DNS Business Development Workshop Course Overview This course is designed to provide a basic understanding of the Domain Name System (DNS) industry and business drivers to enable entrepreneurs to understand potential business opportunities in this industry. The course will focus on practical issues where appropriate, with case studies and listings of available resources and vendors in the industry. Ample time will be included for networking opportunities and identifying available resources for on-going assistance after the conclusion of the course. The course will occur over a 5 day period, with an early end on the last day to accommodate travel schedules

1. Day 1

2. Generic, short gTLD
Most Likely Case Scenario
Wholesale Price $30
This is an actual TLD financial plan that has been altered to protect the
privacy of the owner(s)

3. Registration Volume
Who is your target market?
Are there synergies with other TLDs
and markets?
How are you going to reach them?
How many existing domains exist with
the term in them? What percentage
will purchase a new name with the
same term in them?
Considerations:
• Price Point
• Availability of alternatives
• Penetration rate by year
• Renewal rates
Generic Short TLD
Projected Cash Flows Year 1 Year 2 Year 3
Most Likely
Part A: Generic Market A 1,764 1,848 1,296
Part B: Recreation 8,271 9,648 8,100
Part C: Sports 1,161 1,223 856
Part D: Educational 432 476 349
Part E: Specialty Deals 3,744 4,725 4,410
Part F: Existing Domains 711 713 357
Registration Volume in Years
Opening Balance - 23,932 60,947
New Additions 23,932 37,015 43,518
Total Registration Volume in Years 23,932 60,947 104,464
Sunrise 300 - -
Landrush 700 - -
# Purchases 17,208 29,977 35,307
Premium Domains: 1,125 1,456 1,488
23,932 37,015 43,518
Total sales are 16,084 yet new
additions are 23,932 – Why?

4. Cash Inflows
As registrations may be for more than a
year, the number of domains years can
be higher than the number of purchases
i.e. EGYPT.HOTEL is registered for 5 years
Premium names sell at a higher than
normal prices and may have higher than
normal renewal prices i.e. invisible.ink
Sunrise registrations are registrations
from trademark holders which often
includes an application fee
Registry Fee is an expense for the
backend platform to manager the
domains. The fee varies based on
numerous service & volume factors
Generic Short TLD
Projected Cash Flows Year 1 Year 2 Year 3
Most Likely
Domains Under Management 18,268 48,245 83,552
Registration Volume in Domain Years 23,932 60,947 104,464
Cash Inflows
Registrations 589,832 1,061,472 1,317,371
Premium Name Auctions (New & Renewals) 431,250 191,563 61,891
Sunrise Registrations 118,000$ -$ -$
Landrush Registrations 1,464$ -$ -$
Other Cash Inflows - interest 31,450 48,836 68,061
Best ONLY Revenue streams - - -
Total - Cash Inflows 1,171,996$ 1,301,870$ 1,447,323$
Total Cash Outflows:
Cost of Sales (cash)
Registry Fee - Per Domain 77,779 120,299 140,316
ICANN Fees - Quarterly Fixed 185,000 25,000 25,000 25,000
ICANN Fees - trx fee - Var - - -
Premium Name Fees 47,438 15,813 -
Total 150,217$ 161,112$ 165,316$
Gross Margin (cash Sales Basis) 1,021,780$ 1,140,759$ 1,282,007$

5. Cash Outflows – COS & Labor
Labour varies depending on existing
company resources, focus, mission, sales
efforts, backend provider services
Marketing costs vary depending on how
the registry plans on reaching its end
users. This TLD plans on attending trade
shows, banners on niche websites
Legal fees are nominal due to the open
registry policies requiring minimal
policing
This TLD is expecting to be profitable in
every year
Generic Short TLD
Projected Cash Flows Year 1 Year 2 Year 3
Labor: Cost of Living Adj?
Marketing Yes 80,000 72,000 73,800 75,645
Customer Service Yes 50,000 45,000 50,000 51,250
Admin Yes 50,000 45,000 50,000 51,250
Total Labour 162,000 173,800 178,145
Marketing Costs - Var No 500,000 300,000 300,000 200,000
General & Admin Yes 50,000 45,000 45,000 115,000
Professional Fees - Legal Yes 24,000 24,000 18,000 16,605
Other: COI Costs No 1,000 1,000 1,000 1,000
Other: Escrow: Fixed Yes One-Time 2,000 - -
Other: Escrow Variable Yes 0% 5,000 11,400 19,000-
Total Operating Cash Outflows 539,000 549,200 529,750
Taxes - - -
Total Operating Cash Outflows 689,217$ 710,312$ 695,066$
Projected Net Operating Cash Flow (cash basis) 482,780$ 591,559$ 752,257$
Cumulative 1,074,338$ 1,826,595$

