Ricklatonas interview from domainblog.com
“Rick Latona, young serial entrepreneur, is helping take domaining to the next level. One of his latest companies, DigiPawn, is actually the first licensed pawnshop that pawns digital assets such as domain names and intellectual property. This is a big step towards banks and lending organizations recognizing domain names as actual assets that one could borrow against. While it still might take years for these types of institutions to recognize domain names as a stable form of equity. If and when this time comes it will completely revolutionize the domaining industry as we know it. In the meantime, for those in need, feel fortune that Rick is able to offer this very unique service that actually grants you the opportunity to borrow money on your digital assets. Not only that but Rick is one serious domainer himself, who currently holds over 11,000 domains, and knows a couple things about the domaining industry to say the least.
Here is what Rick Latona of DigiPawn & iWebmasters had to say:
Q: db – What is your name, how old are you, where are you from and how did you come to be involved in domaining?
A: RL – My parents call me Ricky but everyone else calls me Rick Latona. From time to time I’m called “Rick with a silent p.” You figure that out.
. I’m 32 (as long as you publish this quickly; it’s October [whois DigiPawn.com for birthday gift address]), originally from New York and I’ve lived in both Europe and Asia. Like most early domainers, I was involved with toll-free or toll-numbers, pre-web. My father had a system similar to 800-CAR-LOAN where you could apply for a car with your touch-tone-phone, 24-hours a day, 7-days a week, regardless of your past credit history.. *pant *cough *wheeze. We instantly recognized the vanity value of domains, the 800 number guys I mean. I only wish I believed in my foresight more. I didn’t follow what I knew was right because I listened to others. I regret that, but I don’t dwell on it because who hasn’t had failures in life due to not listening to others?
Q: db – You recently came up with the idea to create a digital pawn shop. In fact, it’s the first of its kind, correct? How did you come up with such an original idea and what lead you to believe that there’s a market for this service?
A: RL – I’m going to answer this from back to front. I’m trying to create a market for this service. The problem with being the first mover is that no one understands exactly what you’re doing. We have the unfortunate/fortunate position of having much more money than we have customers.
As for the idea, I came up with it years ago but never acted on it. It wasn’t until my good friend, a lawyer, with cash, wanted to partner with me on a business sprung from the idea that I decided it was time to act. I tend to not act on ideas unless they survive my own mental due-diligence for a long period of time, so that was the delay. I usually come up with ideas daily and spend the first week or two picking them apart. Then, if it’s still a good idea after a year, I seriously consider it. What should be interesting for you readers is that we started DigiPawn to acquire domains cheap, but no one defaults! It has really just turned into a bank account for us with high-interest returns. Not that we’re complaining. It was just not what we set out to do.
As for the concept, to the best of my knowledge I invented the idea of pawning intellectual property. I have seen one other company try IP loans but they weren’t doing legal state licensed “pawns.” It’s possible that someone else came up with the idea, they may have even tried it, but they didn’t have my two competitive advantages: 1) I used to own a pawn shop and understand how the finance (read: money management) aspects work; and 2) we’re also pretty wealthy. And that’s good because pawning intellectual property is as cash intensive a business as I’ve ever seen (I’ve seen a lot for those that were wondering).
Q: db – What is it that people can pawn exactly?
A: RL – Excellent question. Most transactions are domains, but we except all forms of intellectual property that have liquid value and don’t consume a ton of time on due-diligence. In other words, we will loan anyone, slightly less than or equal to the wholesale value on their digital asset. Nearly all transactions are domains, but the bigger we get the more active website, content libraries, and in one case, patent rights deals we are doing. What makes non-domain IP loans complicated in most cases is the due-diligence, or in layman’s terms, the work we have to put into making sure it is a solid deal worth backing.
Q: db - What exactly does somebody have to do to qualify for a cash advance? Are there any specifications one must be aware of?
A: RL – That’s another excellent question. “They” don’t have to do anything. We don’t care who it is or where they are. Values are based on liquidation ability and nothing more. It is very simple really. We decide that we could get X if they default and therefore will not loan more than Y. We take physical (we become the registrant but the client keeps the DNS record so the site is unaffected) possession of the property during the pawn so as long as we are under wholesale they can be a fugitive Romanian in Tajikistan running from the Hungarian police for stealing Outer Mongolian Hun artifacts; although we’d prefer that there isn’t that much drama. Seriously, the only criteria are that they own and have the rights to pawn the asset.
