I got a very nice email early last week from someone who had discovered my blog and wanted to get started investing in domains. He had read some of the articles that I had written about not rushing in and taking time to learn the business and wanted to hop on a call to discuss more.
When we got on the phone, the person told me about how he had lost his job and was looking for a way to generate some income. He wanted to do something that would start making him money in 1-2 months. Most of his savings had been spent and he was getting ready to put the last of it into domain names.
After explaining his situation he went on to discuss how he had become inspired by my blog and a few others and wanted to get started. This is where I stopped him, it wasn’t the right fit, it’s not the right way to get started, so I told him – “I would not recommend Domaining as a path for you right now.”
I explained that Domain Investing is great for people that already have a stable income source, have money to invest, and are looking for options outside of the stock market. While you can definitely build-up an incredible business in the space, a few months won’t cut it and depending on your budget it can take years to learn the important lessons you need to make money in the space.
I wasn’t trying to crush a dream here, or paint a negative picture about Domaining, instead I wanted to be completely honest. It can be all too easy for people to look at a list of domain sales and think, “I can buy a bunch of domains, sell them for a huge profit, and cash in!” In fact, I think it is this path that most of us take when entering the space. I personally bought over 1,000 domains when I started and dropped over 600 my first year.
There’s a learning curve and I tell anyone that wants to get involved in the space that it won’t happen overnight, it’s not a great way to get rich quickly, but the potential is incredible, if you do it right. The thing is, as I said above, most of us don’t do it right in the beginning which means burning through hundreds, thousands, or tens of thousands of dollars learning the business.
If you have money to invest and are looking for a way to make more money that you would in the stock market domain names offer that opportunity. However, just like investing in the stock market or real estate, you have to take the time to learn. My best advice to anyone that wants to get started is to read as much as they can and then go to a conference and begin networking. Don’t buy a million names, just learn and begin forming a proven strategy that you yourself want to follow.
So what was the end result of my call? I recommended that the caller finds a job and gets back on their feet. During this time they can still read all about Domaining, follow case studies, watch interviews on sites like DomainSherpa, and really get some greater depth in the space.
Then, when they have gotten to a comfortable place financially and have additional money that they want to invest, then they’ll be ready. At the end of the day I feel like I probably saved that guy thousands of dollars. To many people this might be a drop in the bucket but to him this was the rest of his life savings.
I love Domaining and am unbelievably proud of building a success business in the space. I love inspiring new investors and teaching people what I have learned. At the same time, I think we all have the responsibility of being realistic with people and making sure they understand all the risks associated with this business and the incredible learning curve that most people have to go through.
In my book (Domain Investing Handbook) I make this point resoundingly clear right-away. Let’s face it, most Domain Investors start-out as Domain Collectors, there’s nothing wrong with this, but make sure you’re realistic with yourself and your expectations. Domaining is not a get-rich-quick scheme, it is a complex investment strategy, and in my opinion, the best way to own one of the most valuable asset classes on the planet. You can build-up a five, or six-figure income with Domaining but you have to do it the right way, and at the right point in your life.