NH Internet company growth fueled by acquisition strategy
This code on the door at Dyn's Millyard office in Manchester alludes to the Internet addresses the company maintains for its customers. (THOMAS ROY/UNION LEADER FILE)
MANCHESTER — Dyn, an Internet infrastructure provider and one of the state's fastest growing businesses, is accelerating its growth with an aggressive acquisition strategy.
In the past three years, the company has invested a little under $10 million, all of it self-funded, to expand its holdings and acquire new talent to drive its primary business in domain name services (DNS) and email delivery for e-commerce, small business and personal users, according to Gray Chynoweth, chief operating officer.
The most recent purchase was announced on Sept. 20, as Dyn, with international headquarters on Dow Street, acquired TZO, a Pepperell, Mass.-based DNS provider, in a $4 million transaction.
“In addition to some amazing talent, we are getting access to a significant customer base and some perspectives on DNS technology that we might be able to deploy to our existing customers,” Chynoweth said. The Pepperell office is being closed and all 11 TZO employees are relocating to Dow Street, bringing Dyn’s work force in Manchester to 170 employees.
“We’re excited about the purchase because there are not that many DNS experts in the world, and we just got to bring several more of those onto our team,” Chynoweth said.
The TZO purchase comes just two weeks after Dyn announced it had acquired the talent of the SEO, SEM and e-commerce division of Incutio, a company based in the United Kingdom. Rather than acquire the company outright, Dyn executives convinced the ownership and staff of Incutio to wind down their business and start a search engine marketing group within Dyn. There was no cash involved other than a signing bonus for the six new Dyn employees.
Those recent moves follow major acquisitions in 2010, when the company purchased EveryDNS and EditDNS in separate transactions, and in 2011, when the purchase of SendLabs allowed Dyn to begin offering enterprise, or automated, email delivery.
Originally incorporated in 2011 as Dynamic Network Services, Dyn (now the company’s formal name) has consistently placed in Inc. magazines annual list of America’s fastest-growing companies. The 2012 list put Dyn at number four among companies from New Hampshire, with its $17 million in annual revenue representing 271 percent growth over the previous year.
Much of that growth has come from acquisitions. “We have had a multimillion-dollar acquisition strategy that we’ve self-funded, and we continue to be acquisitive by nature, looking for opportunities to expand on our customer base, the talent we have and the technology we’re able to deliver,” Chynoweth said.
He said the Dyn expects to see 10 to 30 percent annual growth in employment at the Manchester location, hiring at the rate of 17 to 25 new employees per year.
The company benefited from an unanticipated marketing bonanza recently, when, on Sept. 10, thousands of websites serviced by DNS and hosting provider Go Daddy went down for most of the day. The Arizona-based firm is one of the biggest website hosts and the largest domain registrar.
Chynowether said Dyn saw a 300 percent increase in daily sales as Go Daddy customers scurried for a solution. “We don’t like to see the Internet break at any point,” he said, “but it was a tough day for Go Daddy when their service became unavailable. A lot of people turned to Dyn and said we are going to use you as our DNS provider, and we were happy about that, not just because we got new customers, but because it raised the awareness of the importance of DNS and its value on the Internet.”
DNS is invisible to most Internet users, operating in the background to convert host names or domain names into IP (Internet Protocol) addresses, which is how servers move traffic on the Web. Without DNS, Web users would have to type the numbers and dots that make up an IP address into their browsers to retrieve websites.
“We don’t operate the websites you go to, or the email you get,” Chynoweth said. “We just make them work better.”
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Dave Solomon may be reached at firstname.lastname@example.org.
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