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Comment by d4ft | Hacker News Reader

Wow, is .25MM cheap for a domain name.. ever? I can't think of a scenario in which it would be. Could anyone enlighten me as to the economics of this?

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I think he meant that it's cheap in comparison to what they built.

They built a business with huge revenues. When I asked him if he could at least say that Groupon generates over $100 million, I think he laughed and said that $100 million is small.

Hmm. I did some math here-> http://news.ycombinator.com/item?id=1338758 a while ago. I figured 175M revenue. If 100M is small, I must have been way off.

It's cheap when your business is valued at $1 billion.

Yeh, but it wasn't valued at that when they bought it.

Which the article directly addresses:

"I think we bought it in May 2009 or something like that for maybe $250,000, which seemed like a lot at the time and now it seems cheap."

I mean I get that Groupon is a huge business. I guess the question is are domain name prices relative? If, for instance, this was a public company, and this was disclosed, I would be a pissed off shareholder. Is it better than taking the corporate jet on a family vacation? Yes. Does that make it a good business investment? Don't know. Obviously Groupon is not a public company, but it seems like you could get a much higher ROI on a quarter of million dollars invested in the primary product as opposed to domain name. Maybe not, just my 2 cents.

For trendy consumer startups like Twitter and Groupon, I can imagine that the name does affect word-of-mouth. But in general, I think most products could be called anything and succeed. Meebo is an idiotic name but they have millions of users because their product is solid.

I upvoted you but I disagree completely.

Names are of vital importance.

Meebo may sound idiotic to you but it's rhythm and sound fit the web-2.0 ethos, it's short, easy to spell, easy to share, lends itself to verb-ising, including "me" suggests personal communication and "-bo" links with other site name (I've never heard of it, but I'm guessing it's a myspace/bebo mix based on the name) ...

I think most opinions of names are post-hoc rationalizations. I think that if Meebo was a failure we would all think it was a stupid name.

When Snickers started in Britain everyone expressed the idea that it sounded stupid and Mars Co used this as part of the advertising angle ("[corny French accent]'av' you got the snickers?"). Was/Is it a better name than Marathon? Don't know.

Also are you really claiming that you're the only person able to avoid post hoc analysis? Or indeed that you're immune to it. Perhaps you only think it sounds stupid because you think the product is stupid or because of the style they use to market it.

I was surprised by this. Sure, 250k is tiny compared to the current value of Groupon, but they were also in a superior bargaining position and had crafted a situation where the domain was practically worthless to the original owner. I would have thought they could have talked him down to <100k

Well, for sex.com or x.com it is :)

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