I want to take a second to thank you for voting in the poll where I asked you to give your valuation for SlipperyElm.com. There were 217 total votes, and about 46% of those who cast a vote think the name is worth $1,000 or less, while about 54% of voters think it’s worth above $1,000.
If I was going to vote in this poll, I would have selected between $3,000 – $6,000 for the domain name. I personally think it could be sold for somewhere around $4,000, which is why I paid $1,000 for it at Sedo in private. I don’t think it would have necessarily been an easy sale, but I think it could have been sold for that amount, especially given the comments by a couple of people familiar with herbal remedies.
That being said, I felt that I bought the name for a good price and I have the opportunity to add even more value by building a website that has traffic. I felt that I could spend around $75 on custom articles and a few hours of my time putting the site together using a free web template. At worse, I drove my cost up to $1,100 (approximately) for a name I think is worth around $4,000 before development.
While I am growing the traffic that comes to the site to learn about slippery elm, I am also able to monetize it. IMO, I will earn far more from Adsense than I would if I had $1,000 in the bank. At .4% interest, I would only earn about $4/year on that cash in the bank. However, I will bet this name makes around $20/month within 6 months (maybe more). There have been a few paid clicks already, ranging from $.25 to $2.00/each, so depending on where things shake out, it could be significantly more than my prediction.
I am fortunate to be able to take $1,000 out of the bank for this type of investment, and I understand that many people couldn’t. It was just a few years ago that I paid for my first domain name that was $1,000 and it made me nervous. Had this been a $20,000 or greater investment, I probably wouldn’t have gone this route, since I could probably make more flipping names with the $20k in principal rather than letting it sit and build traffic on it.
For me, the bottom line is that I believe I bought an under priced domain asset (I bought it after a couple rounds of negotiations), and instead of trying for a quick flip, I am going to do my best to increase the value of the asset and earn more income than I would have had in the bank. I am going to hope to sell the name for greater than $10,000 once traffic and or revenue justify the value.