There are many residents of Grand Cayman who have probably never heard of Frank Schilling nor of his Cayman-based companies, Uniregistry and DomainNameSales.
If they were to pass the youthful-looking 45-year-old entrepreneur at the post office or grocery story, see him in his usual workday clothes consisting of a T-shirt and jeans, it’s doubtful they would think he is as wealthy as he his; at least not until he got into his Ferrari and drove away.
Known as one of the world’s most successful Internet investors, Schilling has earned a fortune and created an Internet domain empire right here in the Cayman Islands through his vision, determination and hard work.
Never a great student – Schilling studied economics at the University of British Columbia but never graduated – he was smart enough to recognize that Internet domain names were like commodities in that they could be bought and sold for a profit, and at the same time like real estate, in that prime locations could demand high prices.
He entered the industry like many others – by buying domain names that were available, speculating they would appreciate in value.
“I bought one name. Then I bought another name. And then before I knew it, I had a thousand domain names,” he said.
Looking for a tax-neutral location from which to set up his business, he first established a company in the British Virgin Islands, but he wasn’t looking to live there. Instead, when he and his wife Michele decided to leave Vancouver for a warmer climate, and the post-9/11 U.S. wasn’t an easy place to emigrate to, Schilling chose the Cayman Islands.
Since late 2001, Grand Cayman has been his home and base of operations, even though it’s more expensive to operate here compared to other places in the world.
“I like it here, that’s why,” he said, noting that Cayman fits his personality.
A driven dreamer
Like his Ferrari, Schilling has a motor that can run at very high speeds and for long stretches.
He doesn’t spend a lot of time relaxing.
“I work weekends,” he said. “Fifty-two weeks a year, two days in the weekend, that’s an extra 104 days a year that I work. So I work 104 more days a year than the next man… 104 extra days will give you a lot.”
Even on vacation, he said, he will work two or three hours a day, even though it’s not as focused as it usually is.
Once a coffee drinker, Schilling now drinks six or seven cups of green tea every day; he said it makes him think more clearly.
His days are long and busy. He gets 600 or so emails a day, including spam, and he responds to between 200 and 250 of them.
“I like my mail unfiltered,” he said. “Spam even tells you something – you can learn from spam what’s happening and… what’s popular now.”
Schilling said he generally gets plenty of sleep, often nine or 10 hours a night, “but from the morning until the night, I go pretty much the whole time.”
He’s a multi-tasker who likes to get things done. Because of the proximity of essential services on Grand Cayman, Schilling can get a lot done here.
“I can… go get the mail, have lunch and run three other errands and still have time, whereas I could do one of those things on any given day in Los Angeles, because I’d be in traffic for an hour either way,” he said.
“I love how quickly I can get things done here.”
Schilling also likes the small-town feeling of Grand Cayman, even though it’s an international financial center.
“It’s like Busytown,” he said, referring to the fictional town in author Richard Scarry’s children’s books.
“It’s great because you’re driving down the road and it’s like, ‘Oh, there goes Mr. Turner, he’s on his way to the office; there goes Alan, he’s on his way to visit Frank.’ You recognize people in cars and you just know where they’re going by virtue of the fact that you know them and you know what they’re up to, or they told you at the pool. ‘There goes Bob, he’s doing exactly what he said he was going to do.’
There’s just something so cozy and quaint about that.”
Therein lies the paradox of Frank Schilling. He’s made millions in an industry that is replete with speculation, risk and uncertainty, but what he really likes is predictability. While Schilling can’t tame the social, economic and regulatory forces that drive the Internet, his predictability-loving traits foster good business decisions and well-considered risks.
Behind it all is desire to succeed, driven not by goals, but by dreams – very big dreams.
“I’m a dreamer. I dream about what I want to accomplish. I dream about what I want the business to look like.”
The Apple of his eye
Initially, the main focus of Schilling’s businesses was buying and selling domain names and monetizing the traffic coming to the domain names he owned.
“Then gradually, because our core business started to change, we decided to get into the services business,” he said. “We realized there was a great opportunity and [the industry was] ripe for disintermediation. There are a lot of terrible operators who were taking advantage… and there was no one else standing up to fill the void. So it was just so easy to become a services provider.”
Then came another opportunity based on what is known as generic top-level domains, which allow the familiar .com, .org and .net website name endings to be supplemented with extensions like .diet, .photo, .christmas and dot just-about-anything-else. That led Schilling to launch Uniregistry in 2012.
“Uniregistry has really been created on the back of a process run by a regulator,” he said.
