Copyright SAN DIEGO UNION TRIBUNE PUBLISHING COMPANY Jun 7, 2000
Firm makes money selling Internet addresses at .ws
for Web Site
For chart, see end of text.
Alan Ezeir and Michael Starr are e-commerce entrepreneurs with a difference: They're making money, and they've done it without venture capital.
The two former UCLA college friends had already founded a passel of small but profitable North County Internet businesses when they stumbled upon what they believe will become their greatest success: a whole new set of Internet addresses for sale.
With many choice names bearing the ubiquitous dot-com suffix already claimed, Ezeir and Starr founded Global Domains International to register Internet addresses ending with .ws, which they've dubbed Web Site.
After three months of marketing the extension -- known technically as a top-level domain name -- the two say they've registered more than 36,000 addresses.
Global Domains says it's registering new names at the rate of 600 daily, with each paying a fee of $70 for two years.
A typical customer, they note, buys more than two domain names. Among the high-profile takers of .ws names have been Yahoo and Intel.
The business of Internet name registration -- formerly monopolized by Network Solutions -- may allow for a bevy of players. Register.com -- one of several companies in the business -- reports assigning 5 million names in the first quarter of this year. And register.com provides .ws as one of its featured address options.
Whether Global Domains can accelerate or maintain its current sales pace may depend on its ability to generate some pizazz around .ws, say Ezeir and Starr.
"It's all about putting together something that people will remember," said Ezeir, who serves as president.
"People don't know what dot-com means, so we said how about .ws as Web Site," said Starr, the company's chief executive officer.
The company has put ads in national publications, including Fortune magazine, promoting .ws as the alternative to .com and "the buzz of the Internet."
Ezeir and Starr note that they are marketing .ws under authority from Samoa, which was assigned the top-level domain name by the international body.
The growth of Web Site has already propelled a move by Global Domains from crowded offices in Escondido to a new 20,000-square- foot space in Carlsbad early this month.
The new business appears poised to outdo the success of earlier joint ventures for Ezeir and Starr, who recently celebrated their success by buying themselves Ferraris.
Native Californians Ezeir, 32, and Starr, 31, went their separate ways after UCLA. Ezeir says he did well by loading up on a stock he bought as director of sales and the third hire at San Francisco- based USV Telemanagement, which eventually went public.
Starr worked in sales for a variety of technology companies.
In 1996, the pair hooked up to launch Planet Earth Communications to sell long-distance phone service via the Internet.
Tapping technology to the utmost, Starr and Ezeir built a business that required as little human contact with customers as possible -- allowing Planet Earth to offer variable rates frequently below those offered by the major carriers.
Last year, the long-distance company generated $3.1 million in revenues, up 50 percent from the previous year. But Planet Earth's marketing partners asked for more.
"We had a lot of savvy Internet partners who (asked), `What else do you have to sell?' " said Michael Papale, executive vice president who joined the company in 1998.
Soon they founded Traffic Boost, a service that places customers on the radar screens of hundreds of Internet search engines. The service has more than 45,000 customers, according to Papale.
But Starr and Ezeir remained on the prowl for something else.
"We wanted to find a high-margin business," said Starr.
One of their ventures involved new domain names, and the partners found themselves involved in registering new dot-coms.
"We were making Network Solutions rich and that was driving us crazy," said Ezeir.
The entrepreneurs plunged into a review of assigned extensions, looking for marketing possibilities. To be sure, they were not the first.
The .md extension assigned to the nation of Moldova is being marketed to physicians. The Pacific nation of Tuvalu is auctioning its .tv domain name to television stations.
And .ws was assigned to Samoa, for its former designation as Western Samoa, but the name was not being marketed. Ezeir and Starr quickly envisioned the Web Site marketing campaign and flew off to the island nation to make their pitch.
After a frustrating moment when an aircraft mechanical problem threatened their arrival at a much-anticipated meeting with the king and prime minister, the entrepreneurs landed in Samoa and commenced the deal, which gives the government a percentage of sales derived from .ws registrations.
Global Domains now holds the license to market .ws.
"The prime minister understood money and the global market," said Starr. "We said we can take this global and here's our idea for .ws."
The two manage their businesses with a heavy emphasis on generating earnings along the way and remaining closely held.
"We said that if we can hold out without outside investors, let's hold out," said Ezeir. "When you bring in investors, you end up with partners you don't like."
They recognize that the lack of capital prevents them from a full- blown national advertising campaign, but are determined to stick with what they call an "old-economy philosophy."
They take pride in careful hiring, very low turnover and providing employees with stock options.
QUICK AUDIT Company: Global Domains International Business: Sale of Internet addresses Founders: Alan Ezeir and Michael Starr Headquarters: Carlsbad Employees: 29 Revenues: $4 million in 1999; $20 million projected in 2000
Credit: STAFF WRITER
|Sub Title:||[1 2 7 Edition]|
|Column Name:||THE ENTREPRENEURS|
|Personal Names:||Ezeir, Alan
|Companies:||University of California-Los AngelesDuns:00-398-5512Sic:611310
Global Domains International