startups

There have been some truly stellar domain sales with both one and two-word .COMs taking the cake when it comes to value. It’s also pretty well known that many of the top sales you read about on places like DNJournal, often started as a smart buy some time ago. While people often say “all the best .COMs are taken” they’re often missing all of the aftermarket activity which has a lot of good deals, if you take the time to do a deeper dive.

This week I have hand-picked five domains, all of which I think would be a great brand for a startup, and all at prices that aren’t going to break the bank. To make it a little more fun I decided this week to break it down into two categories, one for startups that have raised Angel or a Seed Round (let’s say $3M or less) and another for startups past Series A.

The reason here is simple – if you’re just getting started and have a few hundred thousand dollars in funding, spending $50,000 on a domain name might not make sense. At the same time, a startup that has raised $5M and has a much bigger marketing budget might get a lot of value out of a $50,000 domain. Make sense? Enough from me, let’s get to this week’s names.

Domains for Seed Stage Startups ($3M or less in funding)

Hydrated.com – nice one-word .COM, perfect for a startup in the drink business, water, sports drinks, etc. Current bidding is at $1,169 with nine days to go. I could see this name going for something between $5k – $15k depending on how intense the bidding gets towards the end.

SnowBay.com – great brand for a startup in the winter space, I know a lot of people are looking for snow and ski gear before the holidays, could SnowBay be their next destination? This domain is only at $70 as of this post being written and I’m guessing it will go in the sub-$1,000 range.

ClickLoans.com – another category-specific domain, but a great one for anyone in the online lending space. This is another example of a domain I think will probably be a pretty good deal for whoever gets it, currently at $350 with less than two days to go.

Domains for Series A+ Startups ($3M+ in funding)

BirdHouse.com – solid two-word .COM that could be used across a number of different verticals. Great brand, easy to spell, easy to remember, and will usually bring up a nice positive image in someone’s head when they think about it.

Veggies.com – you know you’re supposed to eat them, heck I’m from Berkeley so veggies have been core to my diet for a long time! That being said, for a startup in the vegetarian/food space this could be a really great brand to build on.

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twitch streamer

If you haven’t been to Twitch.tv before don’t feel bad, you’re not alone. I just started watching Twitch regularly probably around eight months ago myself, and I feel like I was missing out on an entirely different world. What I found is that there are some seriously famous streamers on Twitch that are bringing in six and seven figure incomes playing games for adoring fans.

New Yorker

Each month, a hundred million visitors watch their favorite personalities play video games on Twitch, spending an average of nearly two hours a day there. This audience is large enough to make the site one of the twenty most trafficked in the U.S., yet it’s perhaps more apt to measure Twitch against a different medium. With viewership numbers that rival those of MSNBC or CNN, Twitch is less like a conventional Web site than like a kaleidoscopic television network: thousands of channels at once, broadcasting live at every hour of the day. (Source – The New Yorker)

Soak that in. Twitch is now one of the twenty most trafficked sites in the US and the vast majority of the content is watching people play video games. For advertisers, this has been a dream since the average viewer of a Twitch broadcast spends a lot more time than just about any other viewer. Gaming sessions can go on for hours and viewers can easily watch for the entire time.

As I write this post I am also listening to one of my favorite Twitch streamers – sodapoppin playing World of Warcraft in the background.

sodapoppin-twitch

Now all of this being said, it goes without saying that Twitch appeals to a somewhat specific audience given that they’re watching other people play video games. If you never played games, you probably aren’t going to get too excited about watching other people play them.

In many ways Twitch itself represents a bit of a generational divide. I think there is a growing group of people who grew up playing and watching video games that are identifying with competitive video games in the same way many people do sports like Baseball and Basketball. If this sounds ridiculous to you, you’re on one side of the generational divide, if this sounds normal then you’re on the other side.

No matter what side you find yourself on, one thing is certain, viewership for eSports is growing faster than massive industries like television and music, Twitch is minting new millionaire game streamers every single year. The real question is, when will watching competitive eSports be seen as normal as watching a little football on a Sunday?