“The regulator said, ‘OK, we’re going to have deregulation. We’re going to have [dot]anything name endings,’ which was unheard of in the past. So initially… the incumbents didn’t want it to happen. If you had .com and .net, the last thing you wanted is this world where .anything can exist, because that’s not good for your business. It’s in your best interest to say, “Let’s not do this. This is a bad idea. So after the years of shouting about this being a bad idea, it quieted down and everybody realized, this is coming, no matter what.”
Unlike his Cayman company DomainNameSales, Schilling’s vision of Uniregistry involved a host of products and services, the delivery of which would require staff. The process began in 2011 with his staff of three sharing office space with an architectural and interior design firm on the second floor of Governors Square.
Less than four years later, Uniregistry is undergoing its fifth office expansion and is now situated in all of the space previously occupied in Governors Square by Bon Vivant, the Prime Brazilian Steakhouse, Wine Down and the Wine Down Gourmet Market. His staff of three has ballooned to a staff of 47 in Cayman. Uniregistry has also now opened an office – and bought a building – in Newport Beach, California, bringing the total number of employees to around 70.
The company is thriving, partially because no one else is offering the products and services Uniregistry does.
“There are competitors that have some of the pieces, but they don’t have a true end-to-end offering and an owner operator like me who’s passionate and won’t compromise or cut corners,” he said.
Schilling’s dream is to create a business here in Cayman that “unlocks the value of domain names.”
“The names are confusing to use,” he said.
“People say: ‘It’s hard to use. It’s unwieldy. I don’t know what to do. I need a guide.’ So what we’re trying to do is build infrastructure that is elegant and executes by itself and does what you expect it do to and is intuitive and logical and simple.”
To unlock the value of domain names, Schilling said Uniregistry wants to couple the underlying truth that domain names are like unique pieces of real estate and take away the hard-to-use elements and make them more “Apple-like.”
“We want to be the Apple of domain names,” he said. “That’s what I tell everybody here in the office. We want to be elegant and intuitive and simple, with no up-sales – everything is included in the price of registration. That’s what we’re striving to do – we want to be the Apple of domain names. That’s my goal for this company, and I think it’s cool that I can live here in the Cayman Islands and start it from here.”
Uniregistry isn’t your typical Cayman Islands corporate office. The sprawling labyrinth of connected spaces, which incorporate many of the elements of the previous tenants such as Bon Vivant’s demonstration kitchen and Prime’s dining room tables pushed together to form a large conference table, have thousands of photo frames on the wall with pictures of staff members working or at various company events.
“That was my idea,” Schilling said. “I thought it would be cool because not everybody knows everybody and it’s nice to see people on and off work and not just at work.”
He’s said there are probably 5,000 photos on the wall already and that another 4,000 frames are on order.
While some of the staff have work stations, they drift around the office with their computers to work, sitting on a sofa, at the conference table with others, or, as Schilling said he often does, on the stool on the other side of the demonstration kitchen, a place he calls “my little stoop on the corner.” Hanging above his stool on a pipe is a necktie, the only one he owns. He said Governors Square developer Bobby Bodden gave him the Rotary Club-themed tie.
“He was taking me to meet the governor and he said I couldn’t meet the governor without a tie on, so he gave me this.”
When Uniregistry took the space previously occupied by Prime, it bought the kitchen equipment from the restaurant’s owners. That equipment is still there and is used by Chef Remy Azavedo, who prepares breakfast and lunch every day for the entire staff using only fresh meats and vegetables, mostly organic.
The company gives gym memberships to its staff and sponsors them to play in community sports leagues like tennis and softball. There’s also some gym equipment in the office, with showers.
Working hours for many of the staff are somewhat flexible, with some getting to work as early as 8 a.m. and other’s as late as 9:45 a.m., Schilling said.
“Some of the people who come in the latest, leave the earliest, but we’ll still find them online later, working on code,” he said. “A lot of [web] developers keep developer’s hours. They’ll work, but they’ll work after hours.”
When he hires people from on island – about a third of his staff is Caymanian – he says they can be a little “slack-jawed” when they see company’s work culture.
“But if they’re from the [San Francisco] Bay area, where Google is, this is very normal – a lot of this,” he said. “It’s normal for Facebook, LinkedIn, Yahoo…”
Schilling estimates that he spends about $700,000 a year on food for this staff, but he feels there’s a big return on that investment.
“Think about it,” he said. “Getting food is a huge distraction… if you lose everyone for an hour a day. Most people don’t want to take an hour for lunch – good people who love to work, they want to get back to work. They have an idea, a spark, they want to act on something, an idea they’ve had while they’re eating.
