.Choice: With $100M+ Raised, Donuts Launches A Registry For New Top-Level Domain Names

Last year, the Internet Corporation for Assigned Names and Numbers (ICANN) approved a new initiative that is set to significantly expand the number of generic top-level domains (gTLDs), allowing companies, organizations, and anyone in between to buy their own domain name extensions — like .google, .rip, .ROFL, etc.

ICANN recently closed its window for domain name applications, and last week, for example, Frederic covered Google’s announcement of the domains it has applied for (.google, .docs, .youtube, and .lol to name a few), which was yet another indication that it won’t be long before gTLDs of this ilk will be common on the Web.

ICANN expects to create between 300 and 1,000 new gTLDs each year, joining the 28 ubiquitous Top-Level Domains in play today, like .com, .org., .net, and so on. Of course, as Frederic noted, there’s been plenty of resistance against the new domain order, with companies complaining that the new process (which requires applications to pay a $185K evaluation fee, with more added on once apps are accepted) will require them to cough up too much dinero in an effort to secure trademarks.

However, Google is far from being alone in its application for new TLDs — there are plenty more that see this is an opportunity. Today, the appealingly-named Donuts, Inc. is launching to the world, simultaneously announcing a move to expand the Internet namespace with a not-so-bite-sized set of 307 applications for new gTLDs. Donuts, a registry for new top-level domain names, believes that this expansion will help bring new industry competition and a fresh set of choices to the world’s Internet users looking for better, more specific domains for their products and services.

To do so, Donuts is announcing that it has raised over $100 million in capital from private equity and venture funds to help it secure and operate each applied-for domain name, with contributing investors including Austin Ventures, Adams Street Partners, Emergence Capital Partners, TL Ventures, Generation Partners, and co-founder and chief exec Paul Stahura’s investment fund, Stahurricane, to name a few. The company also said that it’s ready to raise additional funding if necessary, and has obtained a revolving credit facility with Comerica Bank.

Donuts co-founder and EVP Dan Schindler tells us that Donuts leadership believes that the current namespace, which is the “very fulcrum of commercial online navigation,” is extremely constrained today and that both consumers and businesses are in dire need of more choice when it comes to their Internet identities.

With more than 125 million total names in the top five TLDs (with 75 percent of those being .com domains), finding a solid, brand-able web address has become a serious problem. The co-founder believes that opening the doors to a variety of new domain names will bring some much-needed competition to the long-enthroned .coms of the world, although just how much competition (and how much disruption) remains to be seen.

But, Donuts does have a point that competition implicitly means lower prices, with names in new TLDS are going to be far, far less expensive than .com names at auction or in the aftermarket. As Schindler suggested, “theater.tickets at $500 is better than theatertickets.com at $125,000.”

Updating

For more on Donuts, Inc., check them out at home here.