How To Waste $500,000 On A Domain Name - Startups.Com Story
Daily deal community for website owners Startups.com is shutting down. In an email sent out to its mailing list subscribers, founder Gonzo Arzuaga admits that the company just “couldn’t make a go of it.”
“We didn’t achieve the ambitious goals we set for ourselves when we launched only 1 year ago. So, with regret, this news of our departure from the realm of Daily Deals,” writes Arzuaga. “This may be a shocker to some of you and we want you to know that we’re really sorry we failed to achieve your expectations.”
In October 2008, KillerStartups purchased the domain name Startups.com for some $500,000 in cash. A year later, the domain was relaunched as a Q&A site for business questions. Then, in April 2011, Startups.com shifted its focus to the business model it operates today: daily deals.
he Q&A section was moved to answers.startups.com (now disabled), but the homepage began featuring discounts on things website owners, online businesses, and startup entrepreneurs would appreciate, like discounted software, gadgets, e-books, services, and other types of resources they may need to grow their company. Those same type of deals are still live on the site now, as the company hasn’t quite pulled the plug just yet.
According to Arzuaga’s email, Startups.com is not the only property that’s being terminated. BlinkList, a service that lets you save local copies of websites (which no longer seems that relevant, we admit), is also shutting down.
We reached out to Arzuaga for more info on the situation, and, as expected, he’s not too happy about how things worked out.
“Actually, I never expected to be in the spot of going on the record about shutting down a venture. I guess this is the other side of the coin in any entrepreneurial venture,” he says. “I’m really happily surprised by the 100 emails I’ve received with words of support and encouragement from our subscribers (we sent them yesterday an email notifying them of our termination). I am truly amazed, and thankful,” he adds.
But those feelings are tempered with a touch of grief, too. “I begin to feel very frustrated, when it comes to looking back and thinking about Startups.com,” Arzuaga says. “Today is a really blue day.”
He also tells us that he put $250,000 into the service and believes the domain name Startups.com is “an awesome asset” to have. But bad news, folks: the domain name, for now, is not up for grabs…well, not exactly. Arzuage says he doesn’t want to sell the domain, even though he has already had offers in the high six figures should he change his mind.
“We’re looking for an amazing partner to take it to the next level and make it shine,” says Arzuaga of how he wants to now move forward. But given how recent a change this is, he admits he hasn’t had time to really think about things in depth.
As to why he couldn’t make a go of the business, it could have something to do with the “daily deal” model simply not appealing enough to those who would feature their software or services on the site. One company tells us that after the huge discount offered and Startups.com’s 50% commission, their listing, while generating a decent number of orders, was essentially a loss leader for them.
[Via - TC]
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