Payoneer Escrow is coming up on its one year anniversary as a domain industry licensed escrow service provider (the company has existed longer than that though). I reached out to the company to see if they could share an update about how their business is growing as well as a brief overview about the domain industry. Scott Reynolds, Payoneer Escrow GM, and Brandon Abbey, Director of Strategic Accounts at Payoneer Escrow, provided an update that I could share with readers.
The large escrow providers likely have the best view of the health of the domain space at large. Although licensed escrow providers like Payoneer Escrow and Escrow.com can not generally disclose specifics about deals transacted via their services, I think it is helpful when they offer insights about the current state of the domain business.
Here is what Scott and Brandon shared with me:
“We’d like to begin by saying we have been very pleased with the industry reception to our new domain escrow service. The support from the community has been exciting to say the least. This is truly a global market that needs global support and that is right in Payoneer’s breadbasket. This is one of the main reasons we are enjoying such a fast start in bringing domainers into the Payoneer Escrow ecosystem. Another is we recently introduced a light version of our API which allows marketplaces to quickly set up an integrated payment system for their transactions.
This is still a young industry going through interesting times. Companies have been very active in making moves to drive future growth. Epik acquiring Undeveloped is a good example. Another significant move is Above.com opening a brokerage house and hiring very experienced people to drive it, as well as GoDaddy acquiring large portfolios. We expect to see more M&A activity and consolidation over the next few years.
Most all of the transactions we are seeing are .com’s. While there is significant interest in the new extensions, there hasn’t been much activity on the secondary market. This is to be expected with most of the premium names being sold directly by the registries. From an investor standpoint we think it will be at least a year before there is any significant activity.”
Payoneer confuses me they have two different accounts a card program where funds are loaded onto your card, and I would guess a traditional escrow.
My only concern is the $2K CC limit is just to low for most buyers, buyers need that assurance, and ease, and $2K is not enough, $5K has to be the min.
I am not sure why. I can’t recall ever having an issue with a buyer having to pay via wire transfer.
We are in the process of looking at our credit card limits and I expect we will raise them in the near future. The card program is an option through Payoneer, direct deposit and wire transfer are the primary funding methods. Best regards,
That minimum credit card threshold is important: one of my pricing strategies for a portion of my domain portfolio is centered on how much a middle manager or lower level executive inside a corporation can simply put on his credit card to run the purchase through his expense report instead of having to engage his company’s Finance department to handle the wire transfer.
As a marketing consultant, I have seen this happen myself within more than one corporate environment — the middle manager sees the domain name is available at a good BIN price and his boss just tells him to go ahead and buy it and run it through his expense report, which his boss approves for him anyway because the purchase usually comes out of the boss’s budget (usually, Marketing or IT). If they can put the domain name on his credit card they can avoid the hassle of bureaucracy and any nosey questions about the purchase from another, unrelated part of the company (usually, Finance or Procurement) prior to the purchase.
So, I price many of my domain names just below the typical $5,000 threshold (BIN $4,488 or BIN $4,888) so that the mid-level corporate buyer can conveniently use the credit card option and avoid any corporate hassles.
A $2,000 threshold would require me to lower my prices — me no likey. I’d be less inclined to use Payoneer Escrow as a result. It’s good to hear that Payoneer is looking into raising its credit card limits.
Note: many of these managers/execs also like to use their credit cards to earn airline miles or cash back credits associated with their credit card programs.
Thanks for the feedback. Good points. This is currently being evaluated. Best regards,