# EIG acquires Arvixe, LLC Assets



## XFS_Duke (Nov 4, 2014)

As per the link here describes, it seems as though EIG bought out Arvixe, LLC.


http://ir.endurance.com/releasedetail.cfm?ReleaseID=880160


People on WHT are going crazy too. It was confirmed to me by an employee of Arvixe. As I used to work there and have a grudge, I thought it was funny.


What y'all think about all the EIG buyouts?


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## Shoaib_A (Nov 4, 2014)

Another one gets flushed down the EIG toilet 

Arvixe is also gonna become like HostGator, BlueHost etc with downtimes, worst support, issues everywhere.


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## Francisco (Nov 4, 2014)

I wondering if EIG will pick up any VPS brands?

So far it seems to be mostly shared.


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## DomainBop (Nov 4, 2014)

my only contribution to this thread (the rapidly rising S,G&A expenses, interest expenses, and net losses are my favorite parts) http://www.nasdaq.com/symbol/eigi/financials?query=income-statement


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## MannDude (Nov 4, 2014)

Regardless if you think EIG is the devil or not, this is the nature of the industry. They are probably the largest holder of the shared hosting market share.



> Companies under EIG
> 
> 
> 2slick.com[10]
> ...


Most of those companies are not ma-and-pa shops or ran by a few teens with time after school, they're big. I worked for Arvixe years ago and at the time they had about 3X,XXX customers and a few dozen full time staff... give or take. That's nothing to sneeze at. A very talented work force and like most older companies, are ran by people with great skill. I know Arvand and his brother did a lot of coding/developing work believe as well.

My main issue is how these are never publicly announced. I'd imagine when they buy you out they request silence on your part about the acquisition. This was only found out as someone was reading their quarterly finance report and noted the acquisition.

Love em' or hate em', EIG isn't going anywhere. They became a publicly traded company back in 2013 ( http://finance.yahoo.com/echarts?s=EIGI+Interactive#%7B%22range%22%3A%22max%22%2C%22scale%22%3A%22linear%22%7D ) and from the people I know who work or have worked for them under one brand or another, they don't seem like a bad place to _work_. (Real employee status, not this 1099 contract worker stuff that plagues the industry, health care and benefits, paid to volunteer in your local community on time off, etc)

They buy you out by giving you more money than your company is probably worth because they can and know that's the only way to get people to let go of things they've worked on for years to build. Every man has his price, the list above is a collection of companies ran by people who found theirs.


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## InertiaNetworks-John (Nov 4, 2014)

That's a shame they got acquired. But as @MannDude said, every man has their price.


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## drmike (Nov 4, 2014)

Consolidation happens in this industry. Hell it's happening in ugly way in all traditional industries too as the economy sputters.

Since vast majority (if not all) of these acquisitions were of private companies, the money is elusive illusion and not going to be forthcoming on the biz recipe.

Arvixe was a company I fondly joked that half of the productive folks in the bargain sector worked at, at some point.

Arvixe by our terms here wasn't ever price wise a discount brand.   Even cursory look at their lowest shared hosting plan with all the unlimited 'garbagio' smacks you today at $96.

Like every other shared-hosting focused brand it is all about those big fat pay ahead annuals.  Every customer through the door = $100 plus whatever you can upsell them on (domains, SSL, etc.)

The stealth shut your mouth deals are simple.  They are there to prevent mass brand defection.  People get irked, but are all ADD.  Attention span of caring is three billing periods and if things don't catch on fire or go down as often as ColoCrossing brand then 85%+/- keep their butts in the same chairs.   Cause folks are lazy.

EIG is big venture / fund money.   More money than sense.

The buyouts, great for the ownership getting out with their golden parachute.  Unsure how it proves for the working folks that keep these companies running.

All said, non 1099 real employee status, vacation time you actually can use cause they have other staff while you relax, 401(k), etc.  these are things blue collar fought for and received many many decades ago.  Tech continues to be blah and an outsourced sweatshop mind thriller.   Slavery was outlawed, but involuntary self-enslavement is contractually just fine by law and obviously in practice.

More consolidation is going to happen and I guarantee we'll see brands folding outright.  Overdue as really, I don't see any of these companies growing tech necessity and creating a reason for people to have multiple hosting packages they pay for at any cost.


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## XFS_Duke (Nov 4, 2014)

I worked for Arvixe for a while a few years ago as well. We have well over 30k customers and when I had access to billing, they made some money. I know they used, from what I was told, their own custom billing system named rosewill and it worked great. They were supposed to build it into a stand-alone system that they could lease out. Guess that never panned out.

