Chess.com's $55,000 Bankruptcy Buy That Became a $100 Million Empire
In the world of domain names, there are great buys, and then there are all-time legendary buys. Chess.com? That's in a category of its own.
The $55,000 Power Move
In 2005, Erik Allebest, an SEO expert and chess enthusiast, discovered that a company owning the domain chess.com was drowning in $5 million of debt and heading to bankruptcy. While the business was a disaster, the domain name was pure gold.
When chess.com went up for bankruptcy auction, Erik made his move. For just $55,000, he secured the domain—no business, no revenue, just the name. In today's domain market, that price seems absurdly low. But the auction wasn't even publicly known—no bidding wars, no hype, just Erik and a handful of people who even knew it was available.
The domain came with an unexpected advantage: browsers at the time would automatically direct users who typed "chess" into their address bar straight to Chess.com. No ads, no SEO, no marketing—just automatic traffic.
Building the Community
Erik's vision extended beyond owning a great domain. He initially planned to build a chess community—forums, profiles, and a social space for chess enthusiasts. Even before launching the full product, Chess.com was attracting 1,000 sign-ups per day without any advertising.
Users quickly demanded more than just discussions—they wanted to play chess. The team rushed to launch their first version of online chess in just two days. While basic, it was enough to kickstart the platform's transformation from a social network into the chess platform.
They added chess puzzles, lessons, and AI-powered game analysis. The site evolved from "the MySpace of chess" into the definitive online chess destination.
The Internet's Chess Boom
For over a decade, Chess.com grew steadily at 20-50% year-over-year. Then, from 2018 onwards, several events created a perfect storm:
- The World Chess Championship brought new audiences
- Chess exploded on Twitch with top streamers
- Netflix's "The Queen's Gambit" made chess culturally relevant
- COVID-19 lockdowns drove people to online activities
- The 2022 Magnus Carlsen vs. Hans Niemann cheating scandal created front-page news
By 2020, Chess.com was adding 400,000 users per day. The business grew 5x almost overnight.
Today's Empire
Chess.com is now a $100+ million per year business with over 150 million members and 100,000+ daily sign-ups. It's not just a platform—it's a media empire with live-streamed tournaments, chess influencers, and dominant content on YouTube and TikTok.
The Domain Advantage
Could Chess.com have been built on a different domain? Perhaps. But the one-word .com provided instant credibility, free organic traffic, and made Chess.com the default destination for online chess. Erik Allebest's $55,000 investment wasn't just buying a domain—it was securing a winning position from move one.
Checkmate.