6. Generic, short word gTLD
Worst Case Scenario
Wholesale Price $25
(Note: Wholesale price change $30 in the most likely case based on the
assumption that consumers are price sensitive)

7. Registration Volume Generic Short TLD
Projected Cash Flows Year 1 Year 2 Year 3
Worst
Part A: Amusement 1,323 1,236 648
Part B: Recreation 5,508 9,648 12,156
Part C: Sporting 873 1,427 1,712
Part D: Educational 270 556 786
Part E: Specialty Deal 2,250 4,200 5,513
Part F: Existing Domains 711 713 357
Registration Volume in Years
Opening Balance - 17,291 49,536
New Additions 17,291 32,245 47,835
Total Registration Volume in Years 17,291 49,536 97,370
Sunrise 1,000 - -
Landrush 60 - -
# Purchases 12,060 26,280 38,653
Premium Domains: 1,125 1,456 1,488
Total 17,291 32,245 47,835
Similar to the most likely scenario with
a decrease in volume ~11k resulting in
17k in domain name registrations
(prior was 16k and 24k in
registrations)
Notice in year 2 the New Additions is
32k yet there are only 17k new sales.
Is this an error?

8. How TLDs Vary from Other Businesses –
Cash Cow Effect
• Payment is upfront for a registration (no risk of payment)
• For accountants, revenue recognition is a portion of the
registration fee each month i.e. a $12 registration fee is $1 in
recognized revenue per month
• Hence, most new TLD Owners evaluate the business based on
cash flows
• Reoccurring revenues from renewals will occur in year two
which is one of the key benefits of owning a TLD. Cash Cow!

9. Cash Inflows
Cash inflows decrease due to
the lower registration volume
and price
Cost of sales decrease from
$150k to $129k – related to
registry fees
Gross margin decreases by
$236k – no real magic.
Generic Short TLD
Projected Cash Flows Year 1 Year 2 Year 3
Worst
Projected Cash Inflows & Outflows
Domains Under Management 13,120 39,400 78,053
Registration Volume in Domain Years 17,291 49,536 97,370
Cash Inflows
Registrations 334,194 765,900 1,210,564
Premium Name Auctions (New & Renewals)431,250 191,563 61,891
Sunrise Registrations 118,000$ -$ -$
Landrush Registrations 1,464$ -$ -$
Other Cash Inflows - interest 29,050 36,419 43,546
Best ONLY Revenue streams - - -
Total - Cash Inflows 913,958$ 993,881$ 1,316,001$
Total Cash Outflows:
Cost of Sales (cash)
Registry Fee - Per Domain 56,196 104,796 155,462
ICANN Fees - Quarterly Fixed 25,000 25,000 25,000
Premium Name Fees 47,438 15,813 -
Total 128,634$ 145,609$ 180,462$
Gross Margin (cash Sales Basis) 785,324$ 848,273$ 1,135,539$