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When I first started buying and selling domain names I used the current top domain sales as my inspiration. I saw some nice two-word .COMs that were selling in the five figure range and went to town. Of course I quickly learned that I had bought a bunch of junk, it wasn’t just all one-word .COMs or two-word .COMs, it’s the quality that matters. But with quality comes the understanding that to get top dollar your time horizon has to be a lot longer than most.

And this is where new domain name investors get confused when they’re looking at lists of domain sales. Yes – the sales numbers are real, but the data you’re not seeing is the amount of time the domain owner was willing to say no, be patient, and wait for the right buyer to come along. Mike Mann for example usually hangs onto a name for more than five years before it sells:

(One thing to remember is that Mike Mann needs to sell about $2.5+ million worth of domains per year to break even and that he is NOT a flipper. The average holding time for his sold domains is usually more than 5 years.) (Source – OnlineDomain.com)

So here’s what happens. People look at domain sales, try to buy very similar names, then get frustrated a year or two later when “they haven’t sold yet!” What you have to realize is that you might have bought a great name, but the right buyer isn’t there for it now…the question is did you buy the name initially with the idea of waiting five or more years for a buyer?

If not then you might not be completely realistic when you’re trying to industry pros are doing. Rick Schwartz, the Castello Brothers, and many other top industry veterans are known for waiting for the right buyer and not looking for a quick flip when it comes to their top sales.

The question is, are you being realistic with yourself when you buy a domain that looks “almost exactly” like a domain that sold for a small fortune last week? Most people are not, especially in the beginning, and I know I wasn’t being realistic for years.

What do you think? Should domain name investor be paying attention to how long someone had a domain before it sold when looking at domain sales?

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brand

Dapulse is a startup that makes some pretty slick collaboration/communication tools for teams, they’ve raised over $34M and are trusted by companies like the Discovery Channel, Uber, and Adidas. But let’s pause for a second…what the heck does Dapulse mean?

If you’re scratching your head trying to piece together some logic behind the name, you’re not alone. Roy Mann the CEO of Dapulse shared how they picked the name with Business Insider:

Business_Insider_logo

“When we were first starting out, our priority was on building the best product we could, and less so on the name,” said Roy Mann, CEO and founder of the company. “Based off what we felt was the essence of our tool, a platform to help you keep your finger on the pulse of your team, we identified with the concept of a pulse. After searching for domain options, the only website available was dapulse!” (Source – Business Insider)

Well it turns out that the name was a bit of a problem since nobody could really understand what it meant and at one point a TV anchor actually started laughing at the name while interviewing a Dapulse employee on the air. That being said, obviously making their top priority building the best product they could definitely was the right move. Raising over $34M doesn’t really happen unless you have a kick-ass product.

That being said, it does show how a branding mistake you make early-on can become a bigger and bigger problem as you grow. Too many startups set their budgets at $10 for a domain which means they have to come up with something completely random. With even a small budget ($5k – $10k) there are some truly exceptional domains available.

Of course my guess is Monday.com sold for a lot more than $10k, given that one word .COMs like Freedom.com sold for $2M this year and even two-word .COMs like MyWorld.com hit the $1.2M mark. The question is, do strong brand names like these more than pay for themselves with the long-term benefits that they bring? I think so, but I also know many people who could care less and just want to build a great product.

Clearly, like Dapulse proved, you can build, fund, and scale the heck out of a great product on a mediocre name, but I wonder how much additional benefit they would have had along the way if they picked a stronger brand name out of the gate.

What do you think? Was this a branding blunder or does it not really matter since they still built a kick-ass product that people use, love, and recommend. I want to hear from you, comment and let your voice be heard!

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discussion

A couple of days ago I wrote a post about equity management platform eShares rebranding to Carta after they failed to secure eShares.com. Most people would assume that any company that can raise north of $67M would surely already own their .COM. They didn’t, and the CEO came out and said that the reason they changed their name is due to the fact that they couldn’t come to whatever price/terms the current owner has for the name.

It seems my readers are pretty divided about whether this was a good move or not. In one camp there are people who think that this was a huge mistake and that eShares should have done more to acquire their .COM and the rebrand is a branding downgrade. In the other camp are people who say that eShares sounds dated and that Carta is a solid upgrade. Oh, and there’s also a third camp that feels like the people who use a service like Carta are tech savvy and fans of other non-.COM gTLDs so they should have branded on a .CO, .ME, .IO and secured a better name.

