Intro to Domain Investing

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What is Domain Investing?

Domaining is the act of buying and selling domains. A domain is something like example.com. Example.co.uk is a different domain altogether. Both of these are assets that someone could use to earn money.

Domaining in the early '90s was wild, because no one could fathom what the internet would become. To many the general public, knowing cars.com would mean absolutely nothing. Now, everyone has a fair understanding of its power. Go and read the story of domain names if you want a proper background.

There was a time when people assumed that anything .com would bring them whatever they were looking for. We're talking pre-Google, remember. That's why sex.com was once the highest value public domain sale. Throughout the '90s, there was a gold rush to grab digital land that internet users would search for, expecting to find content, services, or whatever else.

In the UK, the best example of this gold rush phase is DIY.com. Who could do with a domain like that? B&Q, of course. Despite their brand's stature, they decided it would be more valuable to have all people looking for do-it-yourself things online to go to find them that way. Same with The Entertainer, who trade via thetoyshop.com and CeX, whose domain is webuy.com.

It wasn't until the late '90s when online shopping started to figure itself out. That brought many new opportunities for domainers to capitalise, and even start their own business based on in-demand products and services.

If you're brand new around here, you may think that you're 20+ years late to the party. You might think that it means there's nothing left out there to grab. It couldn't be further than the truth. There are always opportunities out there to buy valuable domains and resell them at a profit.

The first thing most people do when they make a username is check if their actual name is available. My buddy Beki definitely checked if @Beki was free on Twitter, before she settled on @BekiHayler. If I told her she could get @Beki for £5, even £20, I'm sure she would jump at the chance. The same goes for domain investing.

This very thought is why people have made good money by registering the names of potential X-Factor winners from the audition phase, and selling them to Syco Records when the series is over.

Brandable vs Generic and Exact Match Domains

Yes, most dictionary words .com have gone. Yes, every combination of 1-letter, 2-letter, 3-letter and 4-letter.com has gone. But Google weren't fretting, Yahoo didn't care, and TotalJobs.com didn't mind. Brandable domains can combinations of word phrases or made up things altogether.

Over time, the public's perception of domains adjusted anyway. Where usedcars.com might have sounded like the perfect place to get a used car in the past, it sounds a bit spammy to those that grew up with the internet.

You can still develop a brand from generic word domains, as Bodybuilding.com will tell you, so it's all about making the most of what you have.

For domainers, the goal is to make a profit on their domain portfolio. Every niche has different requirements of their domains, so where a brandable may make sense in one industry, it would be far more suitable to have a generic domain. Every day new SaaS companies are popping up using name up words as their brand name, as per the examples below:

You could be the one to name of those companies, if you have a thing for words and are willing to spend some time experimenting on LeanDomainSearch.com until you come up with a winner.

Where Can You Buy Domains to Resell?

Handregister. This is where you purchase directly from a domain registrar at its standard price. A .com domain is going to cost you under a tenner anywhere.
Private acquisitions. People buy domains every day hoping to do a project with them and never get around to them. If you find unused domains like this, reach out ask them if they'd be willing to sell (but be prepared to have at least $500 ready if they say yes).
Expiring auctions. Domains are registered in 12 month periods. When that time comes to an end, if they are not renewed, anyone can buy them. Over 100,000 .com domains expire each day. Many of these domains end up in auctions, where you can pay between $10 and usually about $2,000 for decent quality resellable names (which at least one person already thought was good!)
Wholesale marketplaces. These are places where individuals list their domains at low prices, in knowledge that the next owner intends to wait long term to see a healthy return on their investment.

There are pros and cons to buying in each way, but most domain investors tend to dabble a little in each in order to find gems. Buying domains to resell is an investment. You're buying assets, so expect some of the prices for the best domains to be quite high. Believe it or not but at the top end, there are domains that are going for wholesale prices of $100,000+ these days, if you want a perspective of how valuable the top domains can be.

Where Can You Sell Domains?

If you want to sell your domains, you have to have them listed at Afternic as a bear minimum. Then there are places that just want brandable name like BrandBucket and SquadHelp. The auction or buy-it-now format it found on specialist domain marketplaces like Flippa and Sedo too. Both are intuitive to use. Both are full of people that buy and sell domains all day long. GoDaddy even has its own auction platform. For UK domains, especially generic one-word .co.uk domains, Domainlore and Flip.uk are your best options.

Like every established community, there are dedicated forums to explore. As well as a place to get tips, they are ideal for quick private message sales as well. (Not everyone likes to advertise their portfolio publicly after all).

The most lucrative way is often to approach the ideal buyer directly. Ronald McDonald, can I interest you in hamburger.com? It's as simple as that. If you learn enough about domains to establish its real value and communicate this well, you will be well on your way to a deal.

One thing to note before you start. Don't get carried away and start registering trademarked names. It's that's a quick way to a legal case and unneeded hassle. There are plenty of opportunities, without heading in that direction.

Wanna Play?

I could go on and on about the subject, because there’s so much to it. There are so many winning strategies, and tactics you can use to sell your names for profit. Before you get ahead of yourself, it's essential that you actually know what you're getting yourself in for. I personally found DNAcademy was the best way to learn how to really find the best opportunities to buy domains to sell in the aftermarket.

Of all the ways to make a quick few thousand pounds online, I'd say domain investing is one of the best options. It relies on creativity, but if you have the head for it, you’ll spend the next week coming up with potentially profitable names (as I did when I first got into it). If you have the mind for it, it's one of those things that anyone can do casually, alongside other online activity.