Domain Name Buyer Broker Can Help Buy Domains | DomainInvesting.com

Domain Name Buyer Broker Can Help Buy Domains

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When I think of a domain broker, my first thought is that these people represent the owners of domain names who are looking to sell them. There are also brokers that specialize in representing companies and people who need to acquire a domain name. These domain name buyer brokers serve an important role in the facilitation of domain name deals.

Over the course of a year, I receive quite a few requests from people to help them acquire a domain name. I almost always recommend that these people work with a domain broker to purchase their domain name. I want to share some of the reasons why I suggest this, and I asked three domain name buyer brokers to offer their thoughts. Adam Strong of Evergreen, Bill Sweetman of Name Ninja, and Alan Dunn of NameCorp all shared their insight about using a domain name buyer broker.

Setting expectations – Many people have no idea what a domain name in the aftermarket will cost, and a broker can help set expectations. “A Buyer Broker can help a client understand what sort of budget is realistic for their domain acquisition,” Bill Sweetman told me. “Buyer Brokers should have an extensive understanding (and access to data) of what comparable domain names have sold for and are currently selling for,” he continued. This can ensure that the buyer has the budget for the domain name that is desired. Setting expectations at the outset is important, otherwise it could waste everyone’s time.

Pricing – I would imagine most domain owners’ prices are dynamic. If they are having a good quarter or year, the prices of their key domain names may be higher. Likewise, if a major corporation inquires about a domain name, the price quote for the domain name may be significantly higher than if someone random were to inquire. A domain name buyer broker can likely get a price from a domain owner that is more about the value of the domain name than the size of the buyer’s treasury.

Negotiations – A buyer broker is generally very experienced in negotiations and has a deep knowledge of domain name values and negotiation strategy. According to Adam Strong, “experience gives the broker the knowledge to evaluate a domain name and quickly assess market value and price expectations based on the domain owner.” Buyer brokers tend to know the major domain owners and companies in the space, and they are able to help create an acquisition strategy based on this experience. Adam told me that “an experienced broker will also have the knowledge to help guide a buyer through different scenarios to provide the best options for the client. This experience provides invaluable guidance to clients in a variety of situations such as tracking down a domain owner, engaging an unresponsive domain owner, finding alternative names, creative deal structuring, and insuring transactions move efficiently.

Privacy – For many buyers, remaining private is a priority. Some domain name acquisitions could tip their strategic hand to competitors or the general public, and this attention may harm the company. Even a failed negotiation could become public. In addition to this, there are other considerations about remaining private. Bill Sweetman shared that “a good Buyer Broker will manage the purchase and transaction from start to finish, hiding the Buyer’s identity and protecting the Buyer’s money throughout the entire process. This eliminates the risk of fraud and theft.” Using an escrow service like Escrow.com, Escrow.Domains, or even a law firm’s escrow account, will help reduce the risk of fraud and theft.

Relationships – Perhaps the most overlooked aspect of using a buyer broker is that they have relationships with many of the largest portfolio owners as well as many individual domain investors who own some of the most desirable domain names. “A good Buyer Broker will have established strong business relationships with those companies along with dozens of mid-tier domain speculators,” Bill Sweetman told me. “This trust factor helps ensure a timely response to purchase inquiries,” he continued. A buyer broker knows the decision makers for many large portfolio owners, and perhaps most importantly, the broker knows how to get in touch with that decision maker.

Emotion – If you’ve been involved in a difficult negotiation before, you know that emotions can play a role. The opposing party may push buttons or make comments that annoy or anger you. This can make a person more emotionally vested in a negotiation, and that can work against him. Alan Dunn told me that “the most important part of any negotiation is to remove the emotion from the deal. Hiring the right broker allows parties to focus on the value of the asset, and not the value of the buyer’s wallet.

Alternatives – If the domain owner is unwilling to sell the desired domain name, is unreachable, or the price is beyond the budget of the buyer, a seasoned buyer broker can present alternative domain names to the client. “Clients often come to the table with a dream domain name that they quickly realize is outside of their budget,” Adam Strong told me. “In these cases, we can assist them by putting together lists of alternative name concepts within their budget,” he continued.

I would imagine that 8-9 figures worth of domain name sales are transacted annually with the assistance of a domain name buyer broker. “Many of the world’s finest acquisitions are purchased through a proxy or broker, including domain names,” Alan Dunn told me. I use DomainTools to track hundreds or maybe thousands of the best domain names, and I regularly see names that change hands without any fanfare. I believe that many of these deals involve a domain name buyer broker, and they typically fly below the radar.