One of my favorite comments which I do have to say I agree with is from Barry who said:

Well haha 😂 and good luck now to the current owner of eshares.com

Your golden goose just left the building.. ‘regrets I had few, but to few mention…’

What is never mentioned much by domainers is the greediness and ridiculous price expectations many have.. 

I wouldn’t be too surprised if the owner of eShares.com watched the startup raise more and more funding, and with it increased their price. The question is, how far up did they go? $1M for a domain like this could make a lot of sense for a company that has spent a lot of time and money building a brand on the name. At the same time, the owner could have gotten a little too greedy and asked for something in the $3M+ range which probably wouldn’t make sense.

I’m not sure we’ll ever know how it all went down…but that won’t stop me from trying to get in touch with the owner of eShares.com to get his side of the story. With the limited data that we have right now, it’s hard to say if the domain owner just wanted too much for the name, or if Carta didn’t chisel out a meaningful budget for a domain. One thing is certain, like the comment above says, whoever owns eShares.com and thought they were going to have a big payday just got some very bad news.

What do you think happened? Oh and if you’re the owner of eShares.com and want to chat, I’d love to give you the chance to tell your side of the story!

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trusted-brand

In all honesty I’m pretty shocked about this one. If you haven’t heard of eShares let me drop a little knowledge before we continue since we’ve been a customer for years and I really like what they do. eShares (errr, Carta) allows startups to easily manage and grant equity all through a super slick, easy to use platform. They essentially led the charge in getting rid of paper in the entire startup fundraising process outside of the Term Sheet itself…which now gets signed with DocuSign so I guess that happened along the way too.

eshares-logo

The first year that we used eShares I found myself constantly going to eShares.com, and then remembering – oh wait, I need to go to eSharesInc.com which uh, obviously isn’t nearly as good. That being said, as a customer it didn’t impact my decision to use them, most of the other startup founders we knew at the time used eShares, it was clearly the popular option, so we went with it.

That was way back in 2014 when eShares had only raised around $8.8M, since then they’ve gone on to raise over $67M and they are (with a whopping $42M coming in last month), and without a doubt, they are most well-known company for startups that want to manage the equity process digitally.

eshares raises 42 million

While eShares has been kicking ass and taking names, they never made the move to eShares.com. So you would imagine that the owner of the .COM would notice eShares massive funding rounds and raise the price. I’m guessing this is what happened…and I’m guessing the price went too high since eShares announced this week they have rebranded to Carta (along with the corresponding Carta.com) after they failed to get eShares.com:

eshares-rebrand-carta-email

It’s an interesting move in two ways:

  1. Clearly not owning the exact-match .COM of their name didn’t hold them back. They raised over $67M and become the category leader by a massive margin without owning their corresponding.com
  2. By the time they probably had enough money to buy the .COM, their business had grown to a point where a rebrand was in order since they wanted to expand beyond the electronic issuance of shares

I’m a proud Carta customer (boom – just used the new name!) and know many other founders that like me, swear by it. Still I have to say, it feels like they could have picked a better name to brand on, Carta just doesn’t have a great ring to me, at the same time eShares did but only for what they were doing at the time. Still, I’m interested to hear what my readers think, is Carta a good rebrand or are there better names out there?

I want to hear from you, comment and let your voice be heard!

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Below is a screenshot of the inbound offers I received on my domains parked at DomainNameSales.com for the month of May. I currently have my domains parked between DomainNameSales.com, Efty and Afternic. As most of my readers know, I don’t make millions with domain names, instead I sell between 0 – 2 domains a month. That being said, the majority of my sales do come through services like DomainNameSales.com, Efty, and Afternic so I’m a big believer in the value that they bring.

That being said, everyone once and a while something like this happens. A domain that I own, CCV.me is getting a steady stream of offers covering a wide range from $250 up to over $50,000 – but none of them seem real, nobody responds, and it just clogs up my inbounds with what really feels like pure junk offers.

domain-offers-may-2017

I haven’t had this happen to me before, sure I’d say about half of the inbound offers I get are junk offers, but this is non-stop and all junk. So I pinged a few friends that have a lot more domain names than I do and asked them what they would do in a situation like this.

