Scrolling through my RSS feeds this morning, I noticed on DealerRefresh that Dominion Enterprises acquired another company, definitely not surprising, but I think it’s interesting, in light of their recent history. I am not sure if anyone has ever dealt with Dominion Enterprises, but they are one of oddest run companies that I’ve ever come across.
They own a large number of web properties and classified sites, including: Cycletrader.com, Boattrader.com, Boats.com, Forrent.com and a slew of others (I think over 70). What’s weird to me is that the individual properties almost never interact with each other, despite some of the companies sharing the same building, and perversely, Dominion actually forces companies to actively compete against each other.
A little Dominion Enterprise History, first though. Dominion Enterprises emerged from what was Trader Publishing. Trader Publishing was started as a joint venture between Cox Enterprises (the parent company of Manheim) and Landmark Communications back in 1991. Over the years, Trader grew through internal growth and acquisitions from $150 million in annual sales to $1.3 billion.
In May of ’06, Cox and Landmark decided to end this relationship and two new companies were created. CoxAutotrader gained control of all of Trader’s Auto classifieds, which included sites like Autotrader.com, Automart.com, and Autoextra.com. Dominion Enterprises, Landmark’s company, gained control of the non-auto classifieds and other companies. Including, Boats.com, Boattrader.com, Harmonhomes.com, 123movers.com and many more. Quick note on Autotrader: Autotrader is also owned by Kleiner, Perkins, Caufield & Byers, a top notch venture capital fund based in Menlo Park, California. Now back to Dominion Enterprises and examples of their quirky behavior.
TraderPublishing launched Boattrader.com in 1996 and ending up acquiring Boats.com & Yachtworld.com in 2004, a competing company. Then, in 2007, Dominion Enterprises launched Yachttraderonline, a competitor to Yachtworld.com. All of these companies compete against each other, they aren’t even headquartered in the same location – Boats.com is in Seattle, Boattrader in Norfolk. While competition is usually good for the consumer, companies acquired by Dominion tend to stagnate. Most of the properties launched by Dominion still use the same 1990s-style web design.
The usual justification for an acquisition, or merger, is the either the efficiencies that can be gained by having two companies pool resources, purchasing, and knowledge share, or diversification of revenue. In this case, diversification is clearly not the reason, so it might be efficiencies. But based on the silo mentality that Dominion uses to manage their companies, it is unlikely you’ll see an integration of Dealerskins & Autobase, which would make sense. Instead, expect Autobase to become a less nimble company, unable to respond as quickly as desired to their user needs because of a larger corporate parent.