Why I Keep Buying

Someone asked me why I was continuing to buy domain names when I couldn’t find the time to develop all of my names right away. One suggestion was to allocate my resources to developing what I have instead of buying more domain names. The question is reasonable and I spent some time thinking about it. Truth is, at heart, I am a domain investor. My business is built around acquiring domain names for good prices and then determining how to make a profit from each domain name I acquire. While I have been developing some of my names and continue to do so, I am not a developer. I believe to unlock the real value of many domain names, development must be done, but I have to determine where to allocate my personal resources, and sometimes development isn’t the best strategy.
When I am in the process of buying a domain name, one of the things I consider is how the domain name could be developed to make a profit. Once the name is acquired, I determine whether it would be possible for me to do this and/or whether I would have the desire to do this. If the answer to either is “no,” I will typically put the name up for sale. Sure, I could keep every great name I buy, but that would make it difficult to generate revenue here and now. In the long run, knowing what to develop and what to sell is crucial, as development can cost thousands of dollars, and recouping the investment might not be possible on some domain names, depending on how it was spent.
A real world example is one my fiancee and I are discussing at the moment. Our kitchen was re-done a couple years before we bought the apartment. I don’t love the kitchen, but I don’t hate it. We asked our building’s realtor to take a look at our place and see what improvements we can do that will be beneficial when we sell in a couple of years. Long story short, she said the kitchen looks good, so there aren’t many things we can do to add any more value to the apartment. If we make changes, it will only marginally improve the value of the apartment, although it will cost tens of thousands of dollars to revamp the kitchen. The kitchen is in great condition, but a buyer might make changes to his liking, so it’s not necessary or recommended for us to do it with the purpose of adding value. Just like some domain names, a website might look nice, but a buyer will probably have his own business plan, so sometimes its better to just leave it alone and sell it as is, as any changes won’t impact the value.
With my developed names, I am planning ahead to create a steady revenue stream for 3, 5, and 10 years down the line. I will always have to adapt to changes in the Internet landscape, but because I am bullish on the .com domain market, I believe no matter what I do, my domain names will increase in value. This is why I spend time and money developing good domain names rather than spending time and money building good websites on sub-par domain names. It is critical to build websites that can adapt to changes, but it is also important to know which domain names to develop and which should just be re-sold. I am always a buyer of great domain names, but determining which I should develop is difficult.

Elliot Silver
Elliot Silver
About The Author: Elliot Silver is an Internet entrepreneur and publisher of DomainInvesting.com. Elliot is also the founder and President of Top Notch Domains, LLC, a company that has closed eight figures in deals. Please read the DomainInvesting.com Terms of Use page for additional information about the publisher, website comment policy, disclosures, and conflicts of interest. Reach out to Elliot: Twitter | Facebook | LinkedIn
  1. Good post. I am in a similar position, except with a slightly smaller portfolio. On a related note, someone please convince me that these vanity tlds are not going to dilute the value of good .coms..??!! .US and .BIZ are different in my opinion. I’m somewhat afraid to keeep buying right now..think of house.prices, stock.prices, losangeles.hotels, newyork.hotels etc. with the sheer number that could come online, I am a tad nervous..any thoughts?

  2. Some people say you make your money when you buy.
    That means that you can sell high later but you can’t always buy low.
    I have been buying a certain country geo for many years waiting for the day when more people will be buying those domain thus driving up prices and development opportunities.

  3. It’s also a bit addicting. I think alot of domainers will agree that once you get involved in domaining, part of the fun is searching for that next great domain name. What’s exciting is the unknown. But even more exciting is developing and unlocking the potential. While small time domainers can’t necessarily acquire premium domains at a premium price (like myself) because of lack of capital, it doesn’t mean that there’s not a market out there for us to buy and sell. In fact, some times one might get lucky and land a great domain name that pays dividends later. Please keep your blog going. It’s an interesting case study for alot of us to see how your domains evolve, whether through development, sales, or ppc. But for me, watching your domains go from parked page to fully developed website is intriguing. Thanks for sharing your experience!