The best recommendation I got was to put that name specifically on a parking service that requires an upfront payment to make an offer, this would definitely filter for only the most serious buyers. So I decided to put the domain on DomainAgents.com, here’s what the landing page looks like now:

domain-agents-landing-page

As I expected, immediately the inbound offers stopped, and to be honest, I haven’t had a single inbound on the domain since I moved it over. While in some cases I think you might be inclined to think, “hey that killed my inbounds!” the reality is…it’s not a great domain name, and I don’t think a name like this would get more than one or two inbounds a year. I do think that this landing page is doing a great job of filtering for only serious buyers because I honestly do think this domain has many serious buyers.

Domains like ClosetDesign.com, Friending.com, STAA.com, etc. are the ones that typically get the most real inbounds, i.e. one and two-word .COMs. So if you ever find that you have a pretty mediocre domain that’s getting a ton of offers…don’t trick yourself into thinking you’ve struck gold. Those inbounds aren’t really, you just need to apply a filter to prove it.

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I’m someone that has always paid attention to things in the domain industry that I think go against the norm. Those little opportunities that oftentimes don’t pan out, but pay big when they do. Of course I haven’t made millions chasing these niche opportunities so I’m not telling you that you should, but I am saying it’s hard not to pay attention to.

namejet-logo

Often it’s little blips in the radar like this that might make you think twice about a domain you’d otherwise pass on. So when NameJet put out their sales list for last week I was not surprised in the least to see .COM dominate the top ten list. XLC.com took the top spot at $49,100 and KOV.com rounded out the top ten at $15,327. No surprises there except maybe that the buyer of KOV.com got a pretty solid deal IMO.

What did surprise me is two .CC sales, KS.cc for $22,560 and 837.cc for $15,000. While I’ve owned a handful of .CC domains over the years I’ve pretty much turned away from .CC as an extension that I want to put any investment dollars into. The vast majority of what I buy and own is .COM and I don’t see that changing apart from the .IO domains that I buy every now and then.

But I’m pretty surprised – $15,000 for a 3N .CC domain? That sold for more than QVM.com and eShare.com which both sold for closer to $13,000. If you keep scrolling down the list you’ll find everything else is pretty much .COM, but these two .CC names in the top fifteen was interesting to see.

I think if I was going to start investing more in .CC I’d probably take this as a lesson that only super short names and numerical domains would make sense, and to be realistic I’d probably be sitting on them for a long time to sell them anywhere near these prices. For now, I’ll just look at it as a blip in the radar, it’s clear from the list of sales from last week that .COM is still where all the action is…but it makes me think, am I missing out by not at least considering .CC?

What do you think? Comment and let your voice be heard! (and you can see the full list of sales from NameJet below)