It can be very helpful for a domain name buyer to use the services of a domain buyer broker for the reasons outlined above. Hiring a buyer broker can help a buyer track down a domain name owner, negotiate a fair price, and facilitate a sale.


About The Author: Elliot Silver is an Internet entrepreneur and publisher of DomainInvesting.com. Elliot is also the founder and President of Top Notch Domains, LLC, a company that has sold seven figures worth of domain names in the last five years. Please read the DomainInvesting.com Terms of Use page for additional information about the publisher, website comment policy, disclosures, and conflicts of interest.


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Comments (8)

    Bruce

    Excellent article and illustrates how brokers really do their job. Many have the perception brokers go to whois and contact the domain owner and that it is easy money.

    Many deals take weeks and sometimes months to secure a buyer-seller agreement.High-value names often require legal documents between the parties. Also financing structured deals take time.

    The dip in sales to China has made a brokers job 10-times harder now. Not because the buyers are not there! It is harder because domain name owners still want to obtain unrealistic prices for their domains.

    May 20th, 2016 at 2:03 pm

      Jeff Schneider

      Being on the other side of the coin,We owners feel the brokers want owners to accept low ball offers so they can close the deals. Its a back and forth tug of war and if you cannot stand the heat of negotiations that comes with brokering valuable assets maybe brokering is not every ones cup of tea.

      Gratefully, Jeff Schneider (Contact Group) (Metal Tiger) Former Marketing Analyst/Strategist Rockefeller IBEC Group) (Licensed CBOE Commodity Hedge Strategist)

      In reply to Bruce | May 21st, 2016 at 2:48 pm

    YamadaMedia

    I’ve dealt with time wasters a lot. I Will start charging people a fee upfront. Except the fee is donated to a local animal shelter.

    If advice/time isn’t worth a donation to needy animals… I don’t want to work you or your company anyway. :)

    What happened to DomainGuardians?

    May 20th, 2016 at 4:42 pm

    Jeff Schneider

    Great Points Elliot,

    We might add, Most all domain brokers are opportunists, like you and I, and will play both sides of the transactions as dual agents if the domain is super valuable. Ultra-Premium Asset Class Domains Breed Greed.

    Gratefully, Jeff Schneider (Contact Group) (Metal Tiger) Former Marketing Analyst/Strategist Rockefeller IBEC Group) (Licensed CBOE Commodity Hedge Strategist)

    May 20th, 2016 at 11:42 pm

    Bill Sweetman

    @ Jeff

    I don’t know which domain brokers you are referring to however professional domain buyer brokers like myself (and my two esteemed colleagues Adam and Alan) only represent one party in a transaction: the buyer.

    We would never “play both sides of the transaction” because that’s a huge conflict of interest.

    It sounds like you may have had a bad experience with one or several less ethical “brokers”. Please don’t paint every broker with the same brush.

    May 21st, 2016 at 12:27 am

      Jeff Schneider

      @ Bill,

      Brokering a deal is representing both parties in all transactions.The broker as you well know talks back and forth to BOTH PARTIES and it is a mistake to think otherwise. If your not playing both sides you are not brokering, its as simple as that.

      Gratefully, Jeff Schneider (Contact Group) (Metal Tiger) Former Marketing Analyst/Strategist Rockefeller IBEC Group) (Licensed CBOE Commodity Hedge Strategist)

      In reply to Bill Sweetman | May 21st, 2016 at 2:08 pm

    Bill Sweetman

    @ Jeff

    As a buyer broker, of course I *talk* with the seller in the course of facilitating a transaction, but ultimately I only serve one master: my client, the buyer. Why else would clients hire me? They want someone skilled representing their best interests, someone in their corner they can trust.

    Your “playing both sides” comment sounded like you were saying most buyer brokers double-dip (i.e. are compensated by both buyer and seller on the same deal). I believe that is unethical behaviour and I would never do that. Trust and integrity are paramount to the way I operate, and the people I do business with know and respect that.

    May 21st, 2016 at 3:05 pm

      Jeff Schneider

      We agree with you Bill

      As to your interpretation of my comment (playing both sides) you took it negatively and not literally. We have brokers in our group, including myself, that are very experienced in the art of back and forth negotiation.On average most brokers want low ball valuations. As to your comment that you would never compromise your fiduciary responsibilities,thats great for your sake, but sadly you are in the minority.

      Gratefully, Jeff Schneider (Contact Group) (Metal Tiger) Former Marketing Analyst/Strategist Rockefeller IBEC Group) (Licensed CBOE Commodity Hedge Strategist)

      In reply to Bill Sweetman | May 21st, 2016 at 4:08 pm

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