Retrospective: My Four Years as a Domainer

In many ways, most domain name investment is better labeled as speculation……… Less is more – quality over quantity. Don’t invest unless you understand the quality of a domain, and your options to cash out.

Alan Dunn at NameCorp

I’ve just completed my fourth year of an exciting and profitable domaining adventure.  So today, at the start of a new year, I’m looking back and sharing my reflections on my past successes and failures. This includes insights, stats and some year over year sales analysis.


Keep in mind that I characterize myself as a journeyman domainer investing, almost exclusively, in dot-com, brandable domains.  Everyone’s journey is different but here’s the story of mine.

WEB-DEV FAILURE

I bought a handful of domains in 2014 after seeing a YouTube video saying there was money to be made developing your own websites. The video said it was easy and financially rewarding. The reality (at least for me) was a bit different.

Buying the domain was easy.  Doing web development, search engine optimization, monetizing traffic and then finding a buyer for the website was something else entirely.  I spent about 100 hours on this project and ending up selling one website, on Flippa, for about $250.

It goes without saying that this was a misuse of my time. A huge setback and a false start. But because I only owned a handful of domains that were exclusively for development, I don’t count it as a year of domaining – but rather a failed attempt at development.

BECOMING A DOMAINER

In 2015 I discovered brandable domains and the BrandBucket platform. I abandoned the 3-4 other websites I was starting to build and changed my approach completely. First thing I did was hand register about 400 domains over a period of a few months. At least half of them I purchased for $1 to $6 using GoDaddy coupons.

As you might imagine most of them were not marketable and only a very small percentage were accepted for publication at BrandBucket.  I was, however, able to cut my losses by selling almost all of the rejects on NamePros for $3 to $10. Others I kept and listed for sale on GoDaddy Premium and Afternic.

I then started buying domains in GoDaddy auctions and closeouts – instead of hand regging.  But this didn’t work out much better. Most of the aftermarket domains I bought were again rejected by BrandBucket and I was wasting even more money.

Still, I kept at it despite my financial losses and frustration. Slowly, overtime my name picking skills improved and I developed a method for more carefully hand registering domains along with occasional purchases at the GoDaddy auctions and closeouts. My acceptance rate at BrandBucket steadily improved.  I didn’t have a fixed percentage in mind but my domain purchases ended up being about 80% hand registrations and 20% GoDaddy aftermarket.

I built my portfolio rather rapidly, for a beginner, and had about 350 domains on BrandBucket before I even had a sale.  It was quite a leap of faith and when I got to around 300 domains I began to get nervous. So I cut way, way back on my domain buying for the rest of the year and waited for sales to catch up. That worked out and I ended the year with handful of sales.

My 2015 end user sales totals:

  • Private sales (2)
  • GoDaddy Premium (2)
  • BrandBucket (2)
  • Avg domain length = 8.8 letters
  • Avg time from purchase to sale = 116 days
  • Percent of sales that were hand registered domains = 100%

PERSEVERANCE PAYS OFF

In 2016 I realized that when I bought a domain I had to be thinking 6-18 months out into the future. I had to anticipate naming trends rather than imitating past listings.

I began reading TechCrunch and related websites every day.  I studied the new domains being published on BrandBucket and other brandable domain platforms. I began following the NameBio daily report. I made friends and learned a few tips and tricks.

But mostly I was patient and kept learning and working to grow my business. I believed that my patience would eventually pay off in sales and profits.  It turned out I was right as I sold two domains on BrandBucket the very next month and had steady sales the rest of the year.

My 2016 end user sales totals:

  • Private sales (1)
  • GoDaddy Premium (3)
  • Afternic (3)
  • BrandBucket (19)
  • Avg domain length = 8.5 letters
  • Avg time from purchase to sale = 170 days
  • Percent of sales that were hand registered domains = 57%

2015 vs 2016 – Year over Year

  • Number of sales was 325% higher
  • Average sale price was 72% higher

IF IT AIN’T BROKE, MAKE IT BETTER

In 2017 I focused on consolidation and expansion of profits.  I had a system that was working but my business didn’t seem to be growing. By the middle of year, I had over 2300 domains in my portfolio (1750 at BrandBucket) but my monthly registration renewals and a lackluster sell through rate were taking a big bite out of my profits.

