For years, I would almost never touch non .com domain names. Reflecting changes I have noticed across the aftermarket, my viewpoint has been evolving. My portfolio now consists of approximately 7.5% non .com domain names. My goal is to increase that to 10% by the end of this year.
I believe the top 3 extensions I own beyond .com are:
- .CO
- .XYZ
- .VC
I am primarily an opportunistic buyer for domain names in alternative extensions. I don’t go out seeking to privately buy non-.com domain names like I do with .com, but I will bid on good opportunities I see in expiry auctions. I believe I have only spent low four figures on one non .com domain name. Everything else has been below $1,000 and mostly below $500. I am strictly a vulture non .com buyer, so there’s no need to pitch me your domain names.
The reason I have been adding non .com domain names to my portfolio is simple. I see many non .com domain names sell on platforms for what appear to be large returns based on my observation of the expiry auction market. I have seen quite a few .AI domain names, for instance, selling for nice ROIs within a year or two of them being auctioned by the registry. This doesn’t just go for .AI domain names. In fact, I shared a recent 3 year LTO deal I have at Atom.com for a .XYZ domain name I bought for less than $500 in an expiry auction:
I bought a one word .XYZ domain name at @Namecheap Marketplace for less than $500 in 2022 (standard renewal).
A buyer just started a 36 month LTO deal at @atomHQ for ~$35,000 USD.
The domain name is now paid off and could bring $725/month (after commission) for 35 more months.
— Elliot Silver (@DInvesting) January 2, 2025
I have also noticed many startups using alternative domain name extensions. Yes, I think most would greatly prefer to use a .com domain name, but they are worth well beyond what is affordable to most fledgling startups.
When I am looking at buying inventory quality .com domain names I would like to own, the bidding often goes well into the hundreds or thousands of dollars for decent names. I am not even talking about exceptional names. Domain names I think could yield retail sales of $5,000 – $8,000 are regularly selling for $2,000 – $4,000. On the flip side, I see solid keywords in retailable alternative extensions selling for under $1k when I can imagine them selling for $5k+. The ROI seems to be there if you pick the right names, and I am doing my best to do that.
I think there is considerably higher risk investing in non .com domain names. The likelihood of them selling is lower than the similar .com domain name. In addition, many have higher renewal rates. There is also legal risk, as it appears UDRP panels are more likely (again, in my opinion) to turn over a defensible non .com domain name than they would a .com. Despite this, in some cases, I think the potential margin is higher right now for the right buys. The downside risk is that they may be far less liquid than good .coms.
With that being said, I’ve only sold a few non .com domain names in the last few years. I am still buying many more .com domain names than non .coms and spending a large multiple on .com domain names. I could be wrong in all this, but I closely monitor my spending for acquisitions and renewals.
Not interested in non-dotcom but there is no denying the level of competition for even mid-tier dotcoms. I’ve participated in those same auctions and being a 10x no less sort of wholesale-to-retail investor. I’m priced out of 90% of all auctions that interest me.
I started in 2015 and every year I buy less and less domains, still under 300 dotcoms.
Yet, most dotcoms sell for around $2,500 retail. GoDaddy and other platforms have confirmed this price point. I see exactly what Elliot sees in the wholesale market, where $2,500 is surpassed most of the time.
Is it an inverse market?
Not sure how the this bodes for the overall domain aftermarket but time will reveal all.