BrandBucket

It’s no secret that BrandBucket has been a major player in the brandable domain name space. Over the years I’ve had the chance to meet the founder and some members of the team and I’m always inspired by our conversations. BrandBucket really is a company build for entrepreneurs by entrepreneurs.

While I’ve used BrandBucket for a long time now, I learned something new a couple of weeks ago that I thought was pretty interesting and worth sharing with all of you.

As most domain investors have seen, the domain liquidation space has grown a lot over the last year as investors look for more ways to get liquidity. While you’re not going to get close to end-user pricing from domain liquidation services, you are going to usually end up with more than your renewal fee, which when compared to $0 if you drop the domain, is pretty darn good.

Well like the title of this post says and as I hinted at above…BrandBucket has their own liquidation service for domain owners that want to sell domains they have on the platform, directly to BrandBucket. The formula for determining how much BrandBucket will pay for the domain comes out to roughly 1% of the suggested price minus $9.

To walk through an example. Let’s suppose you have a domain at BrandBucket listed at $4,500. You’ve had the name for years, and it’s getting the axe when renewal time comes around. Well rather than dropping the name you could sell it for $36 right away. While that might not sound like much, the sweet spot for liquidation (from what I know) is in the $25 – $50 range, which once again is a lot more than $0.

This was news to me and a pretty nifty feature from BrandBucket IMO πŸŽ‰

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Ah the world of outbound domain sales, something you need thick skin for and a healthy dose of persistence. One of the rising stars in the domain outbound world is Yogi Solanki, if you don’t know much about him yet feel free to check out this interview I did with him over the summer.

Yogi has been on a roll this year doing outbound and given the volume of emails he’s sending he’s been able to get a feel for what works and what doesn’t. Today on Twitter Yogi dropped some knowledge when it comes to email do’s and don’ts that I thought you’d all enjoy:

Domain Outbound Ideas

While I personally don’t have the time to do outbound, I do enjoy watching people who do and living vicariously through them 😊 If you decide that you want to try your hand at outbound, there’s no reason to repeat the same mistakes that others have learned from so data like what Yogi shared today can be pretty darn valuable.

One of the “don’ts” that Yogi shared that really resonated with me is the “this domain is short & very catchy” comment. I’ve always thought this never made sense when you’re trying to sell a domain. At the end of the day, if someone wants to buy a domain from you, they should hear the domain and find it catchy, brandable, etc. if they don’t – you saying that it is certainly isn’t going to mean anything to them.

I think it’s great that Yogi is giving back to the community by sharing data like this – thanks Yogi and keep it coming! πŸ™Œ

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Okay, so I’ll start by making sure you see the word “might” in the title of my post which means, I have no data to back this up, I’m just sharing a theory. Like most domain name investors, I have my domains listed on a variety of different marketplaces and I’ve often wondered if reducing prices on some of my domains would increase liquidity.

What made me think of this is a feature that currently exists on Squadhelp that allows you to offer a discount on your domains, here’s a quick look at what the feature looks like:

Squadhelp Domain Discount

Now I’m not 100% sure if this feature does what I think it does…but I believe it notifies people who have shortlisted your name and notifies them that the price has been reduced.

I don’t know how many marketplaces offer a feature like this, i.e. for a buyer to shortlist and name and potentially stay in the loop if the price changes, but I think it’s a great idea. I’m going to experiment with it a bit and I’ll let you know how it goes. I have a good selection of names now that have been shortlisted by potential buyers and I’m curious if reducing the price here and there could stir up more interest, we’ll see.

That being said, and back to the title of this post, my guess is that if you want to adjust your pricing to sell more names, that means reducing the price of your names, increase the price probably won’t bring more buyers.

Over the years I have increased pricing on domains that I see get strong inbound interest or that I see similar names selling for a lot more. So by no means am I saying that you should just discount your whole portfolio to reduce liquidity, in fact, I think if you don’t have at least a handful of names that you’re “shooting for the moon” with – you should give it a go.

I do think though, if you want to increase liquidity that either reaching back out to potential buyers directly with a discount, or updating on a marketplace that will notify them could make a difference. Of course, like I said in the first sentence, I have no data to back this up so I’ll just have to experiment and see what happens. As usual, whatever I learn I’ll share with all of you!

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Private Domain Sale

Well here’s an interesting one. Today Domain Investor Arif Sengoren shared a little background on a recent domain acquisition he made on behalf of a client. They bought a domain for $6,500 which was originally priced at $9k and asked the seller if they’d be okay keeping the sale private, the seller’s response? Sure – but it’ll cost you $2,500.

