Advice

A few days ago I acquired a great product-related domain name using Sedo. I saw the name at a good price, and I bought it after doing some due diligence, including a Whois History search and a quick search of the USPTO database. All of this came back without any problems, so I bought the name. As I’ve mentioned, I have been selling some domain names lately to pay off the cost of the Burbank.com acquisition, so I emailed a few clients and acquaintances offering this name for a good price.
Several hours after I sent the email, one of my acquaintances emailed me back with a listing from the USPTO. Unfortunately when I was searching for “this product” in the USPTO database, there were no listings; however, a search of “thisproduct” as a single word would have yielded the result. The product is similar to “Band Aids” in that other products in this category are often called “this product,” although it is less common than Band Aids, and the product has only been around for 5-6 years – about the same time as the industry. I emailed the original owner of the domain name (since 2003) and he told me

I was having a philosophical domain discussion last night about the future of the domain industry and where domain investors stand. This got me thinking about “my perfect domain portfolio” and my plans for the future. While we all tend to focus on the short-term, I think it’s important to think further out and set some long-term goals. I know this well help me stay focused on the bigger picture when dealing with present issues.
With that in mind, I would like to share what I think is “my perfect domain portfolio” in 5 years time. I cannot say whether this will still hold true in 5 years, but it is what I am visualizing at the moment.
I will have 2 fully developed city .com geographic domain names that are benefiting each community and the advertisers. I would like both domain names to be cities of between 100-150,000 people, as I believe a city of this size will benefit from a well-developed website. I think it would be much more difficult for a website to have an impact on a larger city, and as much as money is important, I believe a nice living can be made in the mid-size cities. I want to establish strong relationships in both cities, and I want each website to be well-received and beneficial to each city. I believe I have started this with my Lowell.com website, which is still being developed.
I will have 2 developed product/service based websites. They won’t necessarily be full businesses, but they will be in a niche that I find particularly interesting. Perhaps a wine or travel related website would be one of these. I hope this could be a fun website I will enjoy managing and be able to work on as more of a hobby than financial endeavor. Hopefully the geo-domain names will generate enough revenue to be able to do this without worrying about generating revenue on these pet projects!
I will have 15-20 domain names of friends and family. Some of my friends don’t really understand domain management, but they know they need (or will need) their domain names in the future. I am holding a few domain names for friends at the moment, and I imagine I will hold more in the next few years as friends get married or take on new challenges in life. For example, my brother is a law student, so I own a domain name that could be relevant to his law firm down the road.
I will want to own 10-20 speculative .com domain names. These are pure speculation that the topic would be of interest to someone or me down the road. These could all be names I keep in the hopper for my own development needs if I wish. They will all be in areas of interest, and I won’t be inclined to sell them.
As some people have seen, I have been selling names from my portfolio more quickly than usual. One reason I am selling them is because I acquired a large geographic domain name a few days ago (that I have been looking to acquire for over 2 months). This new name fits into my 5 year plan, and I need the funds to offset the high acquisition cost. A second reason I am selling is because I know I won’t ever get to develop the names. It’s not a matter of not wanting to develop them, but rather the time it would take.
The opportunity cost of keeping these domain names is greater than if I sell them and use the funds to pay for other expenses. Sure, I am probably getting much less than I could get down the road, but I know the funds I use from the proceeds of the sale will be more beneficial today to help position me to reach my goals in 5 years than they would be if I held on to them. As domain owners, we need to look at the costs of selling vs. the cost of not selling and see how that will affect our 5 year plan.

Rick Latona makes some good points about why domain owners should consider selling some of their domain names:

“I think that many domainers out there have only paper wealth. I’m not speaking of Frank who has both. A good deal of domainers are sitting on names that are worth a pretty penny but generate little income and they refuse to sell the name. I just don’t see the sense in that.“

When I was in college, I opted to not apply for financial aid, as my father’s business inventory would have been counted as assets, and we probably would have been denied. Unfortunately, we couldn’t pay for my college education with curtains, just like you can’t pay for a home or a car with a domain name. Sure, he could sell the curtains and pay for college with the proceeds, but if nobody is buying a particular type of curtain, it’s just worth its value on paper.
I am not telling you to go out and sell your domain names, but I have said before, the importance of having cash on hand is immeasurable. Check Rick’s Blog out when you get a chance.

I have seen many people selling the domain names of celebrities, athletes, politicians and other famous people. These people typically sell the names under the guise that they can be built into fan sites. Since fan sites may not generate revenue, it’s a form of expressing freedom of speech and protected under the First Amendment. While it may be true that owning a fan site on a domain name that uses the celebrity’s name is perfectly legal, by selling the name (or even buying it), the burden of bad faith may may be met, as the seller is profiting from the celebrity whose name made that domain name worth something.
If someone sells the domain name of a well-known person, they are presumably profiting from that person’s good name. By this virtue, bad faith may be claimed by the celebrity, putting the domain name in peril. As some WIPO panels have recently ruled, a change in ownership can be likened to a new registration. Because of this, buying the domain name of a famous person could be the precurser to a UDRP ruling.
Of course I am not an attorney, so this isn’t legal advice, but just my opinion and general domain advice.

I am going through a huge list of .org domain names, and I happen to be sitting here with my fiancee (well, she just left when I started blogging). The list of names I am looking at consists of a couple thousand .org names in every vertical, language, tense…etc. My fiancee saw a few good names that I would have bought in a second if they were .com, but I explained to her why I wouldn’t buy them in the .org extension. I am happy to blog about my thoughts as I have been asked before.
I believe .org is a good extension if the name makes sense to be in the .org. Since .org stands for organization, I believe the name should either make sense as an association of the term or as a group of that specific term. While .org doesn’t get as much play with commercial domain names, you can still make a commercial venture out of an organization.
Soccer.org would be a great domain name for a soccerl-related organization. If I owned it, I would build a directory of soccer clubs throughout the country. You could offer teaching tools, organizational tools or other enticements to sign up for the organization. I don’t think a name like Grapes.org would make sense as a .org, because it just doesn’t make sense as an organization.
As far as I know, almost anyone can own or develop any type of domain name, with the exception of .gov, .edu, and some country codes. However, we need to keep in mind that consumers expect certain things from certain extensions. If a consumer navigates to a .gov website, they expect to see something related to and managed by the government. If they navigate to a .edu website, they expect and educational website owned by a school or teaching institution. Likewise, they would expect the .org to be managed by an organization or association related to the actual term in the domain name. This can be a big advantage.