Saturday, August 23, 2014

Adding Rightside Group to the beating Buffet portfolio

Rightside Group (NAME) is in the domain registry business. Domains are the identifiers for websites on the internet like xyzcorp.com, irs.gov. ncstate.edu, etc....Because the internet keeps growing the amount of domain names has not kept up with growth in websites and traffic. Therefore ICANN, the international non-profit that manages this system has issued a whole new slew of internet domains. Rightside is currently the number two domain registrar. So basically anytime a person or company creates a new domain and it is one that Rightside controls it will get a fee. Rightside is essentially an internet toll road operator as it pertains to domain names. This is a business with very high margins in a business, the internet, that has infinite growth opportunities. I like the business because it is basically a virtual picks and shovels business and not a content business. I could care less what is put on these websites and if anyone looks at them as long as the domain fees are paid every year Rightside gets paid.


The issuance of all of these new domains was described by Googles CIO as, "the most important and exciting change in the internet in a long, long time. Maybe since the beginning of the modern internet.” The person that writes the blog Buysidenotes.com has a full write up on the business and its prospects going forward. This selection is an example of how I leverage someone elses thinking and research for my own portfolio. I am adding Rightside Group (NAME) to the Beating Buffet portfolio and my own personal portfolio.


You can track the growth of domain registrations at this website. You will notice that since the beginning of 2014 when ICANN issued the registries the number has been growing quickly and is now close to 2 million registrations.

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