Domain Investing on the Margin. Available doesn’t mean flip-able.

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How to know if the name you’ve picked is best name available. Registered Does Not Mean Valuable, And Available Doesn’t Mean Flip-able.

How does a customer tell what the best name available is for their website. How do investors decide what they can buy and flip. Right now you have to guess. As an investor or a business or website owner, you simply can guess a good name, and see if its available. That can lead to some wrong conclusions.

As an investor, we are up over 150,000,000 domain names but the domain name market is not a perfect market, or a rational market.  It would be easy to read a book on flipping  domains, and assume any domain name that is taken MUST have been taken because it was valuable.  So the thinking that is promoted is that is where the market is, and if you buy the next best available name, as soon as the market improves, that unregistered name becomes valuable.

So picture your in line to buy tickets to a concert or move or sports event. The person in front of you says “Best Available”. Say they are sold row 14, seats 4 and 5, middle section.  Then you walk up and say “best available”, and you get the next best seat, same row seats 5 and 6. So that is a rational market. Now the next person could buy the next best seats, or decide to pay you more for your existing seats.

Would they pay much to be same row, 2 seats over? Probably not.  Now 5 rows in front, or in the front row (where the tickets were sold months ago) – the new buyer might pay a premium.  But it would be simple how much over what they can get freely available.

As a domain investors, that is what your trying to do. Your trying to own assets, or “tickets” that are so much better that what people can get for registration fee that they will pay you a premium. And hopefully large premium.

But our market is so in-efficient.  In premium names, we see sales of names that may not be as good as available names.  And at the same time, website owners could be buying names 2-10-100x as good as what they settle for, for only hundred or small thousands.

Another reason the domain name market is inefficient is we don’t know what the best domain name is… to even know what to check.

But as investors my point for you to consider today is to be greedy on how much better the name your paying up for in an expired names auction is, compared to what available at reg fee.  And at the same time, watch out, because expired names are driving the calendar in daily auctions, that your not missing even better names and prospects available for reg fee.

So, Beware of buying names just barely the next best available at time of purchase. Try to buy names that are 10-100 times better than reg fee. At the same time don’t assume because an expired name was taken once, its worth buying now..

Good Luck and Happy Domaining.

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