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0 pointsdavemel3710y ago0 comments

> I registered a domain last week directly from the registrar for $200 a year, which Is a lot for me. I know it is probably at least worth $1000

This is a perfect example of the trajectory I was referring to. Back in 2006 I believed I could register a name from a registrar and turn around and sell it for $1000. I even knew the economics of domaining. All the monetization strategies, sales tactics, valuation models, and based my belief on comparable sales, etc... (in other words, there was real value independent of two buyers competing for it.)

Yet, now I believe it is tantamount to a scam. Intrinsically, there is no value in a domain name that you can register today. The value is a complete fiction. Sure, there are tons of suckers today buying names they shouldn't, taken in by the shining lights, but this is my point. The domain names that have intrinsic value are long gone and have been for over a decade. (i.e 2 & 3 character, dictionary words, short pronounceable & brandable, names, places, etc...)

The only value in domain names today is if two people both desperately want the name. Too often it is the ego of someone who falls in love with a name they thought of for their brand and can't untangle their ego from reality and end up buying a name that they didn't need.

In a few years, their knowledge will catch up with mine today and they will perceive the opportunity the way I do. The same way in a few years I will have the experience to view things in a new light. I have to remind myself that someone exposed to domaining in the last 5 years doesn't have the benefit of learning what I learned over the last decade.

> domains for an analogy are like real estate.

I used to share this belief, but now I believe it is built on a fundamental misunderstanding.

Fundamentally, the only thing that would give a name value like real estate is if its easier to spell or remember. I.e. more accessible than another name. There really is no intrinsic difference between genius.com or smartbloke.com or owlsmarts.com All are short, easy to spell, easy to remember, easy to tell over to friends, and conjure up the same general idea. Yet, domain sellers will have you believe that genius.com is worth 10x-100x the value of the others. This is a pure fabrication.

Real estate and location have very real dynamics like accessibility, visibility, local demographics, parking, passing traffic, etc...

In the old days, a domain name with type in traffic would trade for 4-6 years revenue from parked traffic. That was comparable to real estate.

My point is simply that I can't understand how someone buys a great generic domain name for 5-6 figures like nerdy.com, when they can accomplish 95% of the same thing with any two dictionary words like, " nerdybird.com or nerdyduckling.com , etc...

0 comments

vonklaus10y ago

I agree with you for the most part and it is possible-- quite likely even, that I am saying my example is the exception to the rule, but generally it is not the case. However, I am not domain squatting and the economnics aren't there to do that anyway, it was to illustrate the larger point that some domains, like real estate assets and "tech" companies are very valuable while apparently similar substitutes are not value and actually quite dangerous.

Currently, subtle differences make a big impact on metrics(growth, value, price) & the market is beginning to price these in. If you have seen the big short, it is a great movie, but the opening line is something like:

It ain't what you don't know that gets you into trouble. It's what you know for sure that just ain't so.

So try to check myself when I think about something like this, although it is obviously difficult. In this current framing, certainly one or both of us, is wrong and it is sort of a matter of timing.

I think we are in 1993 and you think(I don't want to put words in your mouth) are in 98'. Either way, if you were in 93 or 98 and knew what to look for you could have made a lot of money, and you yourself may have because you were fundamentally correct when others weren't.

So on balance, I think you are totally correct and I do not disagree with you. However, my estimation is that many people are making the mistake of grouping unrelated things together and drawin g a conclusion, when I think that in fact, the opposite could be true currently.

davemel37OP10y ago

Fair enough.

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