10. Cash Outflows –
COS & Labor
This registry believes their TLD
marketing is related to the volume of
registrations and increases their
marketing labour.
Marketing costs increases from the most
likely scenario with $300k in yr 1 & 2 and
$200k in yr 3;
Escrow fees decline minimally due to the
decreased in registrations
Generic Short TLD
Projected Cash Flows Year 1 Year 2 Year 3
Labor:
CEO/Manager -$ -$ -$
Marketing 135,000 138,375 141,834
Customer Service 36,000 40,000 41,000
Admin 36,000 40,000 41,000
Total Labour 207,000 218,375 223,834
Marketing Costs - Var 300,000 350,000 400,000
General & Admin 45,000 45,000 115,000
Professional Fees - Legal 24,000 15,000 12,000
Other: COI Costs 1,000 1,000 1,000
Other: Escrow: Fixed 2,000 - -
Other: Escrow Variable 4,250 8,700 16,800
Miscellaneous - - -
-
Total Operating Cash Outflows 583,250 638,075 768,634
Taxes - - -
Total Operating Cash Outflows 711,884$ 783,684$ 949,097$
Discounted Ooperating Cash Outflows 674,615$ 672,862$ 736,961$
Projected Net Operating Cash Flow (cash basis)202,074$ 210,198$ 366,904$
Cumulative 412,272$ 779,176$

11. -$400,000
-$200,000
$0
$200,000
$400,000
$600,000
$800,000
$1,000,000
$1,200,000
$1,400,000
$1,600,000
Year 1 Year 2 Year 3 Year 4 Year 5
Total - Cash Inflows
Total - Recognized Revenue
Gross Margin (accounting sales
basis)
Total Operating Cash Outflows
Net Income
Linear (Net Income)
Generic TLD 5 Year View

12. gTLD Focus on the Food &
Restaurant Industry
Wholesale Price $15
Worst Case Scenario
In this worst case scenario, management has chosen to minimize expenses and
not invest in additional marketing activities to increase registrations

13. Registration Volume
This TLD is within the food and
restaurant industry and plans to target
specific niche’s within the industry.
Certain exporters are related to a
specific geographic area within the
world.
This TLD is also more expensive as it was
in Contention (more than one applicant
applied for it) and was auctioned off to
the winner who paid the most in auction
Restaurant/Food TLD
Projected Cash Flows Year 1 Year 2 Year 3
Worst
Part A: Restaurant/Food Industry 4,790 5,628 5,520
Penetration Rate
# of Purchases 3,830 4,502 4,416
Part B: Speciality Restauranats 11,280 12,852 12,216
Penetration Rate
# of Purchases 9,020 10,282 9,773
Part C: Producers/Exporters 830 950 903
Penetration Rate
# of Purchases 660 760 722
Part D: Specialty Niche Target Rest. 520 533 451
Penetration Rate
# of Purchases 410 427 361
Part E: Existing Domains 7,750 8,138 7,120
Penetration Rate
# of Purchases 6,200 6,510 5,696

14. Cash Inflows
As purchasers can buy a domain name
for more than one year, the number
of domains in years can be higher
than the number of names purchased
Sunrise registrations is the
preregistration from trademark
holders which often includes an
‘application fee’
Premium names sell at a higher price
and can also renew at this higher
price.
Restaurant/Food TLD
Projected Cash Flows Year 1 Year 2 Year 3
Worst
Total Registration Volume in Years 29,005 74,959 129,584
Sunrise 400 - -
Landrush 2,500 - -
# Purchases 20,270 35,791 42,536
Premium Domains: 150 178 176
29,005 45,954 54,626
Projected Cash Inflows & Outflows
Domains Under Management 23,170 58,961 101,497
Registration Volume in Domain Years 29,005 74,959 129,584
Cash Inflows
Registrations 368,943 650,703 774,003
Premium Name Auctions (New & Renewals)375,000 512,750 765,088
Sunrise Registrations 27,600$ -$ -$
Landrush Registrations 61,000$ -$ -$
Other Cash Inflows - interest - - -
Best ONLY Revenue streams - - -
Total - Cash Inflows 832,543$ 1,163,453$ 1,539,091$

