I was negotiating a domain sale with an end user buyer a couple of weeks ago, and when it came time to discuss payment, he mentioned a potential hardship in paying the full amount at one time. I didn’t want to lose this sale, so I mentioned that there are financing alternatives since banks don’t generally lend to purchase domain names.

In order to close the deal, I arranged an introduction to Domain Capital, and fortunately, the buyer and Domain Capital were able to come to terms, and the deal closed yesterday. When I think of Domain Capital, I generally think of domain investors and others with domain industry connections who use the company as a means of financing an acquisition or getting liquidity for domain names they own. I am glad I thought of them when I was dealing with this end user buyer.

Of course, there are other financing alternatives to consider (a couple of which I considered), although two of these are not really “financing” per se. You might consider these options when closing a deal with an end user, even if it’s not mentioned. I would imagine some people wouldn’t discuss a payment hardship, so unless you suggest the financing options, they might balk at paying your asking price.

Here are a few domain financing options:

• Domain Capital – I mentioned it above.

• Self financing – Offer the buyer the option to pay with a payment plan and keep the name until payment is made in full. It’s the least expensive option but it can get hairy if something goes wrong. Be sure to have a solid contract with the buyer and don’t risk this on a valuable name.

• Escrow.com payment plan – It’s not cheap, but it may make a buyer more comfortable to have the name held in escrow while payments are made. You can also step away from the transaction and let them collect your payment on your behalf. Escrow.com offers this on deals valued at $75,000 or higher.

• Attorney escrow – Work with an attorney like John Berryhill (who I know offers this on some transactions). You can work out the legal agreement and his firm will hold the domain name in escrow while payments are being made.

We all get emails from people who don’t use their full name or don’t provide enough information for us to identify who the buyer is. Although you may not necessarily price a domain name based on who is buying it (many people do, some don’t care and have a set price no matter who is inquiring), it is wise to at least see who is inquiring or making an offer on one of your assets.

The first thing I generally do is to search Google for the person’s name and email address to see if I can pinpoint who they are. Although some people disguise their identities, I have found that most serious buyers that inquire about my names don’t generally do this. Perhaps it’s because I don’t generally passively await offers for most of my higher end names, but that’s what I have found.

One trick I use to find out the identity of a buyer is to search Facebook for the person’s email address. If the email address is connected to a Facebook account, that account will be listed. Although many people keep their information private, you can almost always see the person’s real name, and you can often see where the person is from and possibly what they do.

This information should help you identify the potential buyer, and you can try to learn why they want a particular domain name. You can use this information to either price your domain name or negotiate with them accordingly (if they have a trademark for example).

Thanks to NameBio for sharing this tip with me a while ago.

If you own a “category killer” domain name, chances are good that there’s one or more trade organizations that represent companies and people that “do” what your domain name means or sell the product that is your domain name. Many of these organizations offer email blasts for advertisers, and this could be a good way to sell a domain name.

I exchanged emails with one trade organization yesterday, which has somewhere around 25,000 member email addresses. The group is willing to do an advertising email blast to its membership for $3,000, and it also offers to feature the advertiser in its monthly bulletin at no additional cost.

While spending $3,000 to sell a domain name is a LOT of money and something I wouldn’t do unless absolutely confident in selling it, putting the name in front of 25,000 prospects is a huge opportunity, especially if the name encompasses an entire industry. I don’t know if each email address is associated with separate companies or if some companies have many members in the organization, but that’s a lot of potential buyers.

There are a few things you might want to ask before moving forward with something like this:

• Email open rates
• # of individual companies represented in the email list
• References from previous advertisers to request feedback
• Discount off the rack rate

You might want to ask about is whether the organization would do the email blast for free in exchange for a percentage of the sale if you sell the domain name. If you sell a $50,000 domain name, they could make $5,000 with a 10% commission vs. $3,000 for the email blast cost. Of course, it costs you more in the end if you sell the name, but you don’t have to pay the money up front. You can also factor the commission into your asking price.

One other thing you might want to do is ask the trade group if they will write the email to its members so it has more authority than if you were to write the pitch yourself. Having a trade organization’s CEO telling its members that your domain name is a great deal will be more  authoritative  than your doing it yourself.

I’ve probably mentioned this tip before, but even if I did, I think it’s value is well worth another post.

When you acquire or own a category defining keyword domain name that you want to sell, you should do a Google search for that domain name and have a look at all of the companies that use your domain name as a part of their url. Many of those companies may wish to either shorten their url or “own the keyword” domain name for the authority that it brings.

I’ll give you an example to show you precisely what I mean.

Let’s say you own BikeTours.com and want to sell it. I’d visit Google and do a search for the term “BikeTours.com.” Notice that I added quotes around the domain name to make sure the results are most accurate. After performing that search, I see that the following companies use BikeTours.com in their domain names:

• Bike-Tours.com
• BikeTours.com.au
• Tuscany-BikeTours.com
• FatTireBikeTours.com
• CTBikeTours.com
• BikeTours.com.ar
• BogotaBikeTours.com
• PedalBikeTours.com

There seems to be dozens of companies and websites that use the term in their url, and I would bet most would want to own the descriptive BikeTours.com domain name if they could. I’ve used this method to sell domain names before, and it could help you, too.