I had dinner with a friend last night who is also involved in the domain industry. He is involved in a different vertical than I, but we share a number of friends and colleagues in common. Coincidentally, his wife and my wife have been pursuing the same psychology doctoral degree, so while our wives talk psych, he and I can talk business.
One of the topics that came up was the fact that there are a number of shady individuals and business practices happening all over the place in the domain business. Most of these people and companies aren’t well known and try to stay under the radar to avoid troubles. My friend and I attributed this to the “easy money” reputation of the domain business and of course the low barriers of entry. You really need nothing more than a computer and internet connection to get involved.
It seems that some people think there is easy money to be made in the business, and because it’s done virtually completely online, shady people can do things they likely wouldn’t be able to do in a more highly regulated industry. People lie, cheat, and steal in every type of business, but it seems to be a more common occurrence in domain investing. I don’t want to say it is common, but I’ve come across and heard about a number of shady people and shady dealings.
IMO, forums and blogs have helped regulate some of this shadiness because criminals like to act “in the dark.” Forums and blogs allow people to bring issues to light, and that is just what shady people want to avoid. It certainly hasn’t eliminated shady activity, but I think it helps keep it down.
Before you do business with anyone or any company, you should always do your due diligence. A person or company that made mistakes in the past may not make them in the future (most people deserve a second chance in life), but always keep vigilant and be aware. I tend to trust people at their word, but it’s not something that should be done regularly. There’s a LOT of money to be made in this business, but the most valuable asset is your reputation.
As with every post, but especially with this one, make sure your comments aren’t libelous in any way. I don’t edit comments, so posters are responsible and liable for what they write.