Domain Investors Provide Liquidity

When I am trying to buy domain names from registrants who have held them for many years, I am frequently told that their domain names are worth more than I am willing to pay. Perhaps they have turned down better offers in the past, or maybe the discussed the value of the domain names with a broker or someone else. Whatever the case is, some people believe their domain names are worth more money than I am willing to pay.

In all honesty, they are probably right. I would not be willing to pay $25,000 to buy a domain name as an investment if I believe it is worth $25,000. Obviously I can not pay an amount of money that I would hope to get if I was selling it myself. So why should someone sell a domain name to me for less than it is worth? Liquidity.

Here are Nat Cohen’s comments about domain investors who bring liquidity to domain registrants. I believe Nat’s company recently acquired Owen.com and Higgins.com, and his commentary is in the wake of those deals:

Domain names are notoriously illiquid assets in a thinly traded market. Higgins.com, for example, might be worth $150,000 to a well funded business that has “Higgins” as its branding. That valuation is not firm, and it could take many years to achieve that result. Maybe Nat will get lucky and sell in a month. Maybe he will hold it for 20 years without a good offer. Whatever happens, Nat has provided liquidity to the registrant and has another great domain name in his portfolio.

Elliot Silver
Elliot Silver
About The Author: Elliot Silver is an Internet entrepreneur and publisher of DomainInvesting.com. Elliot is also the founder and President of Top Notch Domains, LLC, a company that has closed eight figures in deals. Please read the DomainInvesting.com Terms of Use page for additional information about the publisher, website comment policy, disclosures, and conflicts of interest. Reach out to Elliot: Twitter | Facebook | LinkedIn

22 COMMENTS

  1. Investor liquidity only creates a long-term bubble. While investors trade among themselves, creating liquidity in the short-term, it eventually leads to a stagnated market.

    What happens, is they invest based on the real-time and future demand. Each new investor drives up prices in anticipation for real end-users needing the domains. In essence they squeeze margins now, and future ones too. It takes awhile to ‘max-out’. I think we’re there. Think like the P/E ratio of a stock.

    The second ‘real demand’ slows even a TINY bit, the value falls exceedingly quickly – because future demand/growth becomes questionable. This is the ‘bust’ cycle we commonly see in other markets. Except in other markets, the Federal Reserve steps in and props up asset prices, for fear of deflation. Deflation which will suddenly destroy the entire system, rather than a gradual inflationary failure. The Reserves balance sheet ballooned from $1t to over $7t in ~10 years as evidence.

    The Fed will not bail-out domaining.

    Faced with the nTLD headwinds, .com investors (owning most the market) look to be in a bit of trouble. If end-users start adopting nTLD in real-use in any meaningful way, .com value will crash, fast. It’s certain, with all of history supporting the claim. It’s going to look GREAT. Until suddenly, it doesn’t.

    Considering the low-liquidity of domains in general, I ponder if it’s not already too late for most. Many (good domains) are concentrated in the hands of a few, only exacerbating the intrinsic problem.

    I personally don’t buy into the idea that nTLD successes will drive .com higher. I think that’s an extremely ill-informed view. I do believe .com prices are driven primarily by investors, and not so much what new investors/endusers are keen to pay. It isn’t exactly like most other markets in that sense. Not even like real-estate.

    • Banned 99 years for calling josh co an idiot in PM. That’s because he posted pure lie regarding .com sales in order to dispute *actual fact*

      And pointing out ignorant mods for coddling their pets. The mod kept provoking me, over and over. Telling me, smugly to ‘DM them’, if I had any problems. That is right after they restricted my ability to DM! They then told me to, ‘USE the report feature’, rather than posting provoking words in the posts (pointing out the blatant lies). That’s right AFTER, 2ndly, they restricted my ability to report! They let the lies persist, and the truth, they moderate away. They elevate the situation by insisting I it do things which they just revoked. That place is cesspool of cucks and deception.

      I’ll call a spade a spade and smash these liars/scammers everywhere. They don’t have the reach they think they have.

      This industry is so deluded. On the topic of fact, here, eat some facts:

      .com average price (per namebio)

      $882 – year 2020
      $1,391 – last years.
      $1,376 – last 5 years.
      $2,368 – all time.

      Seem to me, among all the lies, domainers are failing to see the REALITY. I speak too strongly against the agendas, and too passionately about TRUTH, and the industry hates me for it. Will crow be on the menu at in NC next time?

      Open your eyes.

      • To all the pros. In my conversation with the mod, I was informed that “your ‘PRO’ badge means absolutely nothing.” It is not a representation of what namepros really THINKS about you.

        They use you. When they have their back against the wall, they throw you under the bus.

        Your tags are vanity. Thank namepros.

  2. Namepro Mod sucks…
    I got a warning because a user doesn’t like the domain I quoted..and s/he .reports me what a Fucking cry baby…
    The users suck too.
    Whoever reports to the Mod ,you get ding.

    WTF

    • Lol I had ’12 (or 14) reports against me’. Namepros decided to clue me in right before they banned me. Maybe because I stood up against the scammers and liars? I pointed out their pets’ hypocrisy? I enraged some people? They gather in their echo-chambers and band together serial report?

