Marchex CEO steps down

A new boss at Marchex and Q4 earnings released.

Marchex reported earnings today, and also announced that long time CEO Russell Horowitz has stepped down. Company co-founder Pete Christothoulou has taken over the top post.

The company, which derives the bulk of its revenue from performance advertising in which customers pay for phone calls, had a rocky 2014 after losing the bulk of its business from its biggest client. The stock trades for about $4.00 now, well below its 52-week high of $12.84.

Marchex also owns a large portfolio of domain names that it monetizes and sells through the Archeo Domains brand. The Archeo business reported revenue of $3.0 million for Q4 2014, and $14.5 million for the year. Both of these numbers are down from their prior respective periods.

Marchex sells $1.6 million in domain names in Q4

Marchex’s Archeo division continues to sell domains at fairly high prices.

ArcheoMarchex reported its fourth quarter earnings after the bell today. It included sales results from Archeo, its domain name division.

Archeo sold 262 domain names for a total of $1.6 million last quarter. That’s about double how much it sold last year in the same quarter.

It’s also a high average selling price of $6,100 per domain name.

Averages can be misleading, but I suspect Archeo’s median is also higher than what you see at Afternic and Sedo.

While the company is coming down a bit on its minimum pricing, Archeo still seems to be focused on higher average selling prices rather than volume.

There are some domains priced below $1,000 in its fixed price inventory. But only relative few.

Higher prices means more margin when a domain sells, but lumpier sales. It will be interesting to watch Archeo’s domain sales going forward.

Marchex and release earnings

Domain portfolio owner and large registrar group report earnings.

Two domain name companies released third quarter earnings results after the bell yesterday.

Marchex reported GAAP revenue of $40.6 million, compared to $33.7 million in the same quarter of 2012. Its adjusted EBITDA fell to $3.4 million from $4.8 million in Q3 2012.

The company is primarily a pay-per-call business, but it also owns the Archeo domain name business. Archeo sold 81 domain names last quarter for a total of $1.9 million., which owns domain registrars Network Solutions and, reported GAAP revenue of $125.2 million, up from from $105.8 million for the third quarter of 2012. Its non-GAAP measure increased 9% from a year ago. Its GAAP net loss shrunk from $21.5 million to $6.0 million and its adjusted EBITDA was $38.9 million, essentially flat from last year.

Marchex shelves plans to spin off domains division Archeo

Archeo will remain a division of Marchex instead of becoming its own publicly traded company.

ArcheoMarchex has canceled its plan to spin off its domain name business into a separate public company, at least for now.

The company announced plans last November to spin off its domain business into a new company called Archeo. Marchex had long neglected its portfolio of over 200,000 domain names, and making it part of a separate company would allow it to better monetize the asset.

Since then, the group sold some of its pay-per-click assets, which ultimately made the business too small (at this time) to justify the costs of being a public company.

It also seems that Marchex was going to miss the cashflow that the domain business throws off. The company also announced that it is going to use a portion of Archeo’s cashflow to fund an ongoing quarterly dividend.

Despite canceling the plans, Archeo will operate as a separate division of Marchex.

Company officials told Domain Name Wire that it is not changing its business model from what its plans were for the public company. In other words: Archeo will still sell its domains, buy new ones, and look for partnerships to develop its best domains.

An overview of the Seattle domain name circuit

Last week I visited the many domain name companies that call Seattle home.

Seattle is home to a large (and growing) number of domain name companies.

Seattle is home to a large (and growing) number of domain name companies.

Last month I took my annual family “escape the Texas heat” vacation to Seattle. I didn’t get the chance to visit any of the domain companies in the area while I was there, so last week I took a return trip to Seattle to rectify that.

The collection of domain name companies in Seattle is large and growing. This is not by coincidence. A couple domain name entrepreneurs in the area have had nice exits and started other domain ventures for a second act.

Other companies, such as GoDaddy, have moved to the area to take advantage of strong tech talent.

Soon you’ll be able to add even more Seattle companies to the domain name list. Perhaps, which applied for 76 top level domain names, will be considered a domain name company.

While my company visits were mostly for information gathering and introductions, here’s a quick run down of the visits.


My first stop was to visit Archeo on Pike Street. Archeo is the pure-play domain name company being spun off from Marchex. Later this year or early next year it will become its own publicly traded company.

Archeo has over 200,000 domain names, and earlier this week formally launched its domain marketplace.

Archeo excites me. Its domain portfolio has a lot of low-hanging fruit because it hasn’t been touched for years, which means we’ll see a lot of action in its portfolio over the next 6-12 months.

The company is also starting to acquire domain names again, which may present opportunities for domain name owners with solid portfolios or individual domain names. The company will obviously be smart about acquisitions, but there’s one more large buyer in the marketplace now.

Archeo is also looking to do strategic deals with companies and entrepreneurs that want to develop domain names. Plenty of companies have tripped up trying to develop domains, but if done correctly, this could create some great case studies for the power of good domain names.


Just down the street from Archeo is DomainTools, the domain name data company.

DomainTools’ office has an open, startup feel to it. All employees – including CEO Tim Chen – work out in the open. Meetings are held in rooms named after top level domain, e.g. the .org room. (Perhaps it will rename some of them after the launch of new TLDs.)

The company is working on some neat initiatives that I expect we’ll learn more about in the coming year.

Jay Westerdal

Next up I visited with Jay Westerdal, who founded DomainTools and sold it in 2008.

Although laying a bit low, Westerdal isn’t out of the domain business. He is involved with 11 top level domain name applications, a couple of which are uncontested.


The next day I drove out to visit with Donuts. Donuts is the largest applicant for new top level domain names. It originally applied for 307 domains but has since withdrawn some after settling contention sets.

The team at Donuts has basically every aspect of the domain name industry covered experience-wise. It’s also backed by $100 million + in financing and The Wall Street Journal named it the #14 top startup.

In other words: it’s kind of a big deal.

If there’s any disappointment to visiting the Donuts office, its that there’s no Krispy Kreme franchise located in the breakroom. That’s probably for the better; I suspect the company’s health insurer would jack up its rates if there were.

Demand Media

Seattle is home to much of Demand Media’s domain name operations, which will soon be spun off into its own publicly traded business.

That Demand Media’s domain group and Donuts are in the same city is not coincidental. Demand Media’s domain business is built on eNom. Paul Stahura, now founder of Donuts, founded eNom and sold it to Demand Media in 2006.

Demand Media’s domain operations cover the gamut of the domain business. In addition to eNom, the company runs expired domain service NameJet. It also has two dozen active new top level domain name applications and set up registry operations that will handle Donuts’ new TLDs.

While there I also picked up one of the popular .ninja mousepads. Someday these mousepads will sell for a lot on eBay.


My final stop was GoDaddy. GoDaddy’s quest for talent has stretched from Phoenix to Iowa to Silicon Valley and now to Seattle. Its new office in Kirkland is literally walking distance from Demand Media, which means quite a few domain people are bumping into each other while taking caffeine breaks at the same Starbucks.

The office is on Lake Washington. How’s this for a perk: work at GoDaddy’s Seattle office and you can literally drive your boat to work and dock it outside the office. That sure lends a new definition to “morning commute”.