15. Cash Outflows –
COS & Labor
ICANN Fees are a minimal of $25k/yr
with a charge of $.25 per year when
the volume exceeds 50,000 names
Premium name fees are the
commissions paid to the seller of the
premium name
Labour varies depending on the
company, existing resources, purpose
of the TLD, etc.
Restaurant/Food TLD Start-Up
Projected Cash Flows Costs Year 1 Year 2 Year 3
Total Cash Outflows:
Cost of Sales (cash)
Registry Fee - Per Domain 113,768 168,583 193,696
ICANN Fees - Quarterly Fixed 185,000 25,000 25,000 25,000
ICANN Fees - trx fee - Var - - -
Premium Name Fees 41,250 55,000 82,500
Misc. Fees 10,683 95,211 32,201
Total 190,701$ 343,794$ 333,397$
Gross Margin (cash Sales Basis) 641,842$ 819,659$ 1,205,694$
Labor:
CEO/Manager 100,000 100,000$ 100,000$ 100,000$
Marketing Director 100,000 90,000 92,250 94,556
Customer Service 80,000 73,542 153,897
Technical Director 102,000 91,800 118,008 172,650
Expenses - Best ONLY - - -
Total Labour 361,800 383,800 521,103

16. Cash Outflows &
Net Income
Restaurant/Food TLD Start-Up
Projected Cash Flows Costs Year 1 Year 2 Year 3
Marketing Costs - Var No 200,000 200,000 300,000 250,000
Senior Security Consultant Services Yes 100,000 90,000 99,000 108,900
General & Admin Yes 115,000 103,500 125,500 115,000
Professional Fees - Legal Yes 250,000 250,000 256,250 236,391
IP Clearninghouse No - 70,000 - -
Other: COI Costs No 1,000 1,000 1,000 1,000
Other: Escrow: Fixed Yes One-Time 2,500 - -
Other: Escrow Variable Yes 0% 7,850 11,000 13,750
Miscellaneous No 25,000 25,000 25,000 25,000
Debt Payment - - -
-
Total Operating Cash Outflows 1,111,650 1,201,550 1,271,144
Taxes - - -
Total Operating Cash Outflows 1,450,351$ 1,645,344$ 1,804,541$
Discounted Operating Cash Outflows 1,380,010$ 1,413,188$ 1,403,128$
Projected Net Operating Cash Flow (cash basis) (469,808)$ (381,891)$ (65,450)$
Cumulative (851,698)$ (917,148)$
To date, marketing of new gTLDs
has not been significant and its
impact on volume is difficult to
predict
Security costs vary by TLD and
their mission i.e. the impacts of
satan.bible could have severe
impacts while other registries
believe in free speech with no
related security and legal costs
In the worst case, this TLD is losing
money in years 1 to 3

17. gTLD Focus on the Food &
Restaurant Industry
Wholesale Price $15
Most Likely Scenario
.diet, .fish, .farm, .pizza

18. Registration Volume
Restaurant/Food TLD
Projected Cash Flows Year 1 Year 2 Year 3
Most Likely
Part A: Restaurant/Food Businesses 4,790 5,628 5,520
Penetration Rate
# of Purchases 4,790 5,628 5,520
Part B: Speciality Restaurants 11,280 12,852 12,216
Penetration Rate
# of Purchases 11,280 12,852 12,216
Part C: Producers/Exporters 830 950 903
Penetration Rate
# of Purchases 830 950 902
Part F: Speciallty /Niche Restaurants 520 533 451
Penetration Rate
# of Purchases 520 533 451
Part G: Existing Domains 7,750 8,138 7,120
Penetration Rate
# of Purchases 7,750 8,137 7,120
Registration Volume in Years
Opening Balance - 37,769 96,459
New Additions 37,769 58,690 68,955
Total Registration Volume in Years 37,769 96,459 165,414
This TLD is within the food and restaurant
industry and plans to target specific niche’s
within the industry.
Certain exporters are related to a specific
geographic area within the world.
This TLD is also more expensive as it was in
Contention (more than one applicant
applied for it) and was auctioned off to the
winner who paid the most in auction

