I I Tech Finance News
(Aug 14, 2000)
Trading Internet domain names in the current environment could be what trading junk bonds was like in the late 70s and early 80s, according to Pascal Pernet, assistant v.p. at London-based Credit Suisse Private Bankings special services group. Credit Suisse took part in a $10 million round for GoldNames, a Jerusalem-based company that is the first to trade Internet names in the same way an investment bank trades stocks or bonds. So far, GoldNames is the only company that has hit on the idea, Pernet said. Most Internet companies just want to set up a portal for something, he said. That isnt very creative compared to this.
Pernet said the value for a site is having a good name. GoldNames can provide the names for sale, collect service fees for trading names between companies, or offer the use of a name along with marketing while retaining ownership. Two decades ago, few people invested in junk bonds, and it was years before the market took off and they became commonplace, Pernet said. GoldNames may be in the same position, and could reap the rewards if the trading of Internet domain names grows the way junk bond trading did.
The only problem GoldNames might run into is the lack of names it has registered in English, but Pernet said this will become less of a problem as time goes on because more Internet users speak languages other than English as a native tongue. He added that the time horizon on the investment is longat least in terms of Internet time. It will be five years before we know if this is really going to work, Pernet said. Credit Suisse Private Equity was also attracted to GoldName because of its chief operating officer, Weldon Turner, who spent 14 years as a banker at Salomon Brothers and then Credit Suisse First Boston. Other members of the management team include Joe Schell, the global head of technology banking at Merrill Lynch. Israel-based venture capital firm Yazam invested $2.25 million in the round.