Feel free to click on this tweet to read the whole thread but this is a tricky one to analyze. As you’ll see from the tweet, the seller did reduce their price by $2,500 since the name was originally priced at $9k. So it’s not the case that this particular seller always charges $2.5k to sign an NDA, instead they’re really saying – if you wanted the sale private you should have paid full price.

Josh Reason and others jumped in the thread to share their thoughts, here are some highlights:

I think what Keith said, is probably what was going through the sellers head, “if you had paid full price I would have given you whatever you wanted but a discounted price doesn’t come with special favors.”

At the same time I have to say, for myself, if I was the seller, I probably would have been fine with keeping the sale private and wouldn’t ask for $2.5k. My thinking here is that I’d rather just be an easy person to work with and encourage someone to do business with me again in the future. If this was a landmark sale that I really wanted to hang my hat on, maybe I’d fight to keep it public, but at $6.5k it doesn’t seem like a big deal.

What would you have done in this situation?

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Domain mistakes startups make

Yesterday I wrote a post on my friend Matt’s blog talking about three things startup founders should know before buying domains, you can give it a read here if you’re interested.

Today I wanted to highlight the first point I made in that article as it’s one of the most common mistakes I see startups make and it’s a painful one. First things first, let’s talk about cybersquatters.

I can’t stand cybersquatters, they’re the scum of the Internet. Cybersquatters buy domain names that use someone else’s trademark in them so they can make money off of someone else’s work. Here’s a good example. Let’s suppose you start a company called “Morgan Software” you’ve got a Trademark on the name and you’ve been running it for years on MorganSoftware.com. Then you get an email from a client, someone bought MorganSoftware.co and put up a confusingly similar site, they’re trying to benefit from the hard work you’ve put into building your brand.

In this case, you could file a UDRP, a process setup to stock cybersquatters in their tracks, and legally get them to stop and take back this domain that really should be yours.

First a little primer on domain investing

Just like people buy physical real estate, hold it, and sell it for a profit, the same is done with domain names and has been for 20+ years. Entrepreneurs from some of the most well-known startups in the world own domains for investment purposes, big companies like Google and Microsoft hang onto some very valuable domains, and individual investors (like me πŸ™‹β€β™‚οΈ) also invest.

Domain investing is focused on buying generic domains that don’t infringe on anyone’s trademarks. A couple of weeks ago NAS.com sold for $720,000 and earlier this year Palace.com sold for $306,000, Kick.com went for $276,0777, and Results.com sold for $264,000 (Source – DNJournal). One-word .COMs typically sell in the six figure range, but they can and do sell in the seven figure range and sometimes even the eight figure range like Voice.com which sold for $30M last year.

Given that one-word .COMs usually carry at least a six-figure price tag, many startups find themselves in the two-word .COM or one-word .IO, .AI or .CO camp, especially as they’re just getting started. A one-word non .COM can often sell for 1/5th – 1/10th of what it’s corresponding .COM would sell for.

Last month Sun.io sold for $49,995 and two months ago Jackpot.io sold for $48,500 (Source – NameBio), I can tell you – Sun.com would very likely be a seven figure sale and getting it for $500k would be one heck of a deal so you can see how a name like Sun.io at $49,995 makes a lot of sense.

So how much should startups spend on a domain?

I’ve spoken with a number of VCs I know here in SF and many of them have shared a general rule of thumb specific to consumer-facing startups – founders should be okay spending ~10% – 15% of their raise on a good domain name. So for a startup that raises a $3M Seed round (pretty common Seed these days) a budget of $300,000 – $450,000.

Pre-Seed startups likely won’t have a six-figure budget for domains and if you raised $500,000 spending more than about $50k on a domain name could be painful. This is where two-word .COMs are a great bet or one of the many new gTLD options which you can often find solid names in the sub-$10,000 range. There are plenty of startups with lots of funding that still are more than happy to brand on non .COMs, Zoom is one of the most well-known which stuck with Zoom.us until it was well into unicorn status πŸ¦„

Okay – so what’s the big mistake startups make?

The biggest mistake I see startups make when they go to buy a domain name is thinking that just because last month, or even last year, they decided to call their company “CompanyName” they are somehow entitled to CompanyName.com.

I’ve seen cases where companies like Google own the name and the startup demands that Google gives them the name since they aren’t using it. In other cases I’ve seen startups make a huge mistake and try to steal the domain name from its legitimate owner abusing the UDRP process. When this happens, the rightful owner can file a RDNH (Reverse Domain Name Hijacking) claim and you might even find yourself in the Hall of Shame, a public database of people who have tried to steal domains from their owners.

