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Q&A: Monetizing MX Records with Sean Stafford of Bounce.io

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seanstaffordI recently caught-up with my friend Sean Stafford who has a long history in the hosting area.  He is doing some neat things that allow hosters to monetize MX records and will be speaking at HostingCon this year. Below are notes from my interview with him:

Stacy Griggs: Tell me a little about yourself?

Sean Stafford: I have been in the domain and web hosting industry for a little over 10 years. During my career, I have always been fascinated by the different monetization strategies surrounding domains. I met with Scott Brown (founder and CEO of bounce.io) and was offered an amazing opportunity to provide a new form of monetization for domains and more. Now, not only am I working on domain monetization, but I’ve been given the opportunity to expand into other areas of monetization for mailboxes and web hosting. I’m also excited to share that I will be speaking on the “New TLDs: Good or Bad” panel at the upcoming HostingCon conference in June.

SG: What is the story with Bounce.io?

SS: At bounce.io, we make bounces better. If you’ve ever sent an email to an address that didn’t exist then you’ve seen a bounce. Typically a 550 bounce has a very technical, unintelligible response with a bunch of computer jargon that only an engineer would understand. Something like that isn’t helpful to most people so bounce.io set out to change that.

Our focus is multi-faceted.We improve the user experience by removing the jargon-filled, plain text bounces that are always English (regardless of the senders language), to something that anyone can understand. We also make sure that the bounce can get delivered in the language of the originating sender.

In addition we monetize each bounce with tasteful advertising which creates a new revenue source for our customers while improving the overall bounce messages to their clients.

We work with all sorts of customers: mailbox providers like ISPs and MSO’s, web hosting companies, and domain owners – basically, anyone with a mailbox or a MX record.

SG: How do you monetize MX records?

SS: Domain owners typically do not think of their parked domains MX records as a revenue generator, but there is absolutely value there. A domain owner can make use of these MX records by adding an MX record that points to bounce.io. That’s it.  Once the records are in place, we start handling the bounces and money begins accruing in the account immediately. The same process also works with large domainers who run their own DNS systems or other scenarios where a person has access to the MX and TXT records of a portfolio of domains.

Mailboxes from hosting companies are another stream of revenue that is often overlooked.  This is very similar to the bounce process described above, though the only difference is that instead of modifying DNS records, the company would modify their mailserver bounce configuration.  And to be clear, when we talk about these bounces we are referencing bounces that mailbox providers are already processing daily for their current customers.  These are not new emails, just enhancing what is already happening.

SG: How much does the average hosting company, registrar, or parking company make?

SS: This one is a bit tricky because there are so many different scenarios. Some domains and hosting company mailboxes generate a tremendous amount of email while others might generate less. It all depends on the quantity of the user count (mailboxes) or inbound mail (domains). But considering that there are about 31 billion bounces generated every day there’s a lot of money to be made.

SG: Now for an odd ball question. You have been in the hosting space for a long time, what do you see as the biggest change in hosting in the next five years?

SS: There will likely be a lot of pricing pressure as the cost of storage and processing power keeps going down.  The likely result is increased market consolidation and the hunt for new streams of revenue in a market that has a pricing model which has gotten historically cheaper over time and really sliced profit margins. Anything that drives new revenue from an untapped source is definitely important going forward and that’s why new money generating solutions makes so much sense.

About the Author

Stacy Griggs is the President and CEO of El Toro Internet Marketing www.eltoro.com. Mr. Griggs leads day-to-day operations at El Toro and is also one of the creators of El Toro’s patent for IP Targeting. Stacy has led three different organizations that were recognized by Inc. Magazine on the Inc. 500 list as the fastest growing privately-held companies in the United States. Prior to joining El Toro, Stacy was President and CEO for Align Cloud, a cloud consulting company. Previously, Mr. Griggs was an executive for Cbeyond, a publically traded cloud communications company (Nasdaq: CBEY). He joined Cbeyond in 2010 as part of the acquisition of MaximumASP where he was Vice President of Sales and Marketing. Prior to MaximumASP, Stacy held a series of positions at Hosting.com, including Chief Sales Officer, Chief Service Officer and General Manager for their flagship Delaware datacenter. Mr. Griggs has led several information technology services companies earlier in his career. He was a Managing Director for KForce, a $1 billion publicly traded professional services firm. At KForce he managed a number of business units that collectively generated $18 million in revenue and comprised 140 employees. Prior to KForce, he served as a Vice President and co-owner of Diamond Technologies, an 80-employee custom software development firm. Additionally, he held management positions at TMP Worldwide and the University of Pennsylvania at the beginning of his career. Stacy has also served in various positions on a number of nonprofit boards including Vice Chairman for the New Castle County (Delaware) Chamber of Commerce, Co-Chairman of the United Way of Delaware’s Young de Tocqueville Society, and as a Director for the Caesar Rodney Rotary, the Sunday Breakfast Mission, and Junior Achievement of Kentucky. Additionally, Mr. Griggs currently serves as a volunteer firefighter with the Simpsonville Rural Fire District in Shelby County, KY Named to the 30 under 30 by Philly Tech Magazine, he was also appointed by Delaware Governor Ruth Ann Miner to a term on the Delaware Workforce Investment Board. Through his theWHIR blog, Stacy will touch upon sales and service in the Web hosting space, web hosting events, cloud computing and industry trends.

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