Untitled Document

A web designer working on a site for him told Grant he should register his company name RobGrantRealEstate.com but (even though he did take that domain) he had bigger ideas from the start. “Nobody here cared about Rob Grant – what they cared about was Adirondacks Real Estate and I felt that is what they would look for.” When he looked to see who had AdirondackRealEstate.com he was surprised that it was available for registration. He quickly took it then, convinced that he was onto something big, went on to take thousands of other .com domains starting with a city, state or country name and ending with “real estate.”

At that time Network Solutions had a monopoly on domain registrations so it cost about 10 times what it costs to register a domain today. So, Grant laid out a huge amount of capital on a theory that most thought would never pan out. Also keep in mind that back then there was no PPC, no Yahoo and no Google, so the domains had only one apparent value – their generic brand value. Grant said, “my hunch was that as the Internet grew and developed these intuitive brands would take on more value as property and assets.” That was the beginning of Grant’s remarkably deep Real Estate Directory.

Grant hooks a big one.
Photo shot earlier this month (April 2008)
off Anna Maria Island, Florida where
Grant has a vacation condominium

Grant soon started taking his idea global, sweeping up key real estate domains outside the U.S. “That was really an exciting time because no one had thought to go international,” he said. “There was very little resistance, unlike today when there is so much competition.” Though Grant was focused on real estate he realized that this same phenomenon would happen in many other industries. “If you could own a keyword term for a particular industry that was a very significant asset so I picked up some in other categories too, like TropicalFish.com, CaribbeanResorts.com, LiteraryAgents.com, BookPublishers.com and MusicPublishers.com”

On the downside, the more domains Grant piled up the scarier it got because of the extremely high annual registration and renewal fees at that time. “It was brutal,” Grant said, “because you had these high carrying costs but absolutely no revenue. You really had to believe. I feel it was the true test of whether or not someone has vision. I sat for years paying these registration fees and not earning a nickel and wondering if I was out of my mind.” Grant, who piled up over 8,500 domains (many are featured at WebMediaProperties.com), added something that a lot of guys (including me) can also identify with - “my wife also wondered if I was out of my mind!”

Rob Grant and daughter Caroline at a Jan. 2008 DOMAINfest Global Conference party. Considering
the yellow python around his neck, Rob is
obviously not a guy who scares easily!

Grant not only held on when the .com bubble burst in 2000 (reinforcing critic’s views that domain investors were nuts) he used that as an opportunity to buy up more high quality assets as others panicked and sold out cheap. “They had decided they had made a bad move, that they had been in it long enough and they had made a bad investment and they were getting out. I remember buying good domains for a dime on the dollar,” Grant recalled.

“I can’t tell you how many times people told me to get out. That the domain thing was over – especially the techie guys. They never got it. They didn’t have the marketing background and I know they kick themselves to this day for not understanding the true value of these names,” Grant said. “I’ve seen so many peaks and valleys since 1996 and in each valley there was a washout as people get scared or got discouraged and got out. Then a new generation would come in with a new sense of conviction.”

Grant’s belief in real estate domains has never wavered and today there are now multiple ways to monetize those domains. He has some leased out through LeaseThis.com and there is always PPC, but he said the best returns can be realized through lead generation. For example he has HawaiiRealEstate.com, representing a state where the average home sale is $750,000. A single lead to a licensed broker in Hawaii can be worth up to $45,000.

Grant did better than that with a listing on his CatskillsRealEstate.com site several years back. Though his company was several hours north of the Catskills, he won a listing for a very large multi-million dollar estate and marketed it through his Catskills domain. He ended up selling the property in house with no help from any Hudson Valley or Catskills area realtors, giving him the full commission – approximately $150,000. “This showed me that with the Internet you could reach out beyond your traditional territory – you were no longer restricted by conventional boundaries which might extend maybe 50-70 miles from where your agency was,” Grant said. “It was a great case study for me.”

With his business thriving and interest in the Adirondacks reaching a new high, Grant started looking for ways to give back to a cause he believed in. A few years ago he settled on higher education, especially small schools like his Prescott College alma mater. Again drawing on his marketing background and the power of domains he felt he could help quality schools that were struggling to compete more effectively with better endowed institutions that were chasing the same pool of students.