  4. Hi Elliot,
    Another excellent post, I think we have an addiction, I struggle to get by one week without at least picking up a name!
    Even if its a new reg – you can flip domains easy these days the market is still open to making money!
    I regged a name this afternoon drop an email to a few endusers and got three offers £5 reg offer £100 in less than 1hr!
    I agree development is the way forward I havent got the time to develop and often just park but I know thats the future!
    I also think about not just flipping but where to make the cash in the future and look at trends to see where we can take advantage I like the GEO market but there arent many good names left without paying a high price!

  5. Elliot,
    You have a very good strategy. Think long term.
    Buffet didn’t become a billionaire in 5 or 10 years, he laid down the seeds and patiently tended to his garden.
    – Richard.

  6. i like your thinking – have belief in a sound, well-researched strategy and stick w/ it – unfortunately, i think many people jump right in, hoping to win the domain name lottery.

  7. Buying is the easy part. Selling on the other hand…not very easy at all. We all buy. We invest 100% of our PPC income every single month back in to additional names. While it’s nice to have an occasional sale to offset reg fees 10+ years out things should pay off nicely. Good Luck to all of us!

  8. Personally, I’ve slowed my buying (due to buying more expensive names as things evolve) but I think its assumed that a $5000 domain today may cost $7000 later so “buy now, develope later) is a reasonable strategy. Also its safe to assume the drops will get slimmer and slimmer as time goes on.

  9. With respect to the question that new Tlds would devalue .com names who knows, but so far it does not seem .travel devalues travel.com at all. Just an observation though.

    I agree with you on that.
    I would be lying to say I wasn’t concerned at all, but if they do impact the values, I am sure I will have diversified my portfolio by that time. I didn’t buy my domain names when they first were introduced, and I have still managed to do okay 🙂

  10. It would also seem second tier names like vegastravel.com, etc have not been devalued by the introduction of .travel either. In fact, the potential for greater .com value may increase as traffic would probably be driven to the vegastravel.com name from a “branded” vegas.travel site (in the same way well known .edu, .gov, .org, etc sites drive considerable traffic to the same .com names).

  11. First of all, great blog – keep up the good work Elliot!
    In my opinion, the main reasons that .travel and similar existing TLDs haven’t become a factor are the following:
    1. Extensive marketing of .com; particularly during the late 90s “dot com bubble” where you couldn’t watch CNBC for 10 seconds without .com being mentioned at least a couple of times. Since .com was the original extension for commercial purposes, and the one being marketed during the initial Internet boom (when most people learned to use the Internet), it is obviously pretty much hardcoded into peoples minds as THE domain extension. At least for now.
    2) Lack of marketing of .travel and other similar extensions (and I am talking about mainstream marketing; TV/radio and so on).
    As of today, anything other than .com (or possibly .net) is considered somewhat strange and less credible. However, it is all about getting used to things. With dozens of new, generic, industry specific TLDs that are backed by Big Bucks (Madison Avenue among others) I think we can be pretty sure that marketing will follow. Big time.
    After all, the Internet has only been widely used for a little over 10 years. Looking ahead another 10 years, I see no reason why people should not be able to adapt to using a whole range of domain extensions – a new domain structure, in effect. It seems to me that utilizing the TLD to convey information (such as specifying geo or industry) makes a lot of sense. Wouldn’t it make more sense to call DALLAS FLOWERS instead of 1-800-FLOWERS, if you know what I mean – or at least instead of 976-FLOWR2U…?
    In my opinion, .com is here to stay, no question about that. It will also remain #1 for years. However, it will face dilution as dozens of new TLDs are phased in and marketed through the mass media. Eventually, people will get used to domain names of many flavours, and the ones that are short, generic, and to the point as a whole (on BOTH sides of the dot) will be considered the premiums.

  12. Hi Elliot
    Great blog!
    Iam relatively new to pursuing Domaining, and could relate to your recent blog with your panel of experts offering their opinions.
    I have domain names (no sites) parked at GoDaddy.com and the revenues are okay. However, I would like to Park them elsewhere perhaps this may, or may not lead to a higher monthly revenues.
    * Could you please tell me what would be considered the top 3 reputable companies to park domain names with?
    I was also interested in creating my own one page websites for some of my domain names, so that I can optimize them and create the most monthly revenue from them.
    * Since I have a limited budget, could you advise me as to which company, or software, is the easiest, quickest way to create such a one page site?
    * Also, the best company to “Optimize” with?
    * And, where could I find the “Content” to fill this one page website?
    Thank you so very much on any guidance you can provide!

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