As you may have heard, a company called Close acquired the Close.com domain name after operating on Close.io since its inception. The company detailed how it acquired Close.com in a blog post, and I shared some of my thoughts about the company’s acquisition of Close.com.
I think there was one additional valuable takeaway from the story that I don’t think anyone really discussed. Despite the fact that the former owner had the awesome Close.com domain name before selling it, that startup ended up not being as successfully as originally hoped. From the Close blog post detailing the purchase:
“After a year of working on their idea though, the business wasn’t really taking off the way they’d anticipated. Things weren’t looking as promising anymore, but he still didn’t want to sell the domain yet despite starting to fold up the operations of their startup.”
The key takeaway domain investors should realize is that there is a lot more to a business than a domain name – even if the domain name is great. If the business plan doesn’t work out, if the revenue numbers aren’t there, if there are too many industry regulations to overcome, if the product or service fails…etc., even a great domain name will not be the savior.
One nice thing, which was demonstrated by the acquisition, is that a meaningful domain name like Close.com can retain its value even if it was associated with a company that was not successful. In fact, a domain name like Close.com possibly increased in value since it had previously been acquired.
Domain investors, myself included, like to think we have an asset that is essential to a company’s success. Yes, a company like Hotels.com needs the Hotels.com to make sense. However, we need to realize that the domain name is just a piece of the puzzle a startup founder or business person looks at when building or growing a company. A great domain name can provide a major boost to a company, but it is not the be all end all that we sometimes assume.
There is great value in the top tier domain names, but for most companies, it is nice to have but will not be do or die for them. History shows us that plenty of companies had great domain names but were not successful.