The Yun Ye / Marchex Paradox

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Jeff

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In 2005, Yun Ye sold his portfolio of 100,000 names to Marchex for $154 Million.

Today, Marchex's market capitalization is less than $107 Million:
MCHX: Summary for Marchex, Inc. - Yahoo! Finance

Marchex is losing money; Yun Ye was making $19 Million per year in parking revenue.

Funny thing is - if Yun Ye put his money in the bank, he could buy Marchex up and still have tens of millions of dollars left over!

It goes to show - development really only pays if you know what you're doing. And you still need to stay really lean when you're developing. Even with parking revenue down, it's not such a bad business model.
 
Yun Ye is the epitome of the all knowing domainer cashing out when the timing was perfect and Marchex are the perfect example of the greed syndrome thinking they could improve on what the ultimate expert was doing.

All power to the Yun Ye elbow!
 
2005 wasn't the height of the domain market, but in retrospect, it looks like a smart decision to sell. Sometimes it's best to accept a good deal rather than hope for the "best" deal.

Marchex.... man, I feel like I could run their company better than they do...
 
2005 wasn't the height of the domain market, but in retrospect, it looks like a smart decision to sell. Sometimes it's best to accept a good deal rather than hope for the "best" deal.

Marchex.... man, I feel like I could run their company better than they do...

If you can sell on the up slope not on the down, very difficult to determine a peak in any business, too many external factors.
 
It also depends on how much effort the company makes to keep up with the latest trends, on the internet , things are constantly changing. You cannot afford to be complacent.
 
That's a big part of the difference. My understanding is that Yun Ye and his wife did pretty much everything when they were running things.

Marchex has a big corporate structure that I think eats up a large amount of the revenue.

The Marchex executives are doing well - not the shareholders...
 
Yes, in a big company, time is wasted in office politics and non productive meetings. Overheads are also much higher.
 

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