      One guy (slader), literally posted a murdered rat meme, “snitches get stiches” when I said I will just report to the authroties threats of violence against me. Last month, I saw him virtue signaling in another post about a claim some guy got scammed on a million dollar deal. Slader said something on the lines of, “Be the better man and take it to the authorities.”

      Yea. He’s an idiot. A fake. Think you could point that out to him? No. He’s one of their propaganda tools. All because I believe in nTLD. Such bias and double-standards.

      I think I reported 1-2 posts the whole time there.

      I use to ‘dislike’ button on domains that I thought were trash. I got reported for that too. What a sham. Snowflakes. Now it’s ‘disagree’ LMAO. Yea, disagree, to put it lightly. Feelings > reality.

    • I could really write a book on the scum there. Namepros Mod even told me they collecting evidence against me for court! (Never happened). They would get wrecked by me. I wish they would. Selective enforcement and empty threats. Bark-bark hufflepuffs.

  3. There are some fine people on NamePros…
    But, yes, the vultures seeking one english word (max letters 7, etc) exact match .com domains for “top money” (500 USD) are reprehensible. Maybe an “heir” of a dead domainer with a valuable portfolio may respond after googling “sell domains” and landing in a NP vulture’s lair.
    I still recall the guy who went to NP and asked for a valuation of his domain “Social.com”…”50 K” and other “low ball” valuations, the vultures responded, dipping their beaks.
    A broker viewed the thread, contacted the owner, and sold the domain to Salesforce.com for 2.6 million

    • The ignorance and fallacies are spread in every regard over there. It’s hilarious watching them talk about websites and SEO. I saw them struggling to figure out how to best use DNS point to a domain for sale. Biggie insisted his way, and used biggie.us as an example to validate himself. I checked. Page was blank. LOL.

      On a front page thread, mpls insists, “Believe the person you want. SEO is not a science…it is not math”.

      https://www.namepros.com/threads/we-are-the-idiots.1191738/page-6#post-7793268

      The title is fitting indeed. Yes, yes you are.

      “imagine how we, seo experts, feel…”

      Look at all his likes thanks and agrees. More than the others… Unbelievable! Baaahahaaha.

      As an insight, SEO means search engine optimization. Your ‘SEO’ results are dictated by something called an algorithm. It is fundamentally based on math. You figure it out with scientific methods, using empirical evidence as your proof.

      Everything about it comes down to science & math.

      If not math and science, it must be magic – and no one REALLY knows. Right…I’ll buy that /sarc.

        • More? They’re your own worst enemy. Commonly parroting the lie that ‘the domain doesn’t matter (in regard to SEO)’. Couldn’t be farther from the truth.

          First understand the algo has ‘values’, each with ‘weights’. Some things are more important than others. Everything you can imagine, probably matter. Some are relatively easy to improve, others, you’d have to be pretty anal about.

          So about those weights and values. CTR is a big one. If you simply have a backlink, that isn’t as helpful as they’d like to think. How many users CLICK your link, and what is the context around it? Same goes for your domain in SERPS. People don’t tend to click crappy domains. It’s a signal. Meta be damned.

          If your link is getting clicks, it probably means you have a damn good domain. Google doesn’t know it’s a damn good domain. It knows people click it – all that matters.

          The domain is the first key to good SEO and bringing people to your site. From there, the next most important things are how users interact with your site. Stats you can gather and compare from using analytics.

          If your time on site, bounce and other interaction are good, well that means your content is good. Google isn’t reading and judging your content so literally. It is basing the value on those hard stats among other things, such as where user goes next (did the query get filled, or does user need more info?)

          There are so many aspects to SEO that just saying ‘SEO’ is overwhelming to someone that actually knows what’s involved. People tend to think about headings and content. Yea, but it’s hard for me to claim that is SEO. That’s rather the natural way you write. You don’t write to please a robot – you please humans, and the stats reflect that. Hardly SEO anymore when looked at that way.

  4. I send in a domain with a price and you don’t like it,you reported me to Mod as spam…Wtf.
    F cry babies

    Namepro mod is f ignorant or and ambissal

  5. That was one of the things I hated most about DNF years ago. People are such predatory liars, and the worst of it was in the “Appraisal” section. Putting a domain up for appraisal there was often nothing but an opportunity to have it damaged with people’s predatory lies which then could be found on search.

      • @john, I concur….in this case, the owner of social.com was not a domainer. He actually started a dating site with the name/domain in the 1990s, but it never took off. I still remember the “appraisers” citing the domain’s diminishing value. Salesforce.com was celebrating THE YEAR OF SOCIAL that year so the brokers put together a quick sale for the owner.

        I wonder how many offers he got from the NP “appraisers” via messages?

        Their beaks came up empty…

  6. Here a good example,
    Wanted one word dot com for $5000. from a user.
    So reply to the thread…I will pay you $20K USD instead of $5K if you have that domain instead of paying to that sucker.

    So I got a warning from MOD that I am spamming.
    WTF….does the MOD know anything about domains?

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