Arvixe was great. Hope they don't just slack right away. Too bad for all the 1099'rs that will be looking for future work as from my understanding, EIG doesn't use remote techs... Maybe someone else can confirm or deny that, but when I applied and got my interview with HostGator I would of had to move to Houston.


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## Francisco (Nov 4, 2014)

Looks to be confirmed:



> Hi WHT,
> 
> Arvixe has joined EIG. Our goal has always been to provide quality service/support and we will continue to do so as part of the EIG brand as we have done the past 11 years. Our management team is working with EIG to make sure integration is as seamless as possible. Thank you for understanding.
> 
> Regards.


http://www.webhostingtalk.com/showpost.php?p=9282874&postcount=56

Francisco


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## bullfrog3459 (Nov 4, 2014)

Oh you know...EIGI has posted adjusted income from Q1 to Q3 at a cool $472 Million. Projected to have $165M for Q4 for a nice total of $637M for the year. Not bad....only a small bank roll.


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## wlanboy (Nov 5, 2014)

Jup merges are starting all over the tech companies.

Look at Silicon Valley - the landlords now require new companies to pay the rent for the whole year up-front.

Because they don't know if these companies can pay the rents on the long term.

Maybe some old big corps don't have your personal fan status but they do something right - they do have the money to buy companies the owners don't have any faith in.


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## DomainBop (Nov 5, 2014)

EIG also bought BuyDomains and website building tool Webzai in addition to Arvixe.  The combined purchase price for the 3 companies was $77 million.

http://www.bizjournals.com/boston/blog/techflash/2014/11/endurance-acquires-waltham-based-buydomains-two.html


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## XFS_Duke (Nov 5, 2014)

It's funny how the Arvixe QA staff posts on WHT and says that they're working with EIG. Unfortunately the world knows what will happen. Arvixe's main staff will be kept on for a while and all other staff will be removed. Just like HostGator and the rest of their buyout companies. It's sad, the long list of companies that were bought out by them had pretty good track records. Only to let the money get in the way. I personally, don't care about how much one company can offer me for my company, my customers and reputation come first. It saddens me. I do remember Arvand saying he wouldn't sell his company to anyone. Heh... Look at it now, first the WebEasy stuff and now this.


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## trewq (Nov 5, 2014)

XFS_Duke said:


> I do remember Arvand saying he wouldn't sell his company to anyone. Heh... Look at it now, first the WebEasy stuff and now this.


Everyone has their price. If someone is willing to payout your pride then he'll, why wouldn't you?


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## Nick_A (Nov 5, 2014)

I didn't realize EIG bought out ASO. That's quite a list.


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## zafouhar (Nov 5, 2014)

Well i saw this coming at least since April/May 2014, its interesting though as there isn't yet any public announcement regarding this acquisition.


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## drmike (Nov 5, 2014)

Waiting for the inflow of all those Arvixe workers who now are looking at pink slips.

Certain to see old, friendly faces visiting us here and elsewhere in coming weeks.

As for the combo dealing, $70+ million.  Hard to do a teardown on what was sold here and values.

Arvixe should have been $5-10 million - but hard to say without better info.  Sad if the owner said he'd never sell and obviously just did.

I'm f'n blah about Arvixe and their "24X7 U.S. PHONE SUPPORT" ... Says that at the very top of their homepage.

US folks allegedly on phones, and all those Indians are doing what?  Tickets?  Seems damn deceptive.   

Is this fake US support common among EIG companies?  Others aware of the practice in other EIG owned companies?


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## drmike (Nov 5, 2014)

Word has it that Arvixe seemed to still be renting servers.  Meaning their per server starting monthly nut to cover was much higher.  Softlayer was/is one of the providers.

EIG is supposedly migrating Arvixe to colocated and owned servers.


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## XFS_Duke (Nov 5, 2014)

drmike said:


> Waiting for the inflow of all those Arvixe workers who now are looking at pink slips.
> 
> Certain to see old, friendly faces visiting us here and elsewhere in coming weeks.
> 
> ...


To be honest, mostly all of the Phone reps are from the US originally. There was like 1 or 2 Indians that live in the US that worked phones. Most of their foreign workers do Chat and Tickets. I personally did all when I was there... Phone, chat and tickets. I also did SSL installs and VPS/Dedicated Server setups.


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## drmike (Nov 5, 2014)

Yeah 24x7 phone support is to give idea that support is USA based.  It's not about the phones.