My portfolio was growing rapidly but my sales were stagnant.  So I decided to make some changes. I took a hard look at my portfolio and got rid of nearly 25% of my holdings by selling them wholesale or letting them expire. I got rid of my lower quality, lower priced domains as well as many longer domains that weren’t selling as well as the shorter domains I owned.

In summary, I began to consciously emphasize quality over quantity while still targeting the mid-priced, brandable end user, sweet spot.

My 2017 end user sales:

  • Private (1)
  • GoDaddy Premium (2)
  • Afternic (1)
  • Flippa (1)
  • BrandBucket (23)
  • Avg domain length = 8.2 letters
  • Avg time from purchase to sale = 356 days
  • Percent of sales that were hand registered domains = 72%

2016 vs. 2017 – Year over Year

  • Number of sales was 8% higher
  • Average sale price was 7% higher

MY BEST YEAR YET

It took me all of 2017 and part of 2018 to do a complete makeover of my portfolio but it really paid off. In 2018, my gross sales totals went up more than 60% in spite of having 25% less inventory.

My renewed focus on higher quality and shorter domains, particularly the 4 and 5 letter domains, took my sales to a whole new level.

At the present time I own about 1700 domains. About 1500 on BrandBucket and 200 listed for sale on other platforms.

My 2018 end user sales totals:

  • Private (5)
  • GoDaddy Premium (1)
  • Afternic (0)
  • Flippa (0)
  • BrandBucket (29)
  • Avg domain length = 8.2 letters
  • Avg time from purchase to sale = 632 days
  • Percent of sales that were hand registered domains = 60%
  • 2018 portfolio sell through rate = 2%

2017 vs. 2018 – Year over Year

  • Number of sales was 25% higher
  • Average sale price was 23% higher

SUMMARY OF ALL FOUR YEARS

CONCLUSIONS

There are many paths to success and failure in domaining. This is my journey. Many have done better. Many have done worse. It doesn’t matter. Each person follows their own progress.

Investing style, budget, temperament, strengths and weaknesses will be different for each person.  Hopefully I’ve given you some things to think about or at least provided a measuring stick for your own successes.

Overall the key components of my success have been:

  • Having a multi-year plan and being patient
  • Keeping good records and stats
  • Mastering one style of domain investing at a time
  • Finding a formula that works and refining and repeating it
  • Expanding slowly, gradually and steadily
  • Learning from reputable sources and avoiding advice from anonymous voices on forums
  • Being flexible and moving with the market

Wishing you prosperity, happiness and success in the New Year!!

Keith deBoer

Keith DeBoer is a part-time, domain investor with an emphasis on brandable domains. He's a domain industry writer with published content at BrandBucket, DomainShane and NamePros. He's also a brand ambassador for BrandBucket and by day, he works as an Internet consultant.

30 thoughts on “Retrospective: My Four Years as a Domainer

  1. Thank you so much Keith.Going by some of your sales ,I must say you got better by the year and patient enough to wait for a sale which most newbies dont do as they expect that domaining is easy which is not the case .Each year ,I learn and improve and hand register creatively but buy better undervalued names and resell for good and very high ROI.

  2. Hi Keith..

    We can learn something from each sales history…and their journey to the point…

    Thanks for sharing your experience.

    Thanks,
    Ravi.

  3. Hi Keith…my story is a little similar to yours in that after just 18 months I own a portfolio of about 1,700 domains. While I can’t claim success YET, a business partner and respected peer of mine says I’m in the “Red Zone” https://en.wikipedia.org/wiki/Red_zone_(gridiron_football), and I concur.

