The men all want to be them and the women all want to be with them. The successful domain investor. Making money investing in domains isn’t a fluke. While there is some luck involved, the majority of investors that achieve success share many similar traits and skills that lead them to consistent profit. Here are a few that I think most share.
1. A solid asset with which to work. We all have some names that are less than quality but for the most part, a domain investor that has regular sales has a good quality portfolio from which to sell. Like any other business, you generally have to spend good money to make great money.
2. Good negotiation skills. Anyone can pay too much for a name or sell a name cheap, but doing the opposite takes practice. There are many ways to get your price but those that are successful have figured out a way that gets them where they need to go.
3. Knowing which names will sell. Most domain investors have their niche. A type of name that they know they will be able to sell for a profit. I can talk to 5 different guys and each one of them will specialize in a different segment of the domain market. Some are high end and others are in the $500 to $2000 range. Some are DUI and legal names, others in short letters. Overall, they have a good sense of what price range a name will sell for.
4. A decent bankroll. Successful domainers have all ranges of capital but most have capital available when a good investment pops up. The old saying is you never have any money when the best deals come around but a good investor always has some capital available or the ability to get it.
5. A sales outlet. It could be their blog, a broker, an auction house, or a newsletter but sitting and waiting for offers to come in is only a successful business model for those with giant portfolios. A good business doesn’t continuously take in new money. At some point it needs to generate enough profit to reinvest in inventory. Constantly taking money out of your other business accounts or paycheck to buy more domains is a ponzi scheme within your own investments.
6. Friends in the industry. Look at the guys that are making good money. They know almost everyone in this industry. They are a phone call away from getting any answer to any question they have. They give out and ask for favors from other in the industry. They know who and when to call. It may come across as one person doing well but almost all of the top guys are helping each other out when necessary.
7. Hustle. I don’t mean they hustle in the three card monty sense but the working hard sense. The top people work their ass off. Their are no set hours. You are always at work when all your job needs is an internet connection. This industry is tough and it requires a lot of time and effort to move domains. I am always surprised at the time stamps on the emails I receive. Its all day and night. Effort breeds success, especially in domains.
8. Know how to make money. It sounds like a simple concept but most people I know are followers and don’t know how to make money. They work hard and take a paycheck with the best of them but they don’t know how to make it. Its no coincidence that 99% of the top domain investors where highly successful in the business they were in prior to domains. Business is business. The concept behind buying and selling transcends all industries. A person that knows how to make money will eventually figure out how to do it again regardless of what they are buying and selling.
9. Marketers: Your name is all you have and most successful people in this industry are known by their first name. Because it is such a small group, it is very personal. Most brokers work hard at getting their name out there. The go getters in this industry are just as concerned about being associated with the big sale as they are about actually making money in the sale. Image is very important as it leads to more opportunity down the road. Opportunity equals profit.
Good post.
I also believe the ability to think outside the box can be especially important.
a good sales outlet?agood auction house?
thank you
I think the most important thing is to move your inventory, don’t sit on your domains for too long…they are worth what you can sell them for….business is business whther its cars or domains!
This is a great post. I’ll give you a number 10 to round it off: Embrace the power of “yes”. We all know about the power of “no” – having the fortitude to turn down a significant 5 figure offer to get to the low 6’s but fewer talk about the power of “yes” . You need to be able to swallow hard and take the slightly lower offer sometimes. Always leave soom room for the next guy to profit – incentivize your customer to part with her/his cash, today. In hindsight you’ll rarely regret a sale and it let’s you invest in something new tomorrow. “nothing happens until somebody sells something”. Don’t be afraid to take the money.
Wonderful post. Thank you.
Great points in this post Shane!
Number 9 is interesting: when you get to know these people, you realize that we are in an industry that is fucked. You can’t rely on the big players: the parking revenue nose dives; the traffic from Google is not reliable or a constant; every thing changes on whim. We are betrayed by APpS.
My advice to any newbie, don’t get into this business! You may buy names and develop them, but don’t let anyone sell you a name based on “asset” bull crap, or trend.
It’s all talk.
If you are already a “domainer”, keep kidding yourself. This industry does not exist. No one negotiates for those holding on to names. Everybody wants to sell names to the average domain investor. Don’t be a sucker. That’s my number 10.
As you can see above, Schilling gives an advice that is 180 degrees from Schwartz’s. Sure the truth is the entire gamut. In essence, there’s no structure. Do what you can.
Uzoma,
. You think you are surrounded by idiots but in reality you live in a room full of mirrors. Your are a negative force that needs to go away. Forever alone
No need to hide from sunlight, Shane. Or disrespectful.