Q: db – How do you go about evaluating one’s digital property? Do you except appraisals from other reputable companies such as Sedo for example?
A: RL – Yes and No. We don’t except appraisals from Sedo at this time, but we recently partnered with Moniker, and we’ll soon be able to post “pawn values” on all of their appraisals. I’d like nothing more than to report that we’ve cut the same deal with Sedo because that would make them money (Sedo are you listening?). Our methods are 60% scientific and 40% from the hip. It’s 100% proprietary.
Q: db – What percentage of the digital assets can one expect to be advanced?
A: RL – They can expect 100% or less of what we deem liquid value, which is probably much less than what your average readers think their domains are worth. That’s the tough part of our business. I agree that my domain aeiou.com could sell one day for 1 million, and I should have it priced at 100,000, but you have to realize that I couldn’t wholesale it for more than 10,000. That’s what we have to think about. We need to be able to get the cash back if you, as a customer, default so we can give the money to someone else. That’s just the way business is done and pawnshops are run.
Q: db – Do you have any plans of offering actual loans on digital assets?
A: RL – No, we’ll pawn only. We have millions, but standard loans would require an extra zero or two, or worst case, three. None of us are here for prime plus one so it isn’t fair to ask us to fill that gap. Companies like banks and insurance organizations that loan money at those rates are loaning other people’s money so that +1 over prime is their cash flow. We use our own cash and I’d buy a bank or insurance company before doing standard collateral loans. So everyone knows, if that day comes, credit will mater. The industry will need to be advanced enough for prices of domains to have stabilized. Banks look at personal credit as a hedge against market fluctuations. You can’t borrow money traditionally, against a domain, unless you could borrow money on your signature alone. The domains will only slightly increase your loan amount. My guess is that we are 15 years from everyone having the ability to take regular loans. It is not that it will take that long for domains to reach high-values; it’s that banks will want to see the market stabilize and stay that way. DigiPawn’s goal is to brand a service that people know is the last stop instant cash guarantee when in a dire situation. We are a pawn shop, not a bank. We’re here to save the day, not finance growth.
Q: db – It’s understood that you also buy digital assets. What kind of percentages of the appraised value can one expect to get from selling their digital assets to you?
A: RL - I do buy and I buy often. I don’t really pay retail unless I need the product (like my 27,000 dollar purchase of contactcenter.com from Moniker last week because I’m actually in that business—I was the end-user and I believe in good domains). My clients get the best deals on portfolios. Portfolios are my favorite things to buy. I step up and pay more when there are many domains that could save the deal if I made a mistake. Single domain purchases for a high-price make me nervous. I wouldn’t buy a high-end single residence for resale either. A duplex or quadplex would be a good start. Give me an apartment complex, 1000 acres, or a shopping center and you have my attention. That’s my approach to domains, but I’m also lucky to be able to buyout portfolios, which many people can’t because of their financing options.
Q: db – Not only do you buy digital assets outright, but you also broker them, correct? How does this process work exactly and do you take on any digital asset for sale or is there a minimum requirement one is expected to meet?
A: RL – We charge the standard 10% on consignment sales. It isn’t a big part of our business because you need a parking system to attract retail buyers on type-in but brokers do frequently browse our site. In the near future we will be proactively marketing the best names. I have unlimited access to cheap labor. I had one Filipino spend 5 months trying to sell Dollars.com to currency trading and Forex institutions for an astounding 5 million dollars. He failed, but he covered his salary in the extra clicks I received from him calling everyone. We will need to refine our approach before rolling that service out.
Q: db – Let’s say somebody wants to purchase a digital asset from you. What forms of payment do you accept and how long does the typical transaction take to complete?
A: RL - If someone wants to send me money, the world is their option. They can FedEx a 60 kilo/25 pound bag of coins if need be. We are capable of processing any currency in any method. Please don’t forget that I come from the hosting/processing industry. Except for my sites in www.SickSiteNetwork.com, all my properties are infrastructure companies that cater to webmasters and medium sized Internet enterprises. I have an offshore staff leasing company called www.iWebmasters.com, where I rent cheap labor to companies that actually want to pocket profits, a semi-parking company with www.warningpages.com, an advertising firm with www.cjtraffic.com, a cash advance company with www.DigiPawn.com and lastly, a software company that has applied for 5 patents on object delivery intelligence (I’d explain it in detail if I understood my own concepts, but I confuse myself at times and won’t subject you to that torment).