xlc.com $49,100.00
svg.com $30,300.00
dzt.com $28,911.00
tlx.com $25,000.00
hpu.com $25,000.00
jju.com $25,000.00
mglobal.com $24,099.00
lwr.com $23,522.00
ks.cc $22,560.00
kov.com $15,327.00
unmillenniumproject.org $15,200.00
837.cc $15,000.00
vqb.com $15,000.00
4052.com $14,002.00
qvm.com $12,800.00
eshare.com $12,750.00
99980.com $12,210.00
domainlookup.com $10,650.00
happychef.com $10,357.00
telechargementz.tv $9,103.00
reps.com $8,095.00
10019.com $8,000.00
interra.com $7,700.00
homemonitoring.com $7,601.00
cityspace.com $7,600.00
usaid.com $7,000.00
cc222.com $6,720.00
palmreading.com $6,599.00
tingzhe.com $6,200.00
30188.com $6,110.00
teti.com $6,088.00
saviour.com $6,010.00
11513.com $6,000.00
delicatessens.com $5,905.00
wona.com $5,855.00
livetrading.com $5,750.00
poignant.com $5,701.00
damall.com $5,600.00
77234.com $5,033.00
qxxl.com $5,001.00
openenergy.com $4,988.00
86556.com $4,899.00
68876.com $4,899.00
commercebankfl.com $4,644.00
ncbank.com $4,413.00
edio.com $4,400.00
93668.com $4,399.00
shangwei.com $4,215.00
spew.com $4,204.00
somex.com $4,155.00
ekai.com $4,010.00
02c.com $3,900.00
fenla.com $3,878.00
reinventors.com $3,867.00
payroll.net $3,743.00
investorclub.com $3,600.00
winlotto.com $3,411.00
r26.com $3,400.00
avsabonline.org $3,400.00
u-o.com $3,350.00
novacap.com $3,333.00
y48.com $3,311.00
333221.com $3,200.00
hybridvehicles.com $3,125.00
52865.com $3,099.00
easycoffee.com $3,026.00
fqcp.com $3,020.00
icec.com $3,002.00
salestech.com $3,000.00
zhujia86.com $3,000.00
egreeting.com $2,950.00
uncalculated.com $2,933.00
trowbridge.com $2,900.00
brandery.com $2,800.00
diplomacy.org $2,710.00
2200.net $2,702.00
51636.com $2,700.00
french.net $2,601.00
backuppower.com $2,601.00
facon.com $2,601.00
auditing.net $2,600.00
ebec.com $2,600.00
parilla.com $2,600.00
roofadvisor.com $2,600.00
espiritosanto.com $2,595.00
persians.com $2,522.00
neworganizing.com $2,522.00
curlers.com $2,501.00
l19.com $2,500.00
btcbiz.com $2,452.00
safetymanagement.com $2,350.00
chicken.net $2,322.00
proteindrinks.com $2,300.00
27939.com $2,300.00
sapin.com $2,300.00
globalworks.com $2,288.00
72389.com $2,210.00
cpjj.com $2,200.00
vrrx.com $2,200.00
geeb.com $2,200.00
toxicologist.com $2,200.00
sj1.com $2,112.00
carenavigator.com $2,108.00
greekgod.com $2,105.00
realtorwebsites.com $2,101.00
pinkshop.com $2,100.00
greatproperties.com $2,099.00
atomicpower.com $2,070.00
767676.com $2,021.00
sj2.com $2,010.00
childrensclothing.com $2,000.00
d45.com $2,000.00

 

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dot-com

It’s a question my startup founders ask themselves – do I need to spend a bunch of money on the .COM or am I okay with a .CO, .ME, .IO or any other popular .COM alternative. This is a very polarizing topic as I know some startup founders that will only brand on a .COM, and others who think it’s ridiculous how many people are “squatting” on .COMs and they don’t want to spent more than the registration fee on a domain.

That being said, I think a lot of people are stuck in the middle – they want a .COM, but might not have the budget and still want to brand around a specific word or combination of words. Here’s an example.

intercom-logo-png

When the startup Intercom started, they definitely didn’t have the budget for a big one-word .COM like Intercom.com. Now, having raised $115M, yes 115 million, they upgraded to the .COM. What’s important to remember is, big one-word .COMs like Intercom.com sell for six or seven figures, so in the early days this is typically well outside of a startup’s budget. While I agree – yes, without a doubt upgrading to the .COM is easily worth seven figures for a company like Intercom that has raised over $100M, did they make the right more first building their brand on the .IO?

In this case yes. By building their brand as “Intercom” and just doing it on a .IO they did not have to ever go through the rebranding process, and once they could afford the .COM they bought it and didn’t have to change their name. I also know that Intercom was able to raise over $10M while still rocking a .IO domain so it clearly didn’t hurt them that much in the early days when it came to acquiring customers and raising money.

keen-io-logo

Here’s a similar example, Keen.io (who calls themselves Keen IO) has raised close to $30M and continue to brand around the .IO. You can’t raise close to $30M without some serious customer traction so in this case, like Intercom, the .IO doesn’t seem to be holding them back, but I’m sure as they still want the .COM.

The question is, should a startup build their company around the brand name that they want, i.e. Intercom or Keen, or pick their second or third choice brand name but build it on a .COM. A lot of companies choose to take a hybrid approach that I’m not a huge fan of, adding the word “get” to the front of the name or “online” at the end of the name in order to brand on a .COM.

