In this edition of On the Record, we speak with Woody Levin, Extend’s co-founder, and CEO, about how he managed to acquire Extend.com within just 48 hours of first contacting the owner.
Woody, a serial entrepreneur, has made a career of using technology to find and fix inefficiencies in various markets that can benefit consumers and businesses alike. From Estate Assist to BringIt, Levin has built four companies, with Extend being his fifth.
Recently, I had the pleasure of talking with Woody about Extend, his purchase of Extend.com, and how important the domain name is to the company as they strive towards a multi-billion dollar valuation.
What does Extend do, and how does it use technology to counter perceived inefficiencies?
Extend offers an easy way for any merchant to provide extended warranties with their products. With Extend, we identified three things when we came up with the idea for the company:
- There is a distribution problem where not every merchant could offer an extended warranty protection plan on the products they sell. Amazon, Costco, and Best Buy all offer extended warranties, but for the rest of the market – smaller merchants – there is no level playing field.
- The customer experience behind warranties or protection programs was broken. You have to have a copy of your receipt, you have to wait on hold, it takes 3-5 days to have your claim adjudicated. No one had created an AppleCare-like experience for extended warranties.
- On average, the number of people who chose to add an extended warranty, when prompted, was extremely low. Just 4% to 5% industry-wide. We felt that through Machine Learning and multi-variance testing (different content and different visuals), that we could get that higher. We’re currently sitting at over 10%, double the industry average.
The extended warranty offers at a merchant’s point of sale platform are always branded “Extend”. This was done for legal reasons, as well as to avoid customer confusion. Most importantly, though, we are creating a consumer-facing brand that customers can trust. As consumers see “Extend” on merchant websites over and over again, we think that will drive us additional trust, and additional business.
Extend is the perfect brand name for what Extend currently offers. Were there any other considerations for a brand name, or was it always Extend?
It’s funny, my wife actually came up with Extend. I’m a sports guy, and I wanted to call it Overtime! She thought this was a really poor idea, and she said: “Why don’t you call it Extend?” Extend is a way better name.
You launched with HelloExtend.com – a two-word name. Why did you choose this domain? Was it purely because it was available to register?
We saw that, at the time, Extend.com was owned by Cisco, so we bought HelloExtend.com instead, for $9. As the business grew, it became more and more apparent to us how important our brand was going to be, so I’d constantly check Extend.com to see what was going on, and I had considered reaching out to Cisco to see if we could buy it because they weren’t using it.
How did you first find out Extend.com was for sale?
One Saturday night, one of my partners sent me something to show me what a subdomain looked like. The link, I believe, was “claims.extend.com”, but we were using HelloExtend.com. Clicking “claims.extend.com” took me to a page telling me the domain was for sale. Cisco didn’t own the name anymore.
I was shocked, and in my mind, I tried to work out how valuable the domain was to the business, and how much we’d pay for it.
It’s been reported that it took just 48 hours for the sale to close. How did you accomplish that?
We’d only raised a seed round at that time, and I had a number in my head of which I would pay. I wound up paying double that because there is only one Extend.com in the World. I thought that if we don’t get it now, we will never ever be able to get it.
On that Saturday night, I tried to get hold of my board, but couldn’t. I talked to one of my co-founders who agreed on the number I had in my head. I went back and forth with James Booth, the new owner. I tried to negotiate, but he held firm, and I made the decision there and then that we had to have it.
The next day, I talked to a board member who was our lead investor who said “absolutely, I’m glad you did it. If you’re going to own an enduring brand, you need to own that domain.” We managed to get the transaction done quickly.
How did you go about valuing the domain to determine how much to pay? Did you consult anyone, or use and domain sales data?
A friend of mine runs a company called Step, and he bought the domain Step.com. I knew what he paid for Step.com – a four-letter, one-word domain. So there was some data behind it but at the end of the day, we thought that it was so valuable to the business that as long as it was a reasonable number, we thought that it was a strong investment in the company’s future.
Again, there is only one Extend.com. That’s our name, and the domain is so perfect for us, so it was very difficult to think of a reason not to do the deal.
That being said, we weren’t going to be held hostage for the domain. We weren’t going to pay $1 million for Extend.com.
Did consumer trust have an influence on your decision to buy the domain?
We’re building a consumer-facing brand. We’re selling extended warranties to consumers across hundreds, soon to be thousands, of merchant partner websites. We need our customers to know where to go to file a claim.
If I have an extended warranty from Extend, where’s the first place I’m going to file a claim? Extend.com. If we’re not on Extend.com, it will materially, negatively affect a customer’s perception of the business and their experience, and we can’t have that.
If Extend.com had already been taken by another company, would you have rebranded, or would you have bought a domain like Extend.co, or Extend.io?
I’m not a fan of hypotheticals, so the good thing is that we were able to act quickly and avoid that situation. We like to be proactive as we continue to build this business rather than reactive, and I think this is a very good example of that.
For a company that’s called Extend, which is a consumer-facing brand, the domain is the be-all-end-all digital destination. Our customer touchpoint, where merchants go to get information about us, is our website. That’s where people can go to file a claim, so it was really important for us to own Extend.com.
Extend is still a young company, having formed in 2019. Why did you feel it was important to upgrade your domain name early on?
I think that you have to believe in the business. You have to believe that this is a sustainable opportunity. You have to believe in the trajectory that we’re on, and be willing to spend a meaningful portion of your cash reserves on the acquisition.
We had to believe that it was going to be an important part of the infrastructure of the business, the fabric of the business that will help it to grow.
Have you been able to notice any significant changes in traffic, or sign up conversion rates since switching to Extend.com, which you can attribute to the domain change?
We definitely have seen an increase in traffic. We’ve received emails about other companies’ extended warranty plans just because the consumer has typed in Extend.com and come to our website. Our customer service team lets them know that we don’t underwrite that plan, but we let them know how to get in touch with the other company.
From a level of professionalism, not having that “Hello” at the beginning of our name is very helpful. We used to get email introductions referring to us as HelloExtend, rather than just Extend.
Owning Extend.com makes us seem, and feel, and act like a standalone multi-billion dollar corporation, which we’re not yet, but I think we will be.
What advice would you give to any company looking to rebrand to a premium domain name?
If you have the opportunity, and you can afford it, you should do it. You need to understand what the appropriate amount of spending is and the appropriate amount of capital allocation is at the time, but if you have the opportunity to buy the single-word .COM domain for your company, I think you shouldn’t question buying it.
Thanks to Woody for taking the time to participate in On the Record. You can find out more about Extend by visiting Extend.com or following @HelloExtend on Twitter.