They don't elsewhere or nearly as prominently proclaim:

"24x7 ticket support (and other forms) provided by non USA based".

I mean it's partially telling the truth, but bet your bottom dollar, it's wrote that way to be deceptive.

I remain AMAZED at the adoption of foreign workers in this industry and how "embarrassed" everyone is of such.  

I mean I have yet to see anyone say:

*"We are able to offer low prices to you, our customer, because we leverage the economy of employing workers in poverty stricken, low-per-capita earning nations.  By not paying USA workers (or others major industrialized nations) we can slash our prices"*

Companies engaging in such should just be embarrassed of themselves.  I am sure their parents decades ago wouldn't have appreciated such marketing / sales distortions and certainly wouldn't have smiled about the whole labor force gimmick.


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## XFS_Duke (Nov 5, 2014)

drmike said:


> Yeah 24x7 phone support is to give idea that support is USA based.  It's not about the phones.
> 
> They don't elsewhere or nearly as prominently proclaim:
> 
> ...


LOL yea. But one thing about Arvixe, they paid everyone pretty good. I cannot say that everyone got paid the same, or even remotely the same but most of the foreign workers got paid pretty good under a 1099. I know a few that got $9/hour plus. I made a good bit more than that, but taxes at the end of the year KILLED me. I really enjoyed working there, but once one of their "management" guys told me they didn't care about my daughter and her speech therapy even though it was approved by my manager at the time, I knew I couldn't stay there any longer. My daughters health and hearing was more important to me than dealing with them. Sad thing, they called me on my day off and told me I was supposed to be working and then let me go because I couldn't jump on right away since I was about an hour away fishing. Lovely, right?


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## drmike (Nov 5, 2014)

@XFS_Duke
 
Workers rights and human dignity continues to challenge masses of "employers". Shame to hear management say they don't care about your children like that.  Some will say two sides to every story, me I tend to say that is how companies operate.  Folks should know how companies operate and where their interests are.

Unsure what they paid and believe me if I catch wind of companies gouging labor and playing offshore false advertising games I'll blow the whistle.  Someone needs to.  Lack of journalism in this industry and what exists might as well be corporate advertising/marketing/PR department for these companies.

This is the issue when the whole business model is basically paid advertising.  Always was in traditional media and continues with online whoring-for-ad-dollars.

Start naming industry publications and sites with any teeth and remote chance they have properly bit anyone lately.  Anyone can name one?


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## DomainBop (Nov 5, 2014)

drmike said:


> As for the combo dealing, $70+ million.  Hard to do a teardown on what was sold here and values.
> 
> Arvixe should have been $5-10 million - but hard to say without better info.  Sad if the owner said he'd never sell and obviously just did.


It's probably safe to say the majority of that $77 million combined went towards the purchase of BuyDomains (which  owns over 1 million domain names --> good fit with EIG which is now the 2nd largest domain registrar after its acquisition of BigRock/ResellerClub early this year).  It's also probably safe to say that the VC company that controls NameMedia took a loss on BuyDomains when they sold it to EIG because they paid $72.5 million plus stock for BD when they acquired it in 2005.


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## rds100 (Nov 5, 2014)

Why would a domain registrar with 1 million domains be worth $70 million? This makes what, 7 years turnaround from 1 million $10/year domains? Makes zero sense to me.


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## DomainBop (Nov 5, 2014)

rds100 said:


> Why would a domain registrar with 1 million domains be worth $70 million? This makes what, 7 years turnaround from 1 million $10/year domains? Makes zero sense to me.


BuyDomains isn't a domain registrar.  They make their money buying and selling premium domains and generally won't buy any domain that they can't resell for at least $1K   They own those domains.   They typically buy domains at auction or acquire domain portfolios (their average acquisition price for the domains they own was $80+) and then turn around and sell them (their average sales price is $1200-$1500).  $1500-$80=nice profit on each domain sold.  Estimated revenues per year around $20 million and profits of $10-$12 million.

edited to add a link: http://domainnamewire.com/2014/11/04/endurance-buydomains/


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## rds100 (Nov 6, 2014)

So is it expected that Arvixe would get better now, or worse? Because we keep getting UDP floods from some of their IPs.

Although i haven't bothered contacting them about it and just filter it, i hoped they would monitor their traffic and take measures to not allow their servers to be used as a DoS source.