I have already gone as far away as possible.
This is all crap. My advice to domainers is: if you have a business concept/idea buy a domain name and develop it. If your concept is good you will make money. We have seen facebook, instagram, pinterest, godaddy, linkedin, bebo, techcrunch and thousands of other websites making millions/billions yearly, and these websites sit on web addresses that are not even premiums, not even salable. These domains would not sell in their life time if they were to sell them undeveloped, no, even for $1. If you don’t have a business concept/idea and you don’t have a premium name that you are willing to sell 15 to 20 times less than the estimated/appraised price then please quit this business because you will waste your life. You will die without selling a single domain name in your life time. I know many domainers plan on leaving their domain names to their children, but I tell you this: your children also may not sell any domain name in their life time. Developing a domain name and make money is easier than selling domain names. Remember: Frank Shilling and Rick Scwartz started domaining since day 1 of this business but they don’t make billions a year, not even 1 million a year, and see facebook, godaddy, linkedin, bebo, alibaba,paypal, youtube, google, instagram, pinterest, tecgcrunch, diapers.com, how much are they making? millions and billions. Develop, develop, develop, develop, develop and don’t let Frank Shilling and Rick Scwartz luck/lottery of 90s confuse you. I or you may not have been around when thing started. Don’t read their posts because you are not as them. They count on their premium domains names to make money, by selling them, and you have none, so do what people in your situation would do: develop.
@Frank Schilling
The power of yes is a great term and I totally get what you mean. And yes the power of “OK I accept” is too. In this market the average domainer can only bluff that they’re not in need to sell but only very successful domainers can afford the luxury of knowing they don’t have to sell. My adivce to anyone in this biz is definitely along your lines. If you see a 30% markup take it. Unless the asset is worth way more than the amount you paid.
So many of us are dreamers, holding out for BIG money that will never come.
@Uzoma
Sounds like you’re bitter pal. Bottom line for me is that as long as there is an Internet there will be a market for domains. Sure that market will peak then fall then bounce back then fall some again ad infinitum and yes PPC has gone to hell but aftermarket seems pretty buoyant to me.
@ Shane
Great post and a very interesting one too! 2. Good negotiation skills. This is the one I agree with most. It’s essential.
6. Friends in the industry. Is vital too (as are all the others) but the true beauty of this Biz is that anyone with good instincts can step right into this Biz and make money.
Networking is crucial but you could literally know no one, buy the right name/s and have a sale for great profit within a week. All we need is the right person at the right time check whois and email us.
To: Andy Kelly
I’m NOT bitter at all.
I’m simply adding my own #10 to Shane’s 9 point bulletin.
See, in America, we still have the right to freedom of speech.
Everybody has a business model, it seems, to plague on the unsuspecting “domainer”, sell them names or stuff; so I’m warning them, they don’t have to listen to me. But I have the right to speak the truth as I see it, bitter or not.
So, no…
Schilling and Schwartz are Both Beasts with different models. They both kill it in their own ways. Mann is another one who has a method that works.
Plenty of opportunity in the middle of those three.
Niches, names with stats & getting in front of trends similar to stocks, real estate, commodities.
Bottomline, is one needs to take risk to make money. If you don’t have the stomach for it then don’t bother playing the game cause you’ll never make it through the difficult periods of trying to figure out what works for You.
Nice Post Shane.
@ Uzoma
have no intention of taking away your right to free speech! Just disagree with you is that ok?
@Kelly
perfectly, neat to disagree. That’s what discuss is all about. I welcome it. But I must warn you, chances are that the further you drift from my position, the more of an arse you make of yourself :-]
lol you have to laugh at that!
Some folks thing they have a monopoly on the truth, when all they really have is a monopoly on their own BS
Love Emma, she wins Aggro’s “they get it” award
Here’s what Aggro has to say:
“Entrepreneurs make it happen, domainers wait ’til the entrepreneur makes it happen”
Great points Shane – I constantly evolve my plans as the market changes. I am always open to learning to improve my investments.
The biggest change is that I “develop” more and follow through with the business ideas I have for some of the domains. Its been a lot of fun.
@Emma
“Remember: Frank Shilling and Rick Scwartz started domaining since day 1 of this business but they don’t make billions a year, not even 1 million a year”
Emma you are clearly misguided on this point, so the rest of your ramblings are as well.
Keep in mind fellow blog readers and commenters. Opinions on blogs are like a’holes. . . everyone has one. Some are just more full of shit than others.
Emma: Well put. I want to read YOUR blog.