    Probably the main difference between your domain journey and mine is that I don’t plan on relying on the likes of a Brand Bucket or a Sedo to sell my domains for me. Neither Brand Bucket or Sedo know the financial, the healthcare or other industries like I do, and relying on them would be foolish imho. Even though I’m new to the domaining business, I’ve been starting, operating and yes NAMING businesses for 50 years. Just take the name for my blog ThatNameGuy™ and the name for my marketplace, DomainGourmet™, names both hand registered in the last 90 days. Even a well respected member of NP offered me a whopping $250 for DomainGourmet™ in a thread I started. And this isn’t to say there aren’t better names to buy or hand register, but the $17 they cost me was a “no brainer” imho. Like your comment, “If it a’int broke, don’t fix it”, like you I believe there’s ALWAYS room for improvement….it’s called progress.

    Thanks Keith for sharing, and I hope I can return the favor. Maybe I’ll see you in Vegas?

    ThatNameGuy™ (formerly Bulloney)

  4. Wow, thanks for the in-depth report Keith and congratulations for the impressive annual improvements in your results!

    Thanks in particular for your BB stats – both the number of sales and your inventory held there. I’m interested in that because I’m thinking of submitting some names and was recently studying their site to find out about supplying your own logos. (Seems you need to put up a logo site containing your domains and logos and submit it for approval. I can do that.)

    I noticed in your acquisition strategy you don’t mention the drops. I find there is less competition there than at GD etc so your ROI can be good. So I use ExpiredDomain.NET and then click on a name I like which gives you the option of going to DropCatch.com to try to acquire it. A great combo.

    So I have a saying: “$59 is the new $9”. That means I believe it’s more productive to find drops than it is to hand reg. But it does sound like you have evolved a good hand regging strategy so good luck with that.

    Everywhere is fast becoming more competitive and I am acquiring much less inventory these days. I’m also trying to reduce my inventory (currently about 2,400) and increase quality, similar to what you did in 2017.

    Most of my names for sale are listed at Uniregistry with BIN prices and usually sell at least one per month there. Mostly brandables. Never calculated my average holding period but guess it would be about 5 years.

    1. Yes, I also have made many acquisitions at DropCatch and NameJet. It is very wise of you to nibble around the edges of the aftermarket and drops rather than jumping in the buying frenzy at GoDaddy. The brandable aftermarket is highly inflated and current prices are not sustainable in my opinion — so I am not buying or regging much these days. In a year or two it will be a buyers market as prices drop due to recession and other factors. I have some cash set aside for that purpose 🙂

  5. Great data but why didn’t you include dollar amounts? The insight would be much helpful if we knew you were losing money or making money. You did say it’s been profitable… but there’s a difference between taking home $1K a year vs $100K.

    1. Hi Bar, Great question. I consider my business finances to be personal and private and I do not share them. This article is my way of providing useful info while at the same time remaining true to myself and my policy (shared by 99% of those in the industry) to keep my business finances private. Thanks for reading and commenting! 🙂

    1. Another good question. I watch my sales – and all publicly reported sales – carefully and this is one of the metrics I monitor. What I’ve found is that since 2015, Invented (Accenture), Hybrid (Spotify) and 2 keyword (FaceBook) sell in approximate equal amounts with fluctuations of 10% or so depending on the year. It’s my perception at the present time that 2 Keyword and Hybrid names have a bit of an edge over Invented names in terms of sales. However, I find that sales are determined largely by what kind of inventory one has. If you have lots of Invented names then your sales will be mostly be Invented names and vice versa etc. I started out almost exclusively with 2 Keyword names but over the past few years have made a conscious effort to branch out and get a better mix — but even so my portfolio remains heavily weighted towards 2 Keyword domains. During the first 3 yrs I sold: Invented (6), Hybrid (17), 2 Keyword (37). In 2018 I sold Invented (6), Hybrid (11) and 2 Keyword (18) You can see my portfolio here: https://www.brandbucket.com/profile/brandtrapper

      1. Great insights in the article and comments, Keith, especially about the types of brandables you’re selling and your thoughts for what will sell going forward. Not too many investors think about/analyze the types of brandables they purchase, but they’d be much better off doing so.