Remember, startups are buying one-word .COMs for six-figures literally every week. If you think you can get one for $10k, $15k or even $50k from someone who owned the domain ten years before you even thought of starting a company…think again. Don’t make this mistake because if you do file a UDRP, get hit with RDNH and end up in the Hall of Shame, you’re not only ruining your chances of getting the domain, you’re also hurting your reputation online.

Just like I wouldn’t show up at your parents house and ask them to sell their house to me for the price they paid in 1960’s, asking a domain owner to sell their domain name for pennies on the dollar doesn’t make sense. If there is a big juicy name you want but can’t afford yet, just be honest with the owner. Many domain investors offer flexible leasing options and some will even take a combo of cash and equity combined with a pay over time option that can make a deal possible sooner than you’d think.

There’s no doubt that a good domain name makes a huge impact on your business. For consumer-facing companies it can be a make-or-break and for new brands it can give instant credibility. I always believe you should treat people the way you would like to be treated, a little kindness can go a long way. So if there’s a domain name you want, first – make sure you’re thinking logically about how much it’s actually worth (i.e. if it’s a one-word .COM, expect a six-figure price tag, a two-word .COM, sure $2,500 could work!) and then do the right thing and approach the owner and treat them the way you’d like to be treated.

And there you have it – if this helps one or two founders get the domain of their dreams I’ll be a happy camper! πŸ• Of course I’m always open to questions, comment, suggestions, you’re welcome to share away in the comment section below.

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Compound.finance

Okay, let’s be honest, finance can be a pretty boring world. I have friends that have worked in finance for years and they all typically say the same thing, love the money, the work, eh – kinda boring.

When you think of traditional, slow moving industries banking and finance is right up there with apparel and energy. All huge industries, but not famous for moving quickly or going out on a limb with innovation.

All that being said, the big boring world of finance is being disrupted by a new set of startups that aren’t afraid to move quickly, innovate, and challenge the status quo. The name for this emerging sector is DeFi which stands for Decentralized Finance and one of the leaders of the pack is Compound.finance, a startup backed by some of the biggest Venture Capitalists in the world like Andreessen Horowitz, Bain Capital, and more.

I recently came across a list of the top DeFi companies organized by category, and holy moly, it’s pretty nuts to see how much this space has exploded over the last couple of years 🀯

DeFi Pulse

As I went through, the list I saw that .FINANCE definitely seems to be popular with DeFi startups and in general, non .COMs represent more than half of the domain extensions.

When I think about someone like Compound.finance, I can understand why they might prefer this to something like Compound.com. Sure, there’s no argument that Compound.com is a great domain, but Compound.finance provides additional context to the brand. We’ve seen this with the explosion in both the .AI and .IO space as well as startups are frequently using what comes after the dot as a core part of their brand.

I could see Compound.com being used for a wide range of applications from medical to finance, social to gaming, but Compound.finance, yeah – I know that’s a finance company. With investors pumping over $33M into the company it’s also clear that Venture Capitalists are also a-okay with these new domain extensions as well.

Of course, these are still the early days, there’s always a chance that every new gTLD fails and twenty years from now every market leader is on a .COM…but something tells me twenty years from now we’ll see online branding continue to change and evolve, and this just might be an early look at where it’s going πŸš€

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Expired domain auction

When I talk about Park.io I’m usually talking about some juicy .IO domain that investors (myself included) are drooling over 🀀 But today is different as .CO takes center-stage with some pretty exceptional names dropping right now.

I’m not sure if a .CO investor decided to move away from .CO or if there’s just something in the air but I’m excited and will likely be bidding on a couple of these.

Here’s some of the names in auction right now:

  • Triangle
  • Concierge
  • Telepathy
  • Strata
  • Advanced
  • Collateral
  • Outperform
  • Swagger
  • Classy
  • Webinars

While Park.io is a sponsor of this blog (they rock 🎸) there’s no affiliate links here so whether someone buys a name or not, I don’t get a penny. Right now Triangle has taken the lead just above $1,000 but I’ll be interested to see how these go.

The top .IO name right now is Ruler.io at $369 followed by Agave.io at $227. My favorite .GG name on there is Sage(.)gg but I had to tap out as the price went over $500, I like the name but I keep buying .GG names without selling any so I don’t want to go too crazy yet 😜

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Efty Marketplace

2020 has been a big year for Efty with a ton of new features and enhancements coming to what has already been a pretty full-featured solution IMO. That being said, there’s always been one big move in Efty’s future – creating their own marketplace.

