jfmil@hotmail.com: the following
    jfmil@hotmail.com: 3089
    jfmil@hotmail.com: keeping one
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    Dawn M.: What is 3089?
    jfmil@hotmail.com: paso ala clase superior.ela orden the one
    Dawn M.: What is all of this? Some if it is not even in English. I can only chat in English.
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  3. says

    Bizak has an earnings per visitor (EPV) calculator that allows you to compute both earnings and revenues per visitor based on your input of visitors, revenues and costs. The next update to the calculator will have the Bizak Estimate valuation based on those figures.

    http://www.bizak.com

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