Difficult Offer to Accept

11

When I agree to buy a domain name in the aftermarket, I typically have a value in my mind for that domain name. This value assumes the right buyer wants (or needs) to buy it, and they will be willing to pay what I believe is a fair price for the domain name.

Oftentimes with my domain names, I will reach out to prospective buyers to gauge interest in an acquisition. In addition, when I receive an unsolicited offer for a domain name, I may  also reach out to prospective buyers to see if any other companies would be willing to pay more for the domain name.

The result of these sale efforts is sometimes a decent offer, but one that falls below what I think the domain name is worth. Offers that are decent but fall short of what I believe the value to be are difficult to accept.

On one hand, I have reached out to the most obvious prospective buyers for a particular domain name, and the offer I am contemplating is the best of what I received. On the other hand, another buyer could want the domain name in the future and they might be willing to pay much closer to what I believe the value is, especially because it can be more difficult to get an offer when I am essentially cold calling.

When I receive offers that aren’t all that close to what I believe the value is, but the offer is fair,  I make a determination about whether it is better to reject the offer and hold out for more in the future. Some things I think about when I am in this situation include:

  • Responses from the companies I contacted
  • Previous offers for the domain name
  • Number  of offers received
  • Earnings for the domain name
  • Other opportunities that are available
  • Cash position

If it makes sense to my business, I would consider selling a domain name for less than I think it is worth. Sometimes it is better to sell for a bit less when a decent offer is presented than to regret passing on the offer.

11 COMMENTS

  1. Elliot, I would like to get you professional opinion on the value of a domain I my put into HA’s February finacial/banking auction.

    While I have a perceived value in mind (in August 2008 I started to work on the app Bank related.) I would like to compare my value against someone who has been actively buying and selling domains.

    What would be your perceived value of “iBankSavings.com” as in (Internet Bank and Savings)

    As example: “esurance.com”

    I do have potential IP in the form of a prototype to go along with a possible acquisition.

    Your value will help me understand real market value.

    Thank you in advance

    Chip

  2. Erez , drtcheap.com doesn’t pass the “Radio Test”. Oh , I know “drt” is supposed to mean “dirt” , but that’s because I’m LOOKING at the domain name and not HEARING it mentioned. Each and every time drtcheap.com is mentioned the spelling will have to be explained. That’s definitely not good.

Leave a Reply