        It’s always a treat to read how you’re doing and how you’re doing it. Thanks for sharing.

  6. Hello. Great article. Thank you. I have been domaining for 12 years, and 80 hours per week the last year and a half, and have had a similar path. What surprises me is the brandbucket part. I only have 49 names there as I sold one, but one in four years, especially as most are aftermarket purchases – not hand reges, it is a loss, and seems a futile path. My thoughts are that the platform used to be good with fewer names, but now with so many and not enough exposure, it is dead. Seems most are eaten up in renewals and the huge bite they take makes no sense. I will be letting all of mine drop over the next couple years and writing that up as a huge waste of time. But, very good to see that someone is doing it still to this day. All the best.

    1. Chris, did you have all 49 names on there for all four years, or you built up to 49 names over a period of four years? If the latter, one sale is not very surprising. A 3% sell through rate at BrandBucket would be considered pretty good. At 49 names, you could reasonably expect to sell a name a year, but that 3% is an average. Some people are going to do better than others for various reasons. Just because BrandBucket accepts a name doesn’t mean that it’s a gem. It’s just probably better than the 99.9% (total guess on this %) of garbage that they reject. The less is more or quality vs. quantity argument is valid, but only if you have the data to decide what is quality. Keith had 1500 names and plenty of sales to make that decision. With 49 names and 1 sale, that will be harder to do unless you flat out feel like the names are terrible. I’d be interested in looking at the names you are wanting to drop if you want to sell them wholesale instead.

      1. Hi Travis. Personally, I see bb has a style they like. I got these names to fit their style. Most of the names have been on two or three years. But, to hope for a sale to just cover the reg fees on the rest seems madness to me. I can send you a pm with my names if you like. Thanks.

        1. Hi Chris – not sure what the etiquette for that is on this blog. Feel free to click my name, click contact, choose my name and send me a message. We can communicate from there. Thanks!

        2. Hi Chris – I got your message via the contact form, but there was no email address. Please send again and include your email address so that I can reply to you. Thanks.

    2. Thanks Chris, for the feedback and comments. My experience is that even successful domainers only sell about 2% of their inventory per year. So for a folio of 50 names that means one sale per year or 4 sales over a four year period – in theory. However, domain sales don’t come in time, they come in bunches and it’s very possible for someone with 50 domains to have a year or two or three with no sales and then have 3 sales in a period of 6 months. That’s just how domaining is. Feast or Famine. The flow of sales only becomes somewhat regular when a domainer has about a thousand domains or more. I think you gave it a shot and are wise to develop a new strategy since the BB approach has not worked in your case. Thanks for sharing and good luck!

  7. PS I was hesitant to put a stat in this article about % of handregs for fear it would imply that I encourage hand regging. I do it, but I don’t recommend it 🙂 I put it there to show people like Drew Rosener and Domain Shane that hand regging does produce sales. BUT….. that comes with a big set of caveats. 1) It’s very, very time consuming to find marketable names to hand reg – and time is money. 2) Every year it gets harder and takes longer as there has been massive ongoing “hoarding” of brandables over the past few years by domainers like you and me. At the same time aftermarket prices are out of control so hand regging remains a viable option for some. Personally, I’m doing about a tenth of the amount of hand regging I did back in 2015/2016.

    1. Keith…your comment about the “hoarding” of domains fits Verisigns narrative about the domain industry perfectly. I mentioned earlier that 100% of my domains are hand registered, and I wouldn’t do it any other way. I also said I hand register domains with a purpose and old timers in this industry just don;t get it. I don’t intend to do business the “old fashion” way, for companies like Brand Bucket and Sedo don’t really understand business or marketing like I do. I know that sounds conceited and vain, but I have good reason to back up my claim.

      I’ll share more with you and others at NamesCon where I expect to learn a lot more than what I already know☺

      ThatNameGuy™

      1. Thanks for reading and sharing your thoughts. Unfortunately I won’t be attending NamesCon this year. But I hope you enjoy the event. Cheers!

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