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## Epidrive (Nov 6, 2014)

Suprised by the list of EIG companies -- thats a lot :O


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## QuadraNet.Dustin (Nov 6, 2014)

XFS_Duke said:


> LOL yea. But one thing about Arvixe, they paid everyone pretty good. I cannot say that everyone got paid the same, or even remotely the same but most of the foreign workers got paid pretty good under a 1099. I know a few that got $9/hour plus. I made a good bit more than that, but taxes at the end of the year KILLED me. I really enjoyed working there, but once one of their "management" guys told me they didn't care about my daughter and her speech therapy even though it was approved by my manager at the time, I knew I couldn't stay there any longer. My daughters health and hearing was more important to me than dealing with them. Sad thing, they called me on my day off and told me I was supposed to be working and then let me go because I couldn't jump on right away since I was about an hour away fishing. Lovely, right?


Brian mentioned you both were given the boot because Arvixe found out about Xfuse.


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## XFS_Duke (Nov 6, 2014)

QuadraNet.Dustin said:


> Brian mentioned you both were given the boot because Arvixe found out about Xfuse.


No, Brian got the boot because of that. I got the boot so to speak from what I said. I did a lot for them at the time and every Tuesday at around 11am CST I needed to be off of phones for an hour to allow my daughters speech therapist to come in and help her. She had ear issues when she was a baby and it affected her speech progression. I got it approved by the manager at the time and it was a recurring thing. It was every week at the same time. Long story short, Kevin Hall got mad cause he actually had to work and answer phones one day and was mad about that. The next Monday I was off of work and decided to go fishing. I checked my tickets before I left and didn't have many so I didn't think it was an issue, most were just replies to setup emails and such. Eh, so I get out to the fishing spot and about 10:30am or so I get a call about why my tickets aren't done... I said they're only replies to setup emails and stuff, nothing big. Well, apparently we had a bunch of orders that day and I didn't know since the tickets were pushed to be AFTER I left. Keep in mind, my off days were Monday and Friday... I told him I was going home now and will get them done, but on the clock, obviously. I got home and Kevin Hall started bitching at me over Skype and brought up the issue of me getting off the phones for an hour. He told me he didn't care about my childs needs and that Arvixe comes first. I told him that my kids come first to me because they'll be there for my entire life, Arvixe may not be. I can't remember the exact conversation, but it turned out that he said he could do my job better and he told me if I didn't want to abide by his rules I can go, so I got gone. I told Arvand about the situation and he didn't care and pretty much resonated the same thing about my kids. I told them none of them have kids and have NO clue what is needed to be a parent of a sick kid. Needless to say, I liked the job, just couldn't handle the bitching from a douchebag who couldn't even do his own job properly and instead of communicating with his managers decided to jump to conclusions. Funny thing, I was a shift manager on Saturdays and Sundays in the AM shift and dealt with all the chat, phone and ticket staff... Oh, didn't get paid more for that either lol


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## Alex - Arvixe (Nov 6, 2014)

rds100 said:


> we keep getting UDP floods from some of their IPs.
> 
> Although i haven't bothered contacting them about it and just filter it, i hoped they would monitor their traffic and take measures to not allow their servers to be used as a DoS source.


Hello rds100,
If you reach out to us we can investigate this and resolve it as quickly as possible. Can you email abuse[at]arvixe.com or myself personally at [email protected]arvixe.com with the relevant details?


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## Dylan (Nov 6, 2014)

MannDude said:


> Regardless if you think EIG is the devil or not, this is the nature of the industry. They are probably the largest holder of the shared hosting market share.


They're definitely big, but GoDaddy's bigger:

Hosting market share in the Alexa top 1M:

GoDaddy+MediaTemple 39,952

Unified Layer+Endurance International Group+HostGator 37,942

 

Full rankings:

http://www.datanyze.com/market-share/hosting/


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## wirenine (Nov 6, 2014)

Dylan said:


> They're definitely big, but GoDaddy's bigger:
> 
> Hosting market share in the Alexa top 1M:
> 
> ...


EIG is rapidly growing.


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## DomainBop (Nov 7, 2014)

Dylan said:


> Hosting market share in the Alexa top 1M:


The Alexa top 1M probably doesn't paint an accurate picture of the size (number of websites hosted, customer base) because the top 1 million represent just a tiny fraction of the total number of websites, and the percentage of websites in the top 1 million who use overloaded "unlimited" shared hosting, which is EIG's bread  and butter, is lower than the overall percentage of websites that use shared hosting.