19. Cash Inflows Restaurant/Food TLD
Projected Cash Flows Year 1 Year 2 Year 3
Most Likely
Sunrise 650 - -
Landrush 4,500 - -
# Purchases 25,320 45,664 53,644
Premium Domains: 150 178 176
37,769 58,690 68,955
Projected Cash Inflows & Outflows
Domains Under Management 30,470 76,134 129,778
Registration Volume in Domain Years 37,769 96,459 165,414
Cash Inflows
Registrations 461,546 831,747 977,690
Premium Name Auctions (New & Renewals)375,000 512,750 765,088
Sunrise Registrations 44,850$ -$ -$
Landrush Registrations 109,800$ -$ -$
Other Cash Inflows - interest - - -
Best ONLY Revenue streams - - -
Total - Cash Inflows 991,196$ 1,344,497$ 1,742,778$
Resulting increased registrations
of ~8,800 registrations in yr 1;
~12,700 in year 2 & Year 3
~15,300
Results in an increase of over
$543k over three years
Reflects the simple equation that
the volume and price of
registrations is key!

20. Cash Outflows
– COS & Labor
Cost of sales have nominal changes
However, increase to labour due to the
increased registrations and efforts
In some cases, registries have decided to
build out some of their own domain names
for increased revenues and expenses via a
separate corporation
Restaurant/Food TLD Start-Up
Projected Cash Flows Costs Year 1 Year 2 Year 3
Most Likely
Cost of Sales (cash)
Registry Fee - Per Domain 146,635 213,119 241,698
ICANN Fees - Quarterly Fixed 185,000 25,000 25,000 25,000
Premium Name Fees 41,250 55,000 82,500
Other Fees 40,000 58,000 64,098
Total 300,885$ 351,119$ 413,296$
Gross Margin (cash Sales Basis) 690,311$ 993,378$ 1,329,482$
Labor: Cost of Living Adj?
CEO/Manager Yes - 100,000$ 100,000$ 100,000$
Marketing Director Yes 200,000 100,000 105,000 110,125
Customer Service Yes 150,000 150,000 173,542 253,897
Technical Director Yes 102,000 102,000 118,008 172,650
Expenses - Best ONLY No - - -
Total Labour 452,000 496,550 636,672
Restaurant/Food TLD Start-Up
Projected Cash Flows Costs Year 1 Yea
Most Likely
Cost of Sales (cash)
Registry Fee - Per Domain 146,635 213,11
ICANN Fees - Quarterly Fixed 185,000 25,000 25,00
Premium Name Fees 41,250 55,00
Other Fees 40,000 58,00
Total 300,885$ 351,11$
Gross Margin (cash Sales Basis) 690,311$ 993,37$
Labor: Cost of Living Adj?
CEO/Manager Yes - 100,000$ 100,00$
Marketing Director Yes 200,000 100,000 105,00
Customer Service Yes 150,000 150,000 173,54
Technical Director Yes 102,000 102,000 118,00
Expenses - Best ONLY No - -
Total Labour 452,000 496,55

21. Cash Outflows &
Net Income
Escrow Fees have both a fixed
and variable portion to them
Some TLDs have investors or
loans that require repayment
Restaurant/Food TLD
Projected Cash Flows Year 1 Year 2 Year 3
Marketing Costs - Var 300,000 350,000 300,000
Senior Security Consultant Services 100,000 110,000 121,000
General & Admin 115,000 127,354 146,390
Professional Fees - Legal 250,000 256,250 236,391
IP Clearninghouse 70,000 - -
Other: COI Costs 1,000 1,000 1,000
Other: Escrow: Fixed 2,500 - -
Other: Escrow Variable 8,450 11,600 15,000
Miscellaneous 25,000 25,000 25,000
Debt Payment - - --
Total Operating Cash Outflows 1,323,950 1,377,754 1,481,453
Taxes - - -
Total Operating Cash Outflows 1,624,835$ 1,728,873$ 1,894,749$
Discounted Ooperating Cash Outflows 1,544,745$ 1,482,846$ 1,471,100$
Projected Net Operating Cash Flow (cash basis)(633,639)$ (384,376)$ (151,971)$

