Nothing silly about it. Domain investing is real money, real time, and can be real draining on the bank account if you get it wrong. Joining a tribe is easy. Dot coms are good. New Gs are bad. All of that is merely talk, pushed by agenda and their particular portfolios. The only thing that should really matter is what is selling and for how much. Did you make money after getting a true cost to operate. The rest you can figure out. Here is the reality as I see it. And yes it is opinion like everyone else. But my agenda is I could care less what race, creed, color or old a domain is as long as I can sell it for more.
- Keep your day job. There is no reason why you can’t make a ton of money in domain investing and still work in the “regular” world. There is more than enough time to put in the hours necessary to find good domains, communicate, and do research. The only way I think you should do domain investing as a living is if you already made enough to quit your job. “I make a great living doing it full time” . That may be true but it a very low percentage of people that do and succeed. And even less of people that started doing it recently. Giving up the best years of your earning career is a mistake IMO. Again, if you make enough to “retire” to domain investing then all of this article can be disregarded. Otherwise. Make your money to pay your bills. Make yourself more valuable in your career. And make that fun money that you can keep rolling in domains. Hungry can drive but it can also force you into bad decisions.
2. Don’t keep putting money into domains. All investments need a bankroll. Pick yours and stick to it. Most domain investors are straight up addicted. They have to look at the list every day. They HAVE to buy. Anyone can buy. Selling is the hard part. Limit yourself if you’re not selling. Buy only when you’ve sold. Don’t add money until you’ve proven your model works. Very few business plans can be fixed by putting more money into it.
3. Things are different now. If you want to follow someone, find someone that is buying now and selling now and making it public. If they aren’t giving real life examples then its not much help. But remember to look at the whole picture. Selling seven names for $10K is great unless you have 200,000 names to renew each year. Gamblers love to tell you their winners but the losing tickets are buried in some trash can. Kudos to those that have been around 10-20 years and selling their older buys. They are killing it and deserve the profits. But a new investor is facing a different path.
4. Domain investing is a very simple process if you think of it from a business owners eyes. “Would I name my product or company this name?” That is how I look at every single name. I ask this to a lot of domain investors when talking about a name and they say yes to some random, long name. That is when I know they have no chance. You have to be realistic. You have to pretend like it is going to be the name you build everything around. After that you have to think of a few things. What are the alternatives to my name? Are there cheaper, better names that could be used in place of mine? Does the name save or cost the new owner marketing money? Are there other successful brands that are close to this name? Is it hard to remember, type, or confusing? Often we can just start with …does it make sense to the new company that is going to own it.
5. The more uses for a name, the better. It is the reason why simple, common, every day words are the most valuable. Throwing in an adjective is another great way to get a good brand for less money. It still can present the same amount of uses for a much lesser cost. Bunny.com is awesome. RedBunny.com is still a great name but much cheaper. Your goal is bunny but you may have to start with RedBunny. What you want to avoid is 3DBunny or eOnlineBunnies.com. In short, the more possible buyers, the more valuable it is.
6. There can be money in newGs but it is a whole different market. There are just too many alternatives to these names and those alternatives are going to reduce your opportunity to sell to almost nothing. You read daily about some sales but most of those are registry sales. Dot Club is completely worthless from a domain investing standpoint but they’ve made millions selling their names. Domain investors? Nothing. Add to the point that the best newGs are priced close to the dot com equivalent and it takes away any scalp on the names. I’m sure there are people that have figured out a business model for making money. Right now they aren’t sharing. That doesn’t mean you shouldn’t keep watching. Its a future market. Those that guess the future will benefit just like in dot com. The difference is there are 1000X times as many things to place your bet on as when the dot com boys were placing theirs.
7. There is nothing wrong to being kind to other domain investors and making friendships. Sure special favors and loyalties grow toward friends and prior business acquaintances but that is how all business works. People help out those that they care for. The saying its who you know not what you know is common for a reason. You bring something to the table and others will want you to come back when its time to eat. Those that bitch about not getting invited are the same guys that show up to a pot luck with no food and complain there wasn’t enough food to go around.
8. Domain articles are written for a purpose. Take all of them with a grain of salt. Some are written purely to provide information. But just as much is to appease advertisers, friends or personal portfolios. The information shared is information that a select few choose to share. Once I’ve read an article I can tell you immediately if it was a true general information article or their was motive behind it. You may not catch it but when someone has a certain type of domain in their portfolio there will be articles promoting the value of similar names to pump up the perceived value of their name. “I don’t know the price that insert similar domain sold for but it was probably insert price to the very high side of range. Through a simple article like that you have set a price range in people’s mind because they often forget you were giving a guess and not an actual price. It’s very effective
9. Find out who’s getting it done and follow. Find the guys that are buying and selling and track them. It’s a bit stalkerish but its pretty easy with DomainTools and DomainIQ to follow portfolios. Watch things come and go and see what they are buying and try and figure out what they sell. I get emails asking me if I sold names that I didn’t announce so I know people are tracking me. People don’t value homes by reading blogs and opinions. They get comps and data. This should be no different
10. Make yourself into a brand. Use your name, your face, and your business to put accountability and trust to your moniker. You’ll be surprised how much easier business deals become when you establish history and a story for others to follow. This isn’t about fame, bragging, or ego trips. This is about letting your hard work attach to you as you progress in domain investing.
11. If you want quick, move to another investment. This requires more patience and time than any other business I’ve been in. Heck my trees only take three or four years until they’re ready to be harvested. Domains can take even longer. And some never sell. To make it even more difficult is adding patience to a shitty domain and you get an even worse domain. You’ve now added holding cost to it. So you have to be patient AND know whether the domain is good enough to be patient with? And that’s why its so hard to make consistent money with domains.
So yes. It’s really hard to make money money in domains. That’s OK. When there are barriers to profitability it leaves more money for the people that work hard and figure it out. I’m a huge fan of barriers to entry because I want to bust through that barrier and take all the money.