Userlist Upgrades from .io to .com; Was it Worth the Purchase Price?
There’s a really interesting startup called Userlist that helps companies with the entire lifecycle of email to customers, from the first welcome email, to all transactional emails, and even account termination. They recently migrated from the .io top-level domain to .com, and there’s an excerpt of an interview I want to share with you.
Hey everyone! Thank you so much for joining me on today’s DNAcademy podcast. My name is Michael Cyger, and I’m here to help you become a more profitable domain name investor and entrepreneur.
On my run this morning I was listening to one of my favorite podcasts called Startups for the Rest of Us, where host Rob Walling helps entrepreneurs build, launch and grow their startups. There’s a link below, so if you’re into startups and podcasts then I recommend you subscribe.
Rob interviewed Jane Portman of Userlist, a software-as-a-service company that helps businesses with customer lifecycle messaging. Userlist describes themselves as more efficient than building an email lifecycle system yourself, and less complex than Intercom.
There’s a small portion of the 30 minute interview that I want to share with you, compliments of Rob Walling. Let me play it, and then I’m going to share three lessons learned that every entrepreneur should make note of.
Rob Walling: Congratulations on Userlist.com. You know, I still in the back of my mind, I think of you as Userlist.io because you were Userlist.io for two years. But I think just recently you guys landed, you dropped a couple thousand bucks on the .com?
Jane Portman: Quite a few. Yeah. And we’re absolutely excited about this. And we had doubts until the very last moment. But when we did buy it, and when we got out to the community with the news, that it was an instant hit, were like, “yes, this is so great!”
Rob Walling: That’s what I was going to ask was like, as bootstrappers you know, it’s I think Benedict said you spent $2,000 or $3,000 on the domain name – he mentioned it on his podcast. And obviously that’s an investment, you know, when you said you had doubts right up until the end, where you’re just questioning whether or not it be worth it and whether or not you should do it.
Jane Portman: We actually spent $4,000. And it’s definitely a lot for bootstrapper budget. We have been on the negotiation curve for like year and a half ever since, basically ever since our business started, and it felt (like) the right moment that it was valuable enough for us. And we understood that user list really has good traction now. And it was also good enough point for them not to understand that we are super, super successful because otherwise it will be like would probably go back up. We started negotiating at like $20,000, and then met at $4,000. So yeah, we’ve been having doubts, but we have never looked back ever since – that’s been such an emotional uplift for the whole company.
Rob Walling: Yeah, that’s good. That’s nice to have those hard decisions…that once you make them, you know you’re either going to feel terrible and be dragging them along and second guess them, or you’re going to feel amazing and move on and know that it was the right call and it’s so hard to know until you send that wire – you know – or until you do that 301 redirect and now your you know, your domain is is all up. So I’m super stoked to hear that the right call for you guys.
Jane Portman: Thank you.
First, as an insider in the domain name industry I wondered who owned it because it can affect asking price. In this case, it was owned by Uniregistry’s founder, Frank Schilling, under his Name Administration Inc. holding company:
I found this using domainIQ’s historical whois service in the most recent record before it changed ownership to Userlist.
While Name Administration typically prices their domain names high, they can be reasonable as well.
Dofo.com shows the original buy-it-now asking price at $27,300, and Jane Portman said their verbal asking price was $20,000.
Is it worth $20,000?
In DNAcademy, we teach people to evaluate a domain name based on characteristics, just like you would in physical real estate. How many bedrooms, bathrooms, square footage of the lot, and things like that. Virtual real estate, or domain names, have similar characteristics.
We have a methodology called the DNAcademy Valuation Worksheet, and I’m creating an automated version of it that’s in alpha right now. Let’s take a look at Userlist.com using the DNAcademy Valuation Worksheet tool.
Again – I want to make this clear – this is in alpha and not offered in the course.
I can see right here that userlist.com is the domain name. If I camel case it, it separates it as two words. It is a two word domain name three syllables in the .com. It’s a 16 year old domain name first registered in 2003. And its current registrar is Uniregistry, estimated valuations on this tool. Estibot puts it in about $12,000. GoDaddy puts in about $2,000. And we teach the Modified Rosener equation which applies to exact match domain names with exact match search volume and CPC. This domain name does not have those so we’re going to disregard that one. It is classified as a real estate domain name for some reason at by Estibot, which we get some data from the length is eight characters, no hyphens, no numbers, the Google trend per user list over the past, you know, decade has been pretty consistent. And here’s some more characteristics that I find very interesting when evaluating domain names and brandable domain names. The number of TLD is registered I will go to Dofo.com and I will look and you can see that there’s only five registered domain names for userlist.com. That means that people haven’t found “userlist” that worthwhile to registering other top level domain names. It’s often the characteristics that if it’s registered in say, 200 or 300 domain names like a generic word, such as pyramid, then it’s going to be much more valuable because there’s a larger pool of people that might want to buy it. Live trademarks from Trademark247.com, there are no trademarks either exact match or broad match. I can go to LinkedIn, I’m probably going to see the exact same thing but I do pull the number of companies worldwide that have the word in their name and there are zero [or close to it] so “userlist” is not a word that’s often used by companies to brand their companies and we and that’s corroborated by the number of TLDs that are registered. However, if we go to BrandBucket.com we can see there are about 1,100 domain names that have user list in their domain name. So it’s a popular brandable type of name, you can see busylist.com for $4,675. And you ultrauser.com for $3,895. And so this gives you an idea of what a brandable marketplaces going to price a two word brand level domain name like this for. And if we scroll down a little bit more I pull some more data from Estibot, the exact match type in per day is zero or close to it. There are only 480 searches… exact match searches for “user list” as two words in Google. It does say that there’s a cost per click, but then you really need to go over to Google and do a search for “user list” and see if there are advertisers. In this case, there aren’t — I don’t see any advertisers here. I’m going to go one more page into Google to see if there are any on page two… and there aren’t so you can’t really trust, you need to verify that search engine CPC. And then the number of pages in Google’s index is is high for user list because it’s a common term… “how do I get a user list of, you know, people that registered for my service or in WordPress” or what have you. So we can see that it’s a brandable domain name, because it is two words that aren’t in the dictionary — the two individual words are in the dictionary — but as a phrase, it’s not in the dictionary. It doesn’t have search volume or significant search volume. So that puts it as a brand double domain name.
In summary, I think Userlist.com is a great, two word, easily pronounceable and memorable, brandable .com domain name. Brandable domain names like this typically sell in a wide range for between $1,500 to $50,000, with the sweet spot of around $2,000 to $10,000 at brandable marketplaces like Brandbucket.com and Squadhelp.com.
So I think Userlist did great with their negotiation and acquisition price.
I look forward to learning more about Userlist, and seeing if they might be able to help my companies in the future.
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My name is Michael Cyger and I’m here to help you become a more successful domain name investor, broker or entrepreneur.
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