– Update: The domaining book/eBook has been released. Check out “The Art of Domaining: A Comprehensive Guide for Domainers” today! –
A couple years ago, I had a professor for an investments class that said, “The best investment you could make, if you are only concerned about the highest payout, is a lottery ticket!”
At the time, I was like, “Oh yeah, that’s funny.” But I had an interesting thought this morning.
Domaining is like a digital lottery!
Domaining and the lottery
For those of you who have never heard the term, domaining is the process of buying and selling domain names to generate cash flow. For a full tutorial, check out a series I did a few months ago. But when you get down to the specifics of domaining, it is based on a chance.
When a person plays the lottery, they are hoping for a big reward. For our sake, lets take the daily lottery. You walk into a convenience store, tell the clerk which number you want to play, and then watch the nightly news hoping for a match. The odds are against you, the risk of the ‘investment’ is out of sight, but there is still that glimmer of hope.
Chances are risky. When was the last time you went to your mutual fund provider and he told you there was a chance you would be able to retire in this lifetime? That’s not something you want to hear! You want to hear that your investment choices have been making money! And domaining is no different.
Minimizing the risk of domaining
The domainer who randomly buys domain names because they are cheap will get burned. The truth is, most domain names aren’t even worth their registration to most investors. And then in a year, you have to renew them, in hopes they will be profitable!
If you are looking to dabble in domaining a bit, I will give you this piece of advice:
All of the good domain names are for the most part taken. Your best bet is to look into the future, and find what is coming over the horizon. For example, buying a domain name related to ‘voip’ would have been huge4 years ago. The same with ‘wiki.’ The point is to keep your eyes open and look for the opportunities.
I know I am over simplifying the process, there is domain parking, leasing, development, and all of that happy stuff, but the people who have domain name selling down to an art are the ones making the money.
Do I think it is worthwhile? Absolutely..
I will officially go on record and say that I think domain names are some of the best things you can buy right now. And the reason is simple, “They only make one.” Just like in real estate, there is only so many.
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{ 3 comments }
Jason,
Great points!
I think domaining is important. Another aspect of domains, with looking towards the future, is that most resumes will be personal and professional websites. That is why I keep http://www.kyleeslick.com parked in my name
For me its not as much of a risk, but for someone with a common name (like John Smith), getting that domain could be a challenge. I’ve considered keeping my kids names reserved as well, so they have access to them 15 years from now when they are starting to build their websites/resumes.
Great article, Jason. We own about 170 domains right now. We are actively exploring the best place to sell them. I am going to write an article tonight going over some of the major domain selling sites. I will linkback this article because there is some very good material in it.
Thanks Nate! I am looking forward to reading it!
Kyle, that is a great idea – to buy your kids domain names. In 10 years or so, all resumes will be online!