Don’t Put Too Much Stock in One Sale

I had a nice five figure sale to close out last month. It was the kind of name I can easily replace, and in fact, I have been working on that. I have been buying similar types of names inexpensively, figuring if one startup paid five figures, others would probably do so, too.

Although it didn’t cost me much money, this wasn’t the best move.

After I sold the domain name, the nameservers changed to GoDaddy default servers from my Dan.com servers. The Whois record was private, like all new GoDaddy transfers. I had no idea who bought the domain name or how it would be used. This afternoon, I checked on the domain name to see if the buyer is using it yet.

To my surprise, the domain name now resolves to an Afternic “for sale” landing page. I checked Afternic.com, and the domain name is listed for sale at approximately 30% above my sale price. The minimum offer amount is below the sale price. I clicked on the listing and see the account owner is selling just this one domain name and the account was created this month.

My takeaway from this is the buyer may have acquired the domain name for a project and decided on a different domain name. Perhaps a better domain name was found or the team preferred an alternative. I doubt it was an investor because this would be one of the top 5 public sales of its kind and I don’t think it was priced at an investor level. In addition, I highly doubt an investor bought it to re-sell with such a small margin after a commission would be taken.

At the end of the day, we shouldn’t put too much stock in one-off sales thinking they will be easy to replicate. Fortunately, I only bought a handful of similar domain names at auction. I will also reconsider the price increases on the similar names I already own, as my initial hypothesis about the buyer and its purpose were incorrect.