I bid $900,000 and prayed that no-one would put in a higher offer. The minutes ticked by and I heard nothing. The only thing I could feel was my pulse..
At the age of 28, Erik Bergman made US$15 million by listing his company on the stock exchange. This gave him a feeling of euphoria that lasted for two weeks, but ultimately left him wanting to do something else, something different. Then along came a charity project in Ghana that would come to be known as Great.com – via a domain name with a price tag of $900,000. Marcus Glaad managed to get an interview with Erik, to let him tell us more about his initiative and why he chose the pricey domain name Great.com.
What’s behind the price of Great.com, in your opinion?
It is always difficult to value domain names, and I may very well have made a mistake in my thinking here.
My reasoning, anyway, was that our ambition is to build something really big, something that will generate many millions in profit over the next 50 years. With that kind of time-scale and objective, the name is going to play a very big role.
Really, I set myself a simple question:
Do you think that the name will generate more than $900,000?
$900,000 spread over 50 years is $18,000 a year. I felt sure that a trademark as strong as that would be worth more than $18,000 a year, and that made the decision easy.
I’ve thought about it a lot and I could tell you a lot more about my reasons, but I think that sums it up as clearly as possible.
Were you just on the hunt for Great.com or was there other alternatives?
Great.com was my absolute favorite but there were plenty of alternatives along the way. Best.com and Play.com had been other candidates, but I never made any offers for them.
What significance do domain names have today?
Domain names can play both very large and very small roles. When you start your first company, I think the name plays quite a small part. It’s how you handle customers and how you connect with people that makes the big difference. There’s no reason to spend a lot of money on an expensive name at that stage. If your ambition is to become international, though, with high visibility, it becomes a whole other thing. It can work with whatever name you want, but a good name can make a big difference.
Can ‘normal’ companies learn something from the affiliate industry and its ways of working with domains and content?
Yes, I think there are definitely things to learn. The affiliate industry is often completely built around SEO. Just checking how their sites are structured and how their links and content works, gives a very good snapshot of effective strategies. You can apply the same kinds of thinking selling car tires, for example, that people use in the casino industry, so you can get a lot out of it.
Tell us about the acquisition of Great.com. I was in Las Vegas during the auction, and it went on to become one of the year’s biggest stories in the domain world. Did you have an upper limit of some sort? How was your heart-rate during the bidding?
My heart-rate was extremely fast! I was sitting behind a computer screen in Iceland while everything happened in Vegas.
I didn’t think there was going to be a sale. For a long time I sat there, in the middle of the night, just waiting for the auction to finish. For a while the highest bid was $100,000 from me, but I had already made an offer of $500,000 before the auction. That wasn’t accepted, so I knew that $100,000 wouldn’t be nearly enough to force a sale.
Time was beginning to run out and my low bid $100,000 was still there, so I assumed the seller would just decline the sale. Then a bid of $500,000 came from someone. I bid 600 and then immediately 700 and then 800 came in. My heart-rate was up at about 200 at this point and I just stared at the screen. A big button with “Bid $900, 000” was staring back at me. Less than 10 seconds previously I was sure that there wouldn’t even be a sale.
I bid $900,000 and prayed that no-one would put in a higher offer. The minutes ticked by and I heard nothing. The only thing I could feel was my pulse…
Then the auction closed and the domain was mine. I didn’t know if I should laugh or cry. I hadn’t even had time to think about what I had done.
I don’t really know if I had an upper limit. I was set on buying the domain and, in the heat of the moment, just about anything could have happened.
Tell us more about the Great.com project
Great is going to be a normal company, in that the ambition is to earn as much money as possible. The big difference will be that all the money will go leave us. For me, the most important thing is to have a goal to strive for for the rest of my life, and this is exactly what Great is going to be.
We’ll also distinguish ourselves from most companies in other ways. Part of it is that we’ve set ourselves a 50-year plan. Another part is that we want to build everything at a distance. We also want to be fully transparent so that everyone knows everything about us. A lot of this is just ideas at moment, but I feel really confident that we will work these things out along the way.
When can we expect to see more of the project and what can people do to contribute?
Something will be rolled out or else there will be some news announcements in the next few months. We are six people just now but we’re going to become considerably larger. It will take quite a long time until we have a commercial product on the market, though. How long remains to be seen but I’d say at least a year. If you want to dig a little deeper and speculate about our future, you can have a look at erikbergman.se, my private site where there are some clues about what we’re going to do. You can try and put the pieces together there.