Domain brokers can be very helpful. Some of the best domain name brokers sell millions of dollars worth of domain names each year. Brokers can be an essential part of the process of selling domain names, and there are quite a few domain brokers I respect and would use.
It is very easy to become a domain broker. There are no qualifications required, there are no certifications needed, and literally anyone can call themselves a domain broker without any industry background or experience (do a Google or LinkedIn search to see how many there are!). As far as I know, there are no requirements for people to identify themselves as professional domain name brokers. It is because of this that due diligence is required before choosing a domain broker.
I am fortunate to know quite a few exceptional domain brokers, but I thought I would share some thoughts on how I would go about choosing a domain broker if I did not have these contacts.
For the purpose of this article, I am going to assume that a domain broker made the first contact with me to ask about selling one of my domain names or I did a Google/forum/blog search to find the names of domain brokers. Essentially, the assumption is I know the name of a broker but know nothing about that broker.
The first thing I would do would when contacting a broker to sell a domain name is to ask for a list of domain names they sold. For privacy reasons, many can’t or won’t share sale prices. Most people in the business can distinguish a good name from a bad one, so knowing what was sold can give you an idea of the quality of names that broker sells.
I would then ask the broker for the contact information of buyers and sellers for the domain names mentioned as sold. I would also ask both of those parties about their experience with the broker. It would be good to know how well the broker communicated, the types of marketing the broker did to sell the domain name, and ultimately, the level of satisfaction they have with the broker. Importantly, I would use the Whois database to make sure the references given match the buyer and seller email addresses so that the broker can’t give bogus information.
I personally would not trust a domain broker who is unwilling to share domain names that he or she successfully brokered or references from satisfied customers. I understand the need for privacy, but in this case, it is important to know that the broker is legitimate and not simply using discretion as a means of not having to share this important information.
I think a Google search of the broker’s name or company name can help reveal information about brokers. It can potentially lead to articles about the broker’s sales and perhaps some issues the broker had. Google would also likely show domain forum results that could help uncover information about the brokers, as shared by people in the domain investment community.
I might call trusted companies in the industry as well as domain name lawyers to ask about individual brokers. Knowing how small the business of domain name investing is, I would imagine an industry lawyer or company representative can share whether a broker is trustworthy and good at brokering.
Just because a domain broker is good does not mean they would be good for me or my domain name. Some brokers have great industry contacts and can sell well priced domain names very quickly. This might be good for someone looking to sell a domain name quickly, but it is not as helpful for someone with a high value domain name and no urgency to sell for the maximum value.
Once I narrowed down my list of brokers to 2 or 3, I would ask for their expert valuations and likelihood of them selling the domain name and how long they think it might take to sell. Just because one broker shares a much higher valuation, it doesn’t mean that they will be able to sell the domain name. I would want to know their marketing plan for my domain name. Perhaps I would request a domain sale RFP to see how they will sell the domain name.
I would ask to review their brokerage contract and make sure exclusivity period and commission structure is clear. I would also ensure that they use a third party escrow service like Escrow.com, Escrow.Domains, or Payoneer Escrow to close. I would not allow a broker to handle funds under any circumstance.
Ultimately, I want to ensure several things when choosing a domain broker:
- The broker is trustworthy and a good communicator.
- The broker values the domain name as much as I value it.
- The broker has the ability to sell my domain name for my desired price.
- The broker is easy to work with.
- The broker is respectful and respected.
- The broker’s commission and exclusivity periods are clear and fair.
- The broker will not put my domain name at risk of legal issues.