Domain Investing is Not a Way to “Get Rich Quickly”

Elliot Silver
-
23

I hate to burst anyone’s bubble who thinks otherwise, but I don’t think there is any “get rich quick” strategy for domain investing, and also don’t think there are any fail proof ways to make money from domain names. There is significant risk in domain investing, and it is not unlike other types of investing (real estate, commodities, stocks…etc).

There are quite a few people who make a living with their domain investments. Many of these people make a very good living. I wouldn’t even venture a guess about how many people make their full time living investing in domain names.

One of the things that most of the people who make a living from domain investments have in common is that they have been in this business for many years. This longevity gives them considerable knowledge about operating a successful domain investment business. In my opinion, the most important aspects of managing a domain investment business are:

  • Knowing the resale market
  • Knowing how to stay informed of market changes and domain name ownership changes
  • Knowing how to get in touch with domain owners and prospective buyers
  • Knowing how to negotiate
  • Knowing when the time is right to sell a domain name
  • Knowing when the time is right to buy a domain name
  • Knowing where to buy domain names
  • Knowing who to ask questions of and knowing the right questions to ask
  • Knowing how to monetize domain names
  • Knowing how to mitigate legal risk

I don’t think there is any way to become an expert at all of these aspects of the business without actually being immersed in the business for a long time. It is easy to spend a lot of money buying domain names, but it is not nearly as easy to sell those domain names profitably.

Plenty of people made money by selling one domain name or a handful of domain names.  However, one great domain name sale does not make a business.  There have also been plenty of people with grandiose dreams of making silly amounts of money, and they have left with those dreams unrealized.

Like any other types of investing, there are people who have done well and there are people who have lost their investments.

Close Out Old Sales

Elliot Silver
-
4

A few days ago, I listed SSSN.com and PRRR.com for sale via Embrace.com. Unfortunately, the domain names were not sold, and I am happy to continue holding them until a buyer is willing to pay my asking prices. One important thing I did this morning was delete the sale post on Embrace.com. I think people should remember this step when conducting a sale.

I set up the sale page with buy it now links from Escrow.com. I think they make buy it now listings easier for buyers to execute quickly. The one downside is that I don’t think you can set up an expiry period for these links. For instance, if I list a domain name for sale for $5,000 today, someone could theoretically use the link to set up a transaction in 10 years from now. With the crazy market values of some domain names, it would be problematic if I give someone the ability to buy a name in the future at today’s prices.

When you use buy it now pricing on domain names,

Read More

Get a Referral From the CEO

Elliot Silver
-
0

A couple of years ago, I reached out to a business colleague when I was looking to sell a domain name. He gave me the contact information of  a friend of his who is CEO of a medium-sized company (LinkedIn says 51-200 employees) that we both  thought might be interested in the domain name.

When I reached out to the CEO, I assumed he wouldn’t be the best person to ask about the domain name. Instead, I asked him if I could contact the person who manages  the company marketing to discuss the domain name opportunity. He said that would be a good idea, and he provided the employee’s email address and phone number. I then emailed the Director of Marketing at the company, making sure to mention that the CEO referred  me to him to discuss the domain name. The company ended up buying the domain name from my company.

I am not sure how much

Read More

Tip: Email the Old Whois Email Address

Elliot Silver
-
0

I have been looking into buying a domain name, and I opened a discussion with the owner via the current Whois email address. One thing I noticed is that a year or two ago, the email address changed while the other Whois information remained the same. On very rare occasions, this can be indicative of a domain theft where a thief controls the new email address unbeknownst to the real owner.

One way that I like to do due diligence is to send an email to the old email address found via DomainTools Historical Whois search. Typically, I will send a short email to the old email address confirming that the current email address is accurate and that the rightful domain owner is aware of the email discussion.

If I don’t receive a reply confirming this, I would

Read More

Counterparty Needs to Have Authority

Elliot Silver
-
14

I have bought and sold quite a few domain names to larger companies with multiple levels of decision makers. In these dealings, I have negotiated with a variety of individuals at different positions within the companies. One thing that should be discussed is whether the other party has the authority to negotiate terms and agree to a deal.

I have discussed deals with everyone from marketing managers to lawyers to executives. Generally speaking, I assume that the other party is authorized to discuss a deal because they either contacted me to discuss a domain name or they were the point of contact for me. As a negotiation gets going a bit, you should think about asking the other party if they have the authority to do a deal with you.

The primary reason for learning this information is that you don’t want to reach a deal with the other party only to learn that someone else has the power to cancel the deal. It can be a major time waste if you negotiate a price and terms only to learn that there are other people that need to get involved before the deal can be finalized. It is pretty

Read More

Be Mindful of Legal Risk

Elliot Silver
-
2

One of the considerations domain investors need to make when buying a domain name is the legal risk. For some domain names such as clear trademark typos, the risk is obvious and great. For others such as keyword and short acronym domain names, the risk is lower.

Regardless of the type of domain name that is owned, I think there is always some level of legal risk, and domain investors need to consider the legal risk before making a domain name purchase. They also need to consider the legal risk before making use of their domain name, as the usage could be cause problems.

Even if the chance of success is low, companies can file a UDRP pretty easily and at a relatively

Read More
1...525354...212Page 53 of 212