Let’s Get Rich – Investing in the Next Big Thing

Ninety nine percent of finding the next big thing is discounting all the noise of those that want to convince you that what they have is the next big thing.
Rick Swartz, The Domain King®

We all wish we could have registered the 1997 gems that are selling now for 6 or 7 figures. So why didn’t we? The reality is that most us were online in 1997. I know I was. And yet we didn’t buy. Since then other opportunities have come and gone. But often we haven’t seen or responded to them in real time.

Don’t believe me? Take a look at these 2018 sales.

  • $195,000 CryptoWorld.com
  • $125,000 CryptoBank.com
  • $99,888 CryptoRate.com
  • $65,000 BitForex.com
  • $48,888 BitcoinCash.org
  • $45,000 PayEther.com
  • $35,000 GlobalCoin.com
  • $35,000 CryptoTrading.com
  • These domains weren’t regged in 1997. In fact, the average first registration date for the above list was 2009.

    CryptoWorld (2004), CryptoBank (2008), CryptoRate (2013), BitForex (2013), BitcoinCash (2017), PayEther (2014), GlobalCoin (2007), CryptoTrading (2012)

    The Hype Cycle
    There is a research technology firm called Gartner, that’s developed something called the Hype Cycle. Have you heard of it? It’s a graphic representation of the five phases that an emerging technology (or market) passes through as it matures from seed idea to mass commerce.

    There are five major phases in the Hype Cycle:

  • Innovation Trigger – 5G, 4D printing, Smart Dust, Quantum Computing
  • Peak of Inflated Expectations – Smart Robots, Connected Home, Autonomous Vehicles, Blockchain
  • Trough of Disillusionment – Augmented Reality, Cannabis, Cryptocurrencies
  • Slope of Enlightenment – Virtual Reality
  • Plateau of Productivity – Speech Recognition/Activation, 3D printing
  • .
    In order to cash in perfectly on the next Big Thing there are seven steps to success:

    1) Identify the new trend long before it has any significance

    2) Recognize it as something that is going to be really big in the future (Technology Trigger)

    3) Invest in it when everyone is else saying “you’re nuts”

    4) Avoid the temptation to sell during the first wave of media attention (Peak of Inflated Expectations)

    5) Keep the faith through implementation failures and public rejection (Trough of Disappointment)

    6) Decline lucrative offers during the first wave of public acceptance (Slope of Enlightenment)

    7) Sell for top dollar when the next Big Thing becomes an “overnight success” and is part of everyday life (Plateau of Productivity).

    There are two good times to invest in emerging technologies or markets. The first is obviously at inception. The second (and the safest IMO) is during the Trough of Disillusionment – after the initial burst of hopeful media hype and widespread attention has faded. What I called in a prior DNgeek blog, the Second Wave.

    Is opportunity still knocking?

    There are more than two dozen technologies on Gartner’s 2017 version of the Hype Cycle chart. Some they project are more than 10 years away from full commercial implementation. You can check out the chart here.

    As a forward looking domainer, there’s a few I have my eye on:

    Driverless cars – Exiting the first wave of hype and beginning the long slide into the Trough of Disillusionment due to accidents and fatalities plus competing technologies and implementation issues even for commercial applications.

    Crypto-currencies – There are too many historical ups and downs to place crypto’s precise location in the Gartner Hype Cycle model but I would say its beginning to slide towards the Trough of Disillusionment phase where there will be growing skepticism and disappointment after the 2018 BitCoin (BTC) crash, the failure of dozens of crypto Initial Public Offerings (IPO), the banning of BTC in China, Russia, India etc. and the lukewarm results of early adopters like Square.

    Even if BTC prices rally this year we are still a long way from widespread use and acceptance. Although common among domainers it’s a misunderstood and fear riddled commodity to the average American and it’s years away from everyday, mass usage (ie Kroger’s, Amazon etc).

    Marijuana – I believe it’s in the later stages of the Trough of Disillusionment as cannabis has gradually become legal in seven US states. It’s also been legalized or decriminalized in several developed countries including Australia and Canada. If our government shifts to Democratic leadership in 2020 I think we will quickly see nationwide legalization of medical marijuana and 2-3 years after that legalization of recreational marijuana.

    In Summary
    Big money from big trends is not something that happens overnight and some new technologies die before they make it out of the Trough of Disillusionment. So to be successful we have to step back and look at the macro, five to ten year trends, and be willing to take risks and endure failures.

    In any case the timeless formula of buy-low-sell-high remains the operative principle. While foresight, resolve and patience form the bedrock of successful execution.

    Remember, not only did guys like Rick Schwartz buy domains in 1997 but they held them for decades and turned down many, many very lucrative offers in between.

    Till next time: May all your sales be to end users!

    11 thoughts on “Let’s Get Rich – Investing in the Next Big Thing”

    1. Keith thanks again for the very informative post. Definitely a great strategy for namers.

      But I’m wondering where “domain names” as investments or technology are on this slope…perhaps on the plateau?

      1. … or implantables

        asset tokenization has the potential to be huge, but the big problem in this area remains the legislation.
        also, the tech is not that hard so everybody and their grandmother are doing ICOs.

    2. Alan, that’s a great question. This post was (in my mind) written from the perspective of brandable domains that could be acquired for the coming waves of technology. But if we were to look at the domains as a new technology which began in the early 1990s then I think that we are long off the HypeCycle chart since domains achieved mass adoption and implementation by public corporations and individuals years ago.

    3. The second mouse gets the cheese. I think this can be said of those that forge ahead through the Trough of Disillusionment phase. Nice article, you’re quite the scientist.

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    5. Nice article, and I am intrigued by the graph and its phases. The graph’s author surely knows Pilgrim’s Progress in detail. I mean, this is almost an unintended spoof of it, considering the stops on the original pilgrim’s journey — the Slough of Despond, City of Enlightenment, and the Valley of Humiliation. Domainers could relate to those.

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