A set of three documents filed in California Bankruptcy Court earlier this week reveal that the world’s most valuable domain name – Sex.com – has been sold for $13m, just one million dollars more than it was sold for back in January 2006.
The tale of Sex.com is a fascinating and complex one (I wrote a book about it), and never short of twists and turns. The most recent twist came earlier this year when the company that bought Sex.com from Gary Kremen in 2006 (for $12m plus $2m in stock and other options), Escom LLC, declared bankruptcy. Escom has been unable to make Sex.com sufficiently profitable and was overdue on interest and debt repayments.
This announcement was quickly followed by the news that Sex.com would be put up for public auction – the time, date and location and the need to be holding a cheque for $1 million to even be allowed in the room, were published. But then, one of the owners of Escom, Michael Mann, broke cover (Escom has always been purposefully cloaked in corporate law cloth) in order to prevent the auction going ahead.
After some more fighting, it was agreed in July that the Sex.com would be sold in a closed auction run by domain brokers Sedo.
That auction ended at the end of September but no news emerged, although Sedo did tell me that something had been agreed but they weren’t in a position to discuss it. Finally, a set of three documents provided to the Central District Court of California on Monday, put into the record on Tuesday and first noticed by Kevin Murphy/DomainIncite today outlined the sale of Sex.com by Escom to another strange corporation, Clover Holdings Ltd, based in Caribbean offshore tax haven St Vincent and Grenadines.
Anyway, possibly the most interesting thing, apart from the peculiar behaviour of all parties yet again, is that the domain has gone up in price by only $1m in nearly five years.
- Does this mean that Gary Kremen got a great price back in 2006?
- Does it mean that the value of dot-coms, even Sex.com, is stabilising?
- Or does it mean that the buyers kept Escom down to the original price because they knew Escom had no real choice?
I’m not sure. I’ll give it some thought. My feeling is a bit of all of them, but mainly the last one.