What is the Right Number for Rightside?

Rightside GroupRightside has rejected Donuts’ $70 million offer for its new gTLD domain name extensions, the company announced in a press release this morning. I don’t think this is a huge surprise given the company’s focus on the new gTLD domain name extensions.

In announcing the rejection, Rightside CEO Taryn Naidu stated, “We believe Donuts’ proposal is an opportunistic attempt to acquire Rightside’s valuable portfolio of domain extensions with an undervalued price and in a manner that would not be in the best interests of Rightside shareholders.”

When the news of the offer was announced a week ago, I posted a poll asking readers if they think Rightside should accept the offer from Donuts. It was a bit surprising to me, but nearly 57% of those who responded chose “no.” I say that it was surprising because it often seems that people who share comments on  my blog tend to be a bit anti-new gTLD domain names for whatever reason. I thought this might skew the audience to vote “yes,” but I would have been incorrect.

Now, the question I have is  what number would it would take for Rightside to accept an offer to sell its  new gTLD extensions? Even though I own  domain names I have no interest in selling, all of them would certainly be for sale if someone made the right offer. Heck,  I would sell  DomainInvesting.com for the right number!

In this morning’s press release, Rightside reiterated its projections for revenue generated from its new gTLD domain names: “As discussed on the Q1 2016 earnings call, Rightside is targeting annual Registry revenue over the next 3-5 years between $50 million – $75 million.” I presume they did so because they want to show that it would be short sighted to accept a $70 million offer for a business unit that is projected to bring in $50-75 million annually in just a few years.

I reached out to Taryn to ask if he would comment on what it would take for Rightside to sell its new gTLD domain name extensions, and I will update this article if I hear back from him.

Elliot Silver
Elliot Silver
About The Author: Elliot Silver is an Internet entrepreneur and publisher of DomainInvesting.com. Elliot is also the founder and President of Top Notch Domains, LLC, a company that has closed eight figures in deals. Please read the DomainInvesting.com Terms of Use page for additional information about the publisher, website comment policy, disclosures, and conflicts of interest. Reach out to Elliot: Twitter | Facebook | LinkedIn
  1. I believe this was the best offer they could get and no better one comes in future. I am sure revenue will go up, but so expenses. Peek of profit in nTLD business is at the beginning, later on more suffering will be experienced.

  2. Elliot

    I thought the offer was low as I said in my post, I would say certainly something north of $100 million and probably more like $150M

    Lets not forget that many strings have cost $10M-$40M just to acquire without regard to revenue and registrations numbers.

    • Without regard to revenue and registrations, la la land

      We all know Rightside is not capable, they dropped the ball since opening day, I wonder how many Donuts shareholders, are owners of Rightside stock?

    • Hi Francois, how are you? Wise, right…? Oooh, yeah… Haven’t heard from you for a very long time. How is going your selling of Domaining.com that you announced years ago? Still looking for right buyer? C’mon! We know you are all greedy. Best offers are gone. Just admit it!

  3. Mike, I am not sure to know who you are so it’s difficult for me to respond you accurately. If you do not mind to reveal me your identity or drop me a mail then I will be pleased to better respond you.
    FYI, in France we are charged an insane percentage of government taxes on benefice so after it’s hard to be competitive when selling something and for this reason I may look greedy when I assure you it’s not the case.
    Regarding “… best offers are gone”, I do not know, we have near 40 times more members we had in what I will call the golden age of domaining. But I admit it’s very different, there is no longer this positive energy there was at this time, at least it’s the way I feel, or maybe it’s just lassitude.

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