A quick way to calculate how much money your domain portfolio will generate this year

One question I see come up over and over again in the domain name world is how to calculate how much money you’ll actually make selling domain names. Most new investors read about blockbuster sales and assume they’ll be bringing in six-figures in no time. Usually a year or two in, domain investors realize that this is actually a very hard industry to make money in.

As I’ve said many times before, if you’re looking for a way to get rich quick stay far far away from domains. That being said, domain names have changed many lives, mine being one of them, but it took a lot of time to learn how to set realistic expectations.

While some years you’ll end up selling a domain or two for a lot more than you thought you would, I always recommend new investors be realistic and run a simple calculation to give them a baseline expectation of how much money they’ll actually generate from their domain portfolio.

The calculation I’m going to share assumes a few things:

  • You’re not doing any outbound
  • You don’t have a portfolio full of junk
  • A majority of the domain in your portfolio are .COM

If you can’t check all three of these boxes, hit the back button because the math I’m about to share isn’t going to apply to you. If you do outbound, this will be an underestimate, if you have junk domains or lots of non .COMs this could be an overestimate.

Last but not least – there is no magic formula to truly calculate how much money your portfolio will generate so take this with a grain of salt. Okay, still with me? Here we go.

Calculating domain portfolio revenue expectations in 2021

  1. Take the number of domains in your portfolio and multiply that number by 0.01, this will give you the total number of domains you might sell this year and could overestimate a bit. For example, if you have 500 domains, you can hope to sell 5 domains this year if you’re lucky.
  2. Multiple this by the average price you have seen your domain names sell for. For most people this will be something in the $1,500 – $4,500 range.

That’s it! Not happy with the number? Start doing outbound, buy more domains, do some domain brokerage on the side, there are lots of other ways to generate revenue. Hopefully this gives you a bit of a sobering but realistic view of what you’ll make this year.

Disclaimer: The above references an opinion and is for information purposes only. It is not intended to be investment advice. Seek a duly licensed professional for investment advice.

{ 4 comments… add one }

  • Brad Mugford June 5, 2021, 3:15 pm

    That math is based on a 1% sell-through rate which might be on the lower end, but is still within a standard 1-2% range at normal end user prices.

    Bad domains, or higher prices = low sell-through rate.

    The higher the quality and lower the prices the higher the STR will be.

    Exposure matters a lot also. If you have domains priced on popular venues like Afternic/GoDaddy they are far more likely to sell than unpriced domains that are not listed anywhere.

    Brad

    Reply
    • Morgan June 7, 2021, 11:14 am

      Well said Brad and agreed 100%!

      Reply
  • Mark Thorpe June 6, 2021, 11:03 am

    You can’t sell domains if you don’t have them listed for sale.
    I don’t think $1500-4500 should be anyones sweet spot/range, 5k-10k minimum should be your price range IMO. You can always lower prices if you receive an offer. Sometimes you have to leave some money on the table.
    Just don’t sell yourself short.

    Reply
    • Morgan June 7, 2021, 11:15 am

      @Mark – fair point, but for many new domain investors they won’t find much liquidity in the $5k – $10k range, I’ve found the $1.5k – $4.5k range is a great place to start, esp if you’re buying expired domains in the sub $500 range.

      Reply

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