Domain Sales

Good Time to Use Godaddy for New Domain Registrations

Godaddy LogoAlthough I have pretty much consolidated my domain portfolio at Moniker, I still use Godaddy from time to time when I buy newly registered domain names. I want to share an example of when and why I believe it’s smart to use Godaddy for new domain registrations.

On occasion, I buy hand registered domain names with the hopes of quickly re-selling them to other companies or domain investors. When domain names are newly registered, they aren’t able to be transferred out of the registrar until 60 days after registration due to ICANN policy.

Godaddy is the largest domain registrar by far with tens of millions of domain registrations under their control. Many businesses use Godaddy, and many domain investors also have accounts at Godaddy. If a company doesn’t have an account at Godaddy, it’s more likely they will have heard of Godaddy than another registrar (except maybe Register.com and Network Solutions).

When you make a sale of a newly registered domain name, it’s much easier to push it to another Godaddy account (which most people have) rather than having to explain that it can’t be transferred out from another registrar. Telling someone that a domain name that they are buying for $2,000 was registered in the last 60 days may be a deal breaker.

Using Godaddy to register new domain names can make a sale go more smoothly, and that’s a reason why I use them.

Yahoo Sells MusicVideos.com, LookUp.com, and FreeComputers.com to True Magic

Yahoo!In a $250,000 deal that took place on Sedo last week, Yahoo sold the domain name MusicVideos.com to Merlin Kauffman’s True Magic, LLC. According to some analytics that I have seen, MusicVideos.com gets considerable traffic – nearly 1,000 unique visitors a day according to Compete, despite the fact that it hasn’t been promoted in quite some time. In the week since acquiring the domain name, Kauffman’s company already completed another deal and re-sold it.

True Magic also recently bought LookUp.com from Yahoo for $17,500 and FreeComputers.com for $13,500. His company plans to develop LookUp.com into a resource for reverse phone lookups, people lookups, background checks, etc. This is the perfect domain for these plans. According to Kauffman, his company is “always on the lookout for opportunities to buy and broker premium domain names.”

From what I have heard through the grapevine, Yahoo is looking to sell other domain names as well. It’s a bit surprising that the publicly traded company (YHOO on Nasdaq) is selling great domain names like these, but I suppose if they have no plans for the domain names, they might as well raise some capital.   Sedo acted as the domain brokerage for these deals.

As you may recall, Yahoo also sold Contests.com for $380,000 at the Domain Roundtable conference auction in June of 2009. That domain name was acquired by National A-1 Advertising.

All of these names were registered to a company called DNStination, Inc at the time of sale. However, as the Whois history tool shows, Yahoo was the registrant – MusicVideos.com, Lookup.com, and FreeComputers.com. As an FYI, Oddpost.com is a domain name that was registered to Yahoo and then switched to DNStination, Inc at around the same time as the others, despite the fact that Yahoo bought the company.

New Domain Aftermarket Sites

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In the last couple of months, I have learned about several new domain aftermarket sales websites. Most of the new sites haven’t been started by amateurs, but rather by professional domain investors who make their living in the domain space. Here are a few of the newer aftermarket websites:

DomainMarket.com – This site was founded by Mike Mann, the successful domain investor who founded BuyDomains and Grassroots.org. The company features domain names such as Angola.com, Cameroon.com, Fleece.com, Dusseldorf.com, Females.com, and many other great names. In addition, there are thousands of less expensive keyword domain names costing $500 or less.

SimpleDomains.com – This domain aftermarket was founded by the founders of several websites and businesses on domain names that include Beer.com, Diamond.com, CreditCards.com, Shop.com, and Luggage.com. The company features domain names such as BusinessTravelers.com, TableWines.com, ForeignAuto.com, and GreenInvestments.com. There are also a variety of other domain names in several categories at pretty good prices.

OneOfAKind.com – This website was started by members of the Domain Consultant team, who have over $15 million in domain purchases and sales to date. Some of the site’s showcase domain names include Ring.com, HappyBirthday.com, LifeVests.com and DiamondRings.com. There is a wide variety of names for sale on the site, although most are listed as “make offer” rather than having a sales price.

BestDomainsWebsite.com – This website was started by one of the co-founders of the Targeted Traffic conference, Howard Neu. In addition to regularly priced domain names, they have a list of specials that include TeleconferencePhones.com, FrankensteinMasks.com, and AnimalRightsAdvocates.com.

Privacy After Domain Sales Isn’t a Given, Nor is it Free

A few years ago, I used Sedo’s escrow service for a private domain sale. I had closed the deal in private, but I wanted to have a safe transaction so both the buyer and I chose Sedo to facilitate the payment and transfer. The following week, I saw that my sale was reported to DNJournal by Sedo, listing Sedo as the “Where Sold.”

