Great Deals Are Made Before Launch
In my opinion, sometimes the absolute best deals are usually made before launch, and they’re generally made in private, behind closed doors, with terms unavailable to the general public.
The sellers want to use the funds to pay back earlier investors, to fund growth expenses, or simply to line their pockets. The buyers want to get deals that won’t be available once the opportunity becomes publicly available, and they want to cut deals that leave room for huge profits down the road. Both the buyers and sellers take a risk in these deals, but they may work out well for both parties.
I am speaking about venture capital deals and angel investments made by firms in companies that are closely held and privately operated. VCs make big financial investments and gambles when they invest in a startup, and their hope is that the startup flourishes and allows them to profit from their stake. There are no guarantees an investment will work out, but they hope to invest in more winners than losers.
Similarly, as you may have guessed, domain investors have been able to make deals with domain registries to buy and/or develop premium domain names before they’re available to the general public. No guarantees are made with respect to making money on these investments, but domain investors take these risks to be in a good position should the TLD become used and valuable. Registries are able to use the cash to fund operations, and the investments are used per the terms of the agreement.
While some assail these “back door” deals, I personally have no problem with them. They involve private entities mitigating risk and making investments, and while the general public may not necessarily benefit, that’s business.
If you feel strongly about a particular extension/gTLD and can afford to make an investment, perhaps you should make the right contacts and try to work out a deal. While some of these types of deals aren’t publicly advertised (founders programs aside), they can be had simply by meeting the right people and making the right offer.
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