Every Investor Has a Different Strategy
101 Domain

Every Investor Has a Different Strategy

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There are a whole lot of sources to learn about investing in domain names, much more so than years past. There are individual bloggers (and people who comment on blogs), websites that discuss domain names, and various people on domain forums. There are also various tools to track what some of the bigger domain investors are doing with their own portfolios.

With all of this information available to domain investors of all stripes, it’s important to remember that we all have different investment goals and strategies, and you need to keep that in mind when you read about various transactions and tactics.

When I hear about some of the most successful investors making huge sales, it gets me excited. It’s thrilling in a way to hear about a $100,000 offer that was turned down and later turned into a $250,000 sale, all for a name that was bought at auction for a couple thousand dollars.

That said, many of us couldn’t afford to gamble on a $100,000 offer. We would be happy with a 40x ROI and would move on to the next domain name. It’s great to read advice and hear how others maximize their returns on domain sales, but for many of us, that isn’t reality.

We all need to be mindful that our business models are very different from each other, despite the fact that we operate in a small industry. Some of us make the majority of our revenue through parking, some through infrequent (but large) domain sales, some through frequent (but small) domain sales, and others through web development or hybrid models. Our business models may look similar, but they are very different.

When you (and I) read about people using different tactics and strategies to buy, sell, and monetize domain names, we must also look at the person who is discussing these ideas. Their business model may appear to be similar to ours, but in reality, it’s a very different model that works differently.


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 (3)

    L

    I agree. Different strategies for different portfolio types, too.

    For every one loud and proud story of someone holding out for the grand slam, there are ten, perhaps one hundred others of deals that were missed, profit that was lost because greed took over.

    There are a tiny handful of people who have the types of portfolios that can sustain a ‘swing for the fences, every time’ approach. Most do not, and even among those who do, I’m convinced that if we had a magical “What if?” god camera that showed the optimal outcome for every domain inquiry, several are probably running at a theoretical net loss, given the volume of money they’ve left on the table over the years for the sake of whatever satisfaction they get from making the one, big hit.

    The closest thing I can liken it to was an old pawnbroker I knew. I collected guns back then and was an occasional buyer in his shop. The guy was a total scumbag and eventually went out of business. He used his operation to derive personal Schadenfreude satisfaction from screwing desperate people, rather than the much more profitable model of simply shearing the financially illiterate sheep who use pawnbrokers to stay afloat. He would turn down easy money in the bank because he felt it ‘wasn’t worth his time’.

    A lot of domainers are this way. For the one who proudly boasts how he turned a $500 offer into $10,000, there are many more, quietly kicking themselves in the ass for passing on deals offering supernatural ROI, but greed killed it.

    January 23rd, 2012 at 4:54 pm

    Jeroen

    Well said Elliot.

    In the forums, people often stumble over each other to voice their opinion of what does and what doesn’t work without realizing flipping or investing (as an example) is a personal matter that works differently for each and everyone of us.

    The hardest part is to find out what works for you in order to be successful. For that you have to experiment with different strategies and methods. Last month for example, I lost a high $xxx sale but I learned my lesson.

    Cheers

    January 24th, 2012 at 3:58 am

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