I’m excited to say, today is the day, Efty’s new marketplace is live and I just had a chance to do a deep dive and like the title says, it’s pixel perfect, I think I’m in love ❀️

Efty Marketplace Spotlight

I really like how clean the UX is in Efty’s new marketplace, and the use of lighter pastel colors really makes it feel crisp, calm, and organized. Here’s a bit more from Efty’s blog post today:

The Efty.com marketplace is a extra service to our users at no additional costs and won’t replace the features that you know and love such as customizable For-Sale landing pages, Live Chat and your own marketplace.

Offers submitted via Efty.com will be emailed directly to the seller with full contact details of the buyer such as email address, phone number and IP address. Buy-It-Now transactions on the new marketplace are supported by Escrow.com and DAN.COM.

(Source – Efty blog)

Efty sellers can also now redirect their domains to SSL secured landing pages on Efty.com and just like the marketplace, these new landing pages are sport a nice clean UX and refreshed look with a bio block adding a nice personal touch.

Efty Landing Pages

I’ll be updating my landing pages this week and for others who want to do the same you can simply change your redirect settings here (note you need to be logged in to do this, duh!).

This is a big move for Efty, it is clear the company really thought about how to really nail the UX for a domain marketplace and I think this will attract a lot of end users. Congrats to the whole team and hey, congrats to me and all the other Efty users, this is a big win for all of us πŸŽ‰

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Buying Domain Names

On Friday I wrote an article about a domain sale made by domain investor Logan Flatt. For those who haven’t read the article the headline reads:

“NoMatterWhat(.)com – from $360 purchase to $22,999 sale with Logan Flatt”

I knew the purchase price of the domain because Logan shared in on Twitter. This sparked a good conversation on Twitter that I thought I’d carry over to my blog.

Another domain investor who I respect, Keith DeBoer brought up the following point which definitely got me thinking…

Reporting domain purchase price

I’m glad Keith brought this up as I think it sparked a pretty interesting conversation on Twitter. The point he makes is pretty solid – “it feeds the perception that domainers are opportunists who ripoff end users.”

While I always like writing about domain sales with insane ROI, it might be something that could rub people the wrong way. I mean, if you think about just about any other space, say real estate, while you might buy a house and sell it for a 2x or 3x ROI, there’s no chance you’re going to sell it for an 100x ROI and do that over and over again. And on that note, if you did sell someone a house for 100x your purchase price, and they didn’t know what you bought it for, yeah – they might feel like they got ripped off.

Josh Reason from Josh.co shared his two cents and I think he said it well:

Sharing domain ROI

The conversation continued and honestly, since both Keith and Logan are such standup guys, it was a totally fair and level-headed discussion. This is one thing I do really appreciate about the domain industry, outside of a few bad apples that might troll a conversation, for the most part people are kind, open-minded, and interested in hearing different opinions!

After reading through this thread on Twitter and taking more time to think about it myself, I think I’m probably going to stop writing articles where I share the purchase price and sale price of a domain. As a public media source my blog is read by plenty of normal people who aren’t in the domain industry and as I think about it more, I don’t think I’m helping the perception of domain investors when I write articles like the one I did on Friday.

That being said, I do think it’s up to each domain investor and media outlet to decide what is best for them. For me, I always want to do everything I can to show the world a positive perspective on domain investing and I think this discussing really helped me think through this a bit more. I don’t think there’s really a right or wrong answer here, but I’m always interested in hearing different perspectives and changing my tune if I think there might be a better approach for me.

Thanks for the great discussion everyone, it was a good one to have. Of course I’m interested to hear what you think about it. If you didn’t already join in on Twitter feel free to share your thoughts in the comment section below. Comment and let your voice be heard!

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NoMatterWhat-Com

There’s nothing I love more than seeing good, talented, hard-working people succeed. I’ve known Logan for probably a decade or longer now (maybe he can remind me!) and it’s been awesome to watch him thrive in the domain investing world.

What Logan was able to show early-on is a good eye for brandable domains that resonate with end users. His most recent sale, NoMatterWhat(.)com is yet another example of Logan in action.

As he mentions in his tweet, Logan originally purchased NoMatterWhat(.)com for only $360 back in 2011. While my guess is he likely could have sold it for a few thousand dollars much quicker, Logan waited and well, it was clearly worth the wait.

Logan also shared a bit more detail about the sale. The domain was actually listed for sale on Squadhelp for $26,436 and an offer came in for $15,000. Logan set a floor at 80% of his BIN and Squadhelp brokers captured the 7% discount, a 13% discount to BIN.

As for who bought the name, it looks like a marketing agency picked up the name for a client which means there’s a good chance we’ll likely see this name in action in a TV commercial or online ad before we know it. Congrats to Logan, nicely done and as always thanks for sharing with the community!

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