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Donuts, the deliciously named domain registry startup, closed a very sweet $100 million mega round of funding, the company announced today.
Donuts is focused on becoming a new registry for generic top-level domains (gTLDs), or the domain extensions that will go beyond simply .com, .net, .org, and others. Regulators have previously capped the total number of gTLDs at 22 total extensions, but that is about to change thanks to a decision by ICANN (Internet Corporation for Assigned Names and Numbers) back in June.
So while the startup doesn’t deal in fried, icing-covered pastries it could — hypothetically speaking — eventually provide people with a way to buy domains that end in .bearclaw or .jellyfilled. These particular extensions would make perfect sense for someone who wanted to build a website for their donut shop. The same is true for other categories of business (e.g. .doctor, .chef, .plumber). That doesn’t mean Mr. Donut Shop Owner will be purchasing .bearclaw from Donuts though. The startup plans to sell domain access to third-party commercial registrars like GoDaddy and Tucows.
ICANN anticipates between 300 and 1,000 new TLDs could be created per year under the new domain extension program. For Donuts, that means there’s an opportunity to get a head start on a new business market. The startup has applied to secure and operate over 300 different gTLDs, with a focus on generic words and categories. The Wall Street Journal reports that Donuts hasn’t applied for any gTLDs for locations or trademarks.
Since the market place for gTLDs is still very new, it’s unknown exactly what kind of competition Donuts will face going forward. However, with the rate of gTLDs likely to increase exponentially over the next decade, It’s a good assumption that a “wholesale” domain registry company like Donuts will have plenty of opportunities to generate revenue.
Donuts said it plans to use the new capital primarily ensure winning bids on additional gTLDs, hiring more employees, and marketing its domain service. Also, coffee.
Founded in 2012, the startup has offices in Los Angeles, Calif.; Seattle, Wash.; and Washington, D.C. Donuts currently has eight full-time employees, with plans triple that number over the next year. The round of funding, the startup’s first, was led by Austin Ventures, with participation by Adams Street Partners, Emergence Capital, TL Ventures, Generation Partners, Stahurricane, and others.