So this whole concept of, ‘I’m on my one-hour lunch break,’ we don’t want those people. They’re entitled to it, but we want people here because they have a curiosity, and a drive, and a desire, and want to make a difference in their lives.”
Schilling said he takes a far-sighted view at the food expense, looking at how far the company has progressed in just the past year.
“A year later, I have a registrar. I’ve got a much better registry. Everybody’s executing very well. The company’s running well. Could I have done that without lunches and breakfasts? Probably not. You kind of get a lot out of that. Hungry people make bad decisions.”
The perks also help retain staff, but probably not as much as Schilling’s philosophy for paying his well-performing staff members.
“Good people, we’ll remunerate them,” he said. “We don’t give 5 percent raises. If we get a developer who’s a superstar, we won’t think twice to give him a 30 percent raise overnight to take him to a totally different bracket, or even a 50 percent raise, if somebody really surprises us.”
In addition to good talent, Schilling said he looks to hire people who he thinks are a good cultural fit. He’s all about “moving the ship forward” and not letting the friction of ego get in the way.
“For a developer, it takes a lot for him to allow someone to say, ‘I see what you’ve done here; I don’t like it. Let’s tear it all down.’ Some developers lose their s..t and can’t take the criticism and get very defensive. Others are like, ‘hey, you know what, no problem, we’ll rewrite it, we’ll do it again.’ That’s a very big person, to say, ‘OK, I just want a better product.’”
Schilling said he thinks he has a little of Steve Jobs in him in that he tries to inspire, but he pushes to the point of discomfort sometimes.
“But do it in an inspiration way to try to show people we’re trying to build something better and greater.”
Another important part of the Uniregistry culture is the melting pot aspect of the office, which is very common in Cayman and something Schilling really likes about the country.
“Los Angeles is very similar, it’s melting pot,” he said. “There are black people, there are white people, there are Asians, there are people of mixed race – I think that is so very healthy. When you get a whole bunch of different races, race goes away because you’re just another person. I like that.”
Schilling has now been in Cayman long enough to earn permanent residence with a right to work. He doesn’t see he and his wife leaving.
“I don’t think, ‘oh, when I go back [to Canada]’… thoughts,” he said. “This is where ‘I’m back,’ for Michelle and me both. She likes it here, if that’s possible, more than I do and I like it immensely.”
With its most recent office expansion, Uniregistry has run out of office space to absorb, at least contiguously to its current space. Schilling owns land and has the money to build his own building, but he’s not sure he wants to do that. “The big problem we face is that you have a government here that is structured, predicated around legacy industries where you extract your pound of flesh,” he said, citing as an example of his point the movie that is shown at Pedro St. James.
“In the movie there’s this great line which really speaks to the history of the islands – there’s nothing wrong with it, it just speaks to the reality of the island – where the ship runs aground on East End and the local man rows his boat out and with one word of sympathy and two of business says ‘I’ll take [the ship’s valuables] to shore for you and help you get to shore.. for half. So culturally here in Cayman, and again, there’s nothing wrong with it, it’s just the way we are, a business starts up and government immediately historically pounces on it to try to get its… one word of sympathy and two of business.”
Uniregistry, as a startup company, doesn’t have profits yet and in fact is pumping $3 million to $4 million a year into research and development of products which may not make the company money, Shilling said.
“To the local government’s credit, they kind of see what we’re trying to do here and they’re trying to help us,” he said.
“We’re trying to take, for example, students from the university. We’re giving classes at the university to try to teach some of this stuff; we have five individuals here who are going, rotating, and speaking and lecturing at the university.”
The company is also taking on interns from the university, some of whom are hired full-time.
As long as the government doesn’t push Uniregistry away, Schilling will keep it here.
“We’ll prosper either way. Uniregistry will become a big company,” he said, noting that what the company does can be done here or in many other places, including California, where startup companies aren’t taxed.“I would like to be here and I like it here,” he said.
“The people are nice, there’s good Internet, but the challenge is making sure the government comes up with a more equitable fee structure to allow startup companies to prosper because of… the spin-off benefits. You need a government that is far-sighted enough, that has more of a Dubai mentality and less of a ‘let’s take half to bring you ashore.’
I’m over-simplifying by making those comments, it’s not half, clearly, and government, to be fair, has been very supportive today, but the risk is somebody will get their nose out of joint, some local business will feel like, ‘how come I can’t have what they’re having’ and then it will change things up.”