Fund.com Acquired in Record Purchase (FNDM)

Fund.com Inc. (OTC: FNDM) set a new world record yesterday after it purchased the domain Funds.com for $9,999,950 in an all-cash transaction, according to an 8-K filing with the SEC. FST Limited decided to part with the domain and associated intellectual property in an purchase agreement dated October 1st of last year, which broke the record previously held by Business.com, which was sold for $7.5 million in 1999. So, what does Fund.com Inc. have planned for this new domain?

According to their 10-K filing with the SEC, Fund.com said that its new web presence will provide customers with free information about investment funds including original, aggregated and community selected articles about the fund industry, statistics on fund performance and other fund-specific detail. The objective is to establish Fund.com as a source of information for individual investors regarding investment funds, including mutual funds, hedge funds, money market funds, exchange traded funds, closed-end funds, commodity funds and other types of pooled investment vehicles.

What does this mean for investors? Fund.com plans to monetize the web property via online advertising, lead generation and referral fees. One of their subsidiaries, Fund.com Managed Products Inc., will also research and develop intellectual property in the form of fund investment indexes and related index-linked investment products and license these to third parties in consideration for recurring license fees paid to them based on a fixed percentage of assets managed by such their parties using their index-linked investment products.

Who will use this service? Fund.com believes that their target market is a multi-trillion dollar industry as reported by the Investment Company Institute (ICI). Hundreds of billions of dollars flow in and out of funds that receive money from individuals and investment firms. Fund.com believes that third party distribution of funds has largely been undertaken by financial advisors with traditional marketing channels, including in-person client meetings with brokers, so these are all marketing efforts that could be augmented with Funds.com.

In the end, the success of Funds.com remains to be seen after the record-breaking purchase. Regardless, this is definitely a stock that is worth watching over the next few months!

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