“By giving them intuitive domains we felt we could help them increase their admissions and also increase their brand exposure, “ Grant said. “We started with Paul Smith’s College in our neck of the woods in the Adirondacks. They had a very enlightened president who was receptive to the idea so we were able to work with them to build a network of domains that effectively drove traffic to the college’s website. All they needed was one applicant enrolling from the program for four years to gain $120,000 in tuition. We started by giving them $10,000-$15,000 worth of domains and they were very excited with the results so we went on and gave increasingly larger gifts to other colleges.”

The donated domains are appraised by Moniker.com and though many appraisal

Paul Smith College President
George Miller (left) with Rob Grant

companies tend to come in on the high side (to ensure happy customers who will come back and order more appraisals) the long list of appraisals I saw for names Grant donated were on the very conservative side. This is probably why Moniker’s domain appraisals are recognized and accepted by the IRS.

Grant made a portfolio gift valued at $60,000 to Prescott College that included Conservationism.com, FinancialGrant.com, LiberalArtsDegrees.com, MastersDegreePrograms.com and many others. He followed that up with another portfolio of 107 domains valued at over $99,000. A portfolio valued at over $237,000 went to his daughter Caroline’s present school, St. Lawrence University in Canton, New York. In 2006, a portfolio of 225 domains valued at more than $371,000 was given to the College of St. Scholastica in Duluth, Minnesota. Paul Smith’s College also got new gifts totaling over $84,000.

The schools have been thrilled with the donations. Grant has also consulted closely with school officials on how to best use the domains. While there is a lot of value in redirecting keyword domains to the the individual school’s websites, some are moving beyond that. St. Scholastica is setting up a committee to work on building out some of the marquee domains given to them. Both faculty and students will be involved in those projects.

The Adirondacks

Grant is now expanding his program beyond colleges to other community organizations and non-profit groups. He also provides hosting services and website marketing advice to many groups in his area. More details are available at Grant’s Adirondacks.com website.

Adirondacks.com is one of about 1,500 developed websites that Grant operates. It includes a busy travel section and Grant is now applying the same formula to travel guides in Florida and Vermont. Though domain development has just become a front burner issue over the past year as PPC revenues have fallen Grant has been developing properties for ten years now. “It takes a lot of hard work, you’ve got to have the right content, you have to continually refresh that content and you have to have a sales team that goes out and gets the advertisers,” he said.

Development is just one of many ways Grant has financially diversified in recent years to protect himself from shocks in any one category. “In addition to our real estate brokerage, we operate a self storage business, we have a big vacation rental business, I operate a 23,000 square foot office building, so we have both commercial tenants and residential tenants. One of the lessons I learned early on was that it is very important to be as diversified as you can be. You can’t rely on any one business model because if you do you will be taken out. I’ve seen it time and time again and I’ve had it happen to me. So anytime I see an opportunity to create a business, or even just another revenue stream, I do it.”

Grant has been around long enough to see just about every conceivable up and down in the business cycle. With the general economy now going through a major down cycle, I asked him what he thought about the domain industry’s prospects over the next year or two. “I think we’re going to go through a very intense period and I think we are going to go through another shakeout. We have seen these rough patches historically in the domain space and I think

right now we are faced with multiple threats. There is going to be more and more dangerous legislation created that could take our domains away and I commend the Internet Commerce Association for everything they are doing to combat that and everyone needs to understand how important it is to support the ICA” Grant said.

Grant added, “The National Association of Realtors (NAR) understood decades ago how important it was to have an organization that could lobby on Capitol Hill and the NAR is one of the most powerful lobbying groups in the world. What we have seen in the real estate industry is wave after wave of potentially damaging legislation and it has always been the NAR and their lobbyists who have protected this industry. They can do it because they are so well funded and so well organized and because the individual members all understand the importance of having that kind of representation. The domain industry, as young and as small as it is, needs to very quickly understand that if they don’t have this same kind of representation, they will not last. They will not be an industry, they will be a footnote in the history of the Internet.”

Despite the hurdles ahead Grant remains bullish about the long run, predicting that current monetization methods will be supplemented by new models. “I think we are going to see pay per call, pay per action, much more sophisticated lead gen. Ultimately the best domains will rise to the top and those will be the big powerful generic domains. Many of those will move from being a $200,000-$1 million asset to being a full blown company that’s worth $30 million-$50 million and I think that’s where we’re going to go next.”