Still I think that’s a weaker option. I think Intercom.io sounds a lot better than GetIntercom.com or IntercomOnline.com, and I also think it’s a much smoother transition to go directly to the .COM later down the road. Yes, you could always say that someone could come along and build a competitive product on the .COM if you don’t have it, but most startup founders know that building a product and raising millions in venture capital isn’t a trivial task. It’s why nobody signs NDA when talking about their ideas, you can steal an idea but remember only 1% of startups are successful and that’s because of execution.

There are tons of examples of startups who build their brand on a non .COM and then later down the road spent the six or seven figures to acquire the .COM. The question is, when is it safe to make this move and when is it foolish? For every Intercom and Keen IO out there, there’s also a graveyard of startups who branded on a .IO or another non .COM, never raised any money, and poof, the domain shows up on Park.io available to buy for under $100.

What do you think? Comment and let your voice be heard!

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learn domain investing

When I first got started in the Domaining world back in 2007 I was like most new investors. I saw a list of domains that had recently sold, got excited, and started hand-registering domains like crazy. So, yeah – that was the first time I lost a meaningful amount of money in the domain world. It was painful, as Rick Schwartz would have said himself if he saw my portfolio, I had bought a bunch of pigeon shit.

After going to my first domain conference and meeting other Domainers that actually knew what they were doing I learned something that has stuck with me. Pay attention to what the seasoned Domainers are doing, it’s the best way to learn. Also just to be clear, I don’t consider myself to be a seasoned Domainer, I’m a startup founder who invests in domains rather than stocks or real estate. Don’t take the fact that I have a blog where I write about domains, eSports, venture capital, etc. to mean I’m an expert in any of these things – I just write about what I’m interested in.

I have never been a full time Domainer, never will be, for me I see domains as a better investment vehicle than real estate or the stock market. For me domain names has always been about investing, not about developing a career. Of course, domain names can be a lot more than an investment strategy, I know many people that have become millionaires by buying, selling, and brokering domain names full time.

Doing anything full time means you’ll have the time to excel more than just about anyone that just does it part time. But you better love it…because that’s your full time job. For me, I’ll be honest, I’ve never loved it that much, I see domains as an investment vehicle that has without a doubt changed my life, but isn’t something I want to devote all day, every day to. My interests are in technology, and building innovative software that changes the way people do things. I helped to do it once at Sonos, and we’re doing it now at Bold Metrics, and it feel amazing.

So back to the title of this post. Do you pay attention to what seasoned Domainers are buying and selling? If not, you should be. Honestly I think I’ve learned the most about investing in domains just to talking to and watching full time Domainers, the people who put in WAY more time than I do. Here are two examples from this week that caught my eye thanks to this blog post by NamePros.

Garry Chernoff purchased UrbanStudio.com for $1,966 via NameJet

Braden Pollock purchased the four-letter domain Spew.com via NameJet. According to NameBio, the price was $4,204.

Let’s look at just these two purchases in a vacuum. First, if you don’t know Garry, he’s sold a lot of monster names (like Drink.com for $500,000) and he’s been doing it for a long time. What’s interesting about UrbanStudio.com is that I think most new Domainers wouldn’t blink an eye at a name like that, and once it got over a few hundred dollars, many people would drop out.

That’s what makes a long-standing veteran so different. I can tell you that Garry sees ~$2,000 as a pretty solid wholesale price for the name, and if he flips it my guess is we’ll see it selling the $35k+ range. It’s safe to say that Garry is planning on making more than a 10x ROI on the purchase. Yet so many people would think, oh well I could probably buy that for a few hundred bucks and flip it for $3,500. You can think that way (and I do a lot of the time) and still make good money, but people like Garry are thinking bigger.

The same is true with Braden and Spew.com at $4,204. Just like Garry is looking at his purchase as a wholesale buy, so is Braden…and given that four character .COMs like Lola.com sold for $550,000 this year, I’d say that’s a pretty good bet.

While we all of course should develop our own strategies and methodologies, looking at what other Domainer who are ahead of us is one of the best ways to learn in my opinion. The challenge is breaking away from the habit we all have as humans – buying things that we like, and changing your perspective to buying something that you think someone like Garry, Braden, Frank, Rick would buy.

What do you think? Comment and let your voice be heard!

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