If you extend it out to the top 5 million websites, then according to this survey EIG brands  would rank #2 (HostGator), #3 BlueHost, and #21 ("EIG") http://myip.ms/info/top_hosting/TOP35_World_Website_Hosting_Companies_2014_year_Real_Time_Statistics.html

If you include all websites, then Digital Ocean is now the 4th largest hosting company in the world according to Netcraft


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## drmike (Nov 9, 2014)

So, someone did kindly by me....

Pointed me to the public filing since EIG is required to file public disclosures:

*"On October 31, 2014, the Company acquired Arvixe, a California-based web presence provider to small and medium-sized businesses for a purchase price of $22.0 million, which consisted of a cash payment of $17.6 million at the closing with the remainder payable 12 months following the closing."*

^--- There you are.  Arvixe sold for $22 million.


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## drmike (Nov 9, 2014)

With regard to speculation about employees and concerns for job loss and offshoring:



> As we acquire other businesses,* we regularly combine data center, sales and marketing, support and engineering operations and the general and administrative function to better leverage our cost structure by eliminating redundant cost*s. In order to remove these costs, we may incur charges for employee severance, exiting facilities and restructuring data center commitments and other related costs. *During the three months ended September 30, 2014, we completed the process of closing office locations in California and Colorado. These office closings resulted in the elimination of approximately 90 positions*, for which we have taken severance charges of $1.8 million, which was incurred during the nine months ended September 30, 2014. We have paid $0.6 million of severance costs during the nine months ended September 30, 2014 and accrued a severance liability of $1.1 million as of September 30, 2014 related to these severance costs. We expect the employee-related charges to be completed during the year ended December 31, 2014. We may incur additional severance costs related to these restructuring activities during the three months ended December 31, 2014. We do not, however expect any additional severance costs to be material to our financial position and results of operations. We have approximately $3.0 million in remaining lease obligations for these closed facilities and have recorded a charge for remaining lease payments, net of expected sublease income, of $1.6 million during the third quarter of 2014.


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## drmike (Nov 9, 2014)

Full filing loaded with other deal money details and similar:

http://www.sec.gov/Archives/edgar/data/1237746/000119312514402080/d799788d10q.htm


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## XFS_Duke (Nov 10, 2014)

Sad thing is the person from Arvixe doesn't even reply to this stuff... Sad day for sure... I'm glad I'm not a customer anymore. If I was, I would certainly move.


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## XFS_Duke (Nov 10, 2014)

@Alex - Arvixe any ideas behind this? Don't mean to throw you guys under the bus, but aren't you worried about your job in the next several months?


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## zzrok (Nov 10, 2014)

XFS_Duke said:


> @Alex - Arvixe any ideas behind this? Don't mean to throw you guys under the bus, but aren't you worried about your job in the next several months?


He probably is worried, which is why he doesn't want to say or do anything that would paint a target on his back.


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## QuadraNet_Adam (Nov 11, 2014)

Interesting read: http://www.thewhir.com/blog/endurance-international-group-acquires-arvixe-look-numbers



XFS_Duke said:


> @Alex - Arvixe any ideas behind this? Don't mean to throw you guys under the bus, but aren't you worried about your job in the next several months?


Duke, that is none of your concern. Just because Arvixe let you go doesn't mean you have to give everyone a hard time about it and try to make everyone feel sorry for you (quite evident what you are trying to do from your previous posts). Move on, and tend to your own knitting.


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## Aldryic C'boas (Nov 11, 2014)

Glass Houses.


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## DomainBop (Nov 11, 2014)

QuadraNet_Adam said:


> . Move on, and tend to your own knitting.


While studies have shown that solitary knitting activities have therapeutic value, research has also shown that group knitting provides an individual with even more therapeutic and psychological benefits.



> Knitting in a group was also reported to improve social conﬁdence and feelings of belonging. For the people with depression, there was     a signiﬁcant    association    between membership of a knitting group and feeling happier and better about themselves


 reference: http://www.academia.edu/7004566/Knitting_and_Well-being.


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## drmike (Nov 12, 2014)

TheWHIR has a write up on the Arvixe deal.  It's wrote by Tom Millitzer of Millitzer Capital:

http://www.thewhir.com/blog/endurance-international-group-acquires-arvixe-look-numbers


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## Sam (Nov 12, 2014)

Arvixe is the only shared host I am currently using because I love their reliable fast servers and great support. Let's see if the same service quality continues.


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## RosenHost (Nov 12, 2014)

This EIG really is like a huge monster. I wonder who is up next


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## MannDude (Nov 13, 2014)

Actually I still actively use my Arvixe shared hosting from years ago. It works and I've just been too lazy to switch it elsewhere for that particular no-traffic site.


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