22. Current Project
Delegation to occur this week
Sunrise in April
General Availability in June

23. Generic but has niche markets

24. Registration Volume
Actual industry size and penetration rates
have been hidden but the volume
projections by market are shown
.LOVE is doing an Early Launch Program
instead of Landrush which is different
from other examples, it also gets the TLD
into General Availability faster.
Projected Cash Flows Year 1 Year 2 Year 3
Most Likely
Part A: Romance & Occasions 2,061 2,880 3,024
Part B: Passions 1,125 3,984 8,472
Part C: Literature 1,422 1,938 1,977
Part D: Hobbies, Places, People 1,872 2,750 3,025
Part E: Dating 9,369 11,813 11,025
Part F: Wedding & Love Story 4,500 6,600 7,260
Part G: Existing Domains 3,312 10,935 21,652
Part H: Existing Domains ending w/ .LOVE 1,836 2,335 2,219
Registration Volume in Years
Opening Balance - 34,451 102,220
New Additions 34,451 67,768 108,861
Total Registration Volume in Years 34,451 102,220 211,080

25. .LOVE
Projected Cash Flows Year 1 Year 2 Year 3
Most Likely
Sunrise 2,000 - -
Landrush - - -
# Purchases 25,735 57,424 92,079
Premium Domains: 238 217 184
34,451 67,768 108,861
Projected Cash Inflows & Outflows
Domains Under Management 27,735 85,158 177,238
Registration Volume in Domain Years 34,451 102,220 211,080
Cash Inflows
Registrations 730,394 1,632,987 2,627,161
Premium Name Auctions (New & Renewals)191,667 48,427 9,217
Sunrise Registrations 236,000$ -$ -$
Landrush Registrations -$ -$ -$
Other Cash Inflows - interest - - -
Best ONLY Revenue streams - 1,800 3,780
Total - Cash Inflows 1,158,060$ 1,681,414$ 2,636,379$
Cash Inflows
We are targeting June as we would
prefer not to launch in the
summertime when the cyclical nature
of domain registrations is lower
Premium name numbers have been
altered for confidentiality purposes
One target market has additional
revenue streams that we hope to roll
out to add additional benefits to
domain buyers

26. Cash Outflows
– COS & Labor
Registrar Fees is for an expected
promotion program to have users
build a website and in return, receive
a reduction in fees.
Once someone builds a website,
they are more likely to renew the
domain name in future years
.LOVE
Projected Cash Flows Year 1 Year 2 Year 3
Total Cash Outflows:
Cost of Sales (cash)
Registry Fee - Per Domain 75,793 149,090 239,495
ICANN Fees - Quarterly Fixed 25,000 25,000 25,000
Premium Name Fees 21,083 4,217 -
Registrar Fees 73,039 163,299 262,716
Total 194,916$ 341,605$ 527,211$
Gross Margin (cash Sales Basis) 963,144$ 1,341,609$ 2,112,948$
Labor:
CEO/Manager -$ -$ -$
Marketing 150,000 153,750 157,594
Customer Service 40,000 40,000 41,000
Expenses - Best ONLY - - -
Total Labour 190,000 193,750 198,594

27. Cash Outflows &
Net Income
Marketing expenditures targeting
the areas with large volumes are
in place along with general TLD
awareness with other TLDs
Lean organization with the
utilizing of existing business
resources
In the most likely scenario, all
three years are profitable with
increases in year 2 & 3 due to the
cash cow affects
.LOVE
Projected Cash Flows Year 1 Year 2 Year 3
Total Cash Outflows:
Marketing Costs - Var 500,000 400,000 300,000
Outsourcing 30,000 30,000 30,000
General & Admin 50,000 50,000 146,390
Professional Fees - Legal 24,000 24,000 12,000
Travel 75,000 75,000 75,000
Other: COI Costs 1,000 1,000 1,000
Other: Escrow: Fixed 2,000 - -
Other: Escrow Variable 5,925 15,875 30,000
Miscellaneous 8,000 8,000 8,000-
Total Operating Cash Outflows 885,925 797,625 800,984
Taxes - - -
Total Operating Cash Outflows 1,080,841$ 1,139,230$ 1,328,195$
Projected Net Operating Cash Flow (cash basis)77,219$ 543,984$ 1,311,964$
Cumulative 621,203$ 1,933,167$