Q: db – Do you worry about fraud? Have you had a customer run a scam of any type?
A: RL - This is one of your best questions. We become the registrant during the term of the pawn. It’s Georgia law. Technically a pawn is defined as a purchase and the buyer has a right to buy it back for 1XX% (one hundred and change percent) of the price in a pre-agreed upon time. What makes it work is that we don’t change DNS settings so the clients’ site remains unaffected during the term of the pawn. Think of it like an automobile title-loan where the pawnee keeps driving the car but leaves the ownership with the pawn broker. All of this means that fraud is unlikely but still possible. It comes with the territory and we manage that risk. As an ex-real-world pawnbroker, my bullshit detector works exceptionally well.
Q: db – Now we know that you own and operate the world’s first digital pawn shop but are you a domainer yourself? If so, how many domains do you currently hold, what are your most prized and how do you monetize them?
A: RL - I own 11,000+ names if you count all my entities. Personally, I own probably 7000+ alone with no partners. I am currently parking undeveloped Overture one-click names at HitFarm and names that can’t be one-clicked on Overture at Fabulous’ 4.0 system. That said, we develop often and relentlessly. Due to my infrastructure, we can acquire a name like xxxanime.com and have a free site live within a week with relatively no overhead. Next week we’ll launch www.PDAGames.com and on and on and on. We have hundreds of active sites. I can’t really get into my most prized domains because my most profitable domains are leased. In 2004 I was very aggressive in securing long-term leases on great revenue generating names for less than they were making per month and got most leases for greater than 5 years. I currently am leasing 2000+ names. I also “pride” myself on the more creative deals. For instance, I bought adolfhitler.com purely to donate the domain to the Anti-Defamation League two years from now for enough money to have real and significant gains via a tax-break. My prize possessions are the deals where I got away with something and created a value-proposition for everyone when others tried and failed. I bought Dollars.com off a guy in an airplane because instead of being annoyed by others, I asked the guy next to me in business-class what he did for a living. Those are prizes.
Q: db – Do you have anything planned for the future that the domaining community should be on the lookout for?
A: RL – Those who know me know that I’m always planning to launch something. I’m a serial entrepreneur. It’s an addiction and I admit it, so I’ve passed the first step.
Q: db – Do you have anybody that you would like to thank for helping you get to where you are today?
A: RL – I’d like to publicly thank Rick Shwartz for indirectly (no direct talks) reminding me who I once was. You see, I was the guy that gave speeches in 1997 about the Internet spreading democracy and capitalism everywhere so that wars would end because countries that owed each other money didn’t launch missiles. I was the ultimate evangelist and believed in domains as much as he did. I was the dotcommer guy people watched on CNBC in disbelief! I lost my way… When the bubble burst I lost 100,000+ a day for 6 months straight while I was in a stock lock-up and couldn’t sell my shares. It was not motivating. I lost my gusto, gumption, pizzazz, and *try to insert another buzzword. Between 2001 and 2003 I just did the best I could in business by running good companies, expanding great brands and being a leader that got my team to produce. In 2004, I sold Spanish.com for 250,000 dollars and afterward looked to see what HitFarm (Kevin Ham) did with it. Then I joined Rick’s targetedtrafficforum.com message board. It was at that point that I started to realize that the industry was ready for a guy like me. Screw not being there in 1994. I was there but didn’t make the bucks I make now. After I sold Spanish.com I dove headfirst into domaining and I’ve been more productive in 2004-2005 than I was previously. Most domainers are timid and I’m a deal maker. I buy and sell large portfolios and loan money on single or portfolio values. I created a niche for myself when I started paying attention and I think it was Rick who woke me from my slumber.
Slavik Viner is my personal domain hero. He’s a great guy and I feel as though I can truly trust him. He’s been a mentor for me when I’m so used to having protégés in other ventures. It’s nice to change sides from time to time.
Matt Collins, my partner in DigiPawn, is one of my best friends and he’s a brilliant lawyer to help deal with the pawning of intellectual property intricacies that I’m sure you can all imagine.
Paul Dinin and Marc Womack, my partners in the www.sicksitenetwork.com are simply great consumer entertainers. I could never do what they do and I’m damn glad to have them on my side.
Deepak Agarwal, my partner in www.iWebmasters.com is brilliant.”"
Kategorie: Uncategorized, Geschrieben am April 30, 2009 von admin