This same thing happened when I used Moniker to handle the escrow for a transaction several months later. The company didn’t facilitate the sale, and it only handled the escrow for the transaction. This upset me because I didn’t know they reported all sales, and had there been a confidentiality agreement, it would have been violated.

In both cases, Ron Jackson quickly took down the sales reports for me, as I did not want the previous seller to see the prices at which they sold.

I was chatting with a friend today who let me know about a Sedo policy I find disappointing. Sedo charges an additional 2.5% to their sales commission to keep a sale private. I thought this was funky, but it was confirmed by a Sedo employee. I know it’s only 2.5% more from your gross sale, but it seems like highway robbery to me. I hope Sedo reconsiders this additional fee, and I encourage people to simply avoid the fee by asking Ron not to post the sale.

Whenever you buy a domain name from any domain venue, you should proactively request privacy before finalizing your transaction. If the company won’t honor your request (or charges you to keep it private), you should consider your other options.

Let’s Talk About Sex (.com)

Sex.com SaleI’m sure you’ve read the news that Sex.com is the subject of a foreclosure auction next month in New York City. Sex.com reportedly sold for $14 million back in 2006, but there was never any confirmation of the dollar amount for that sale and was only speculation. I am not privy to any information about Sex.com (or the sale other than what was posted), but I want to discuss some things about the domain name itself.

Without a doubt, Sex.com is one of the best pure domain names a company could own. Without it ever really being fully developed into a brand, Sex.com is one of those rare domain names that is already a brand known throughout the world.   Based on the Compete score, it gets decent traffic, and it’s a name that has the WOW factor most others don’t have. This is the name many people would love to have the chance to own if they could choose just one domain name.

There are some downsides to the name though. How does a company monetize it enough to earn a good ROI? Parking the domain name hasn’t seemed to work. Maybe that’s because people who want sex or porn can find that in plenty of other places online. The small portal that is on the site now is presumably not earning enough of a return right now either.

It’s likely the people who are visiting Sex.com don’t really want to find sex per se, but they are looking for porn. Porn is still a taboo word for many, so Sex.com is more of a “comfortable” name to own for some than Porn.com, although Porn.com certainly gets much more traffic and would probably make much more money on PPC. It’s just like a home with a pool. Some people would love to have a pool, but there are many who wouldn’t even consider a home that has a pool. Sex.com is more of a benign name than Porn.com.

According to an anonymous investor that was quoted on TechCrunch, there may be some litigation that could hold up the auction. Additionally, the amount of the debt on the loan is also unknown, and if it’s too high, the reserve price or minimum opening bid may temper bidding or cause people to not bid at all. As the auctioneer commented to me via email, “opening bid will be determined sometime prior to the auction,” and I believe this detail is the most important.

If the auction goes forth as planned, and the reserve price/opening bid is *reasonable,* I believe we are going to see strong bidding from more than one party. If the auction has participants from some of the leading adult companies outside of the domain industry, we could see a record result. In the market today, as Mike pointed out, it might be tough for a company to justify a record setting price. A name like this doesn’t come up for sale often, and this is a great opportunity that more than one company is salivating over.

Sex.com For Sale in Foreclosure Auction

Sex.com

In exactly one month from today, we may see a new record set for the price of a domain sale. I just received an email from a friend with a link to a notice stating that SEX.com will be up for auction. The foreclosure auction will be held at the offices of Windels Marx Lane & Mittendorf, LLP, 156 West 56th Street, New York, New York on March 18, 2010 at 11 am.

In order to bid on the auction, you must come prepared with a certified bank check in the amount of $1,000,000, made payable to “Windels Marx Lane & Mittendorf, LLP, as escrow agent.” The auction may be open to the public.

The auction description is as follows:

All of Borrower’s interest in and to all right, title and interest in an undivided 100% interest in the internet domain name and related INERNIC registration of the URL www.sex.com, and 100% of all cash proceeds, accounts receivable, licensing rights and intellectual property rights directly associated with or derived from the ownership of such URL.

The tale of Sex.com is actually very interesting, and a book was written about it a few years ago. The Cliff’s Notes version is that Match.com founder Gary Kremen originally registered the domain name, but it was then stolen by Stephen Cohen, and a 10 year legal battle ensued. A company called ESCOM, LLC acquired Sex.com in January of 2006, although terms of the deal were not disclosed. There was an article that pegged the sale at $14 million, but there was no confirmation that this number is accurate.

More information about the auction can be found on the David R. Maltz & Co website, and you can also download the auction notice pdf for more information. One interesting note from the auction notice is that it comes from a Dom Partners, LLC at 2050 Center Avenue (Suite 600) in Fort Lee, NJ – the same address as Domain Capital, who reportedly provided part of the financing.

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