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Flipping Domain names: How Fast can You Catch and Release?

When I was about seven years old, I loved to paint. One day, as a reward for something or other, my mom bought me these really cool glitter paints. I had pleaded for them last time I was in the toy store, so of course I was jumping up and down with happiness. These were obviously really special paints. In fact, they were so special that I didn’t want to use them. I wanted to save them and only use them for extra-incredible art projects, and by the time those came around, my paints can dried up and were a clumpy, glittery mess.

If you catch a great generic like www.computers.com, don’t let it dry up like my paints! Sure it’s special, but if you never sell it, the name will just go to waste. Unless you plan to develop it for your own business, your domain name means little to you until you find a buyer. In upcoming sections, I’ll teach you how to develop a domain name to make it worth the most money possible, but the simple fact remains that you need to catch and release optimally for the most money. Before you buy a domain name, gauge whether it will be a short-term or long-term investment and how best to develop and market that particular name.

• Short-term Investment

If you buy a domain name with an idea clear in your mind as to who will want to buy it from you, you’re looking at a fairly short-term investment. Equally, if you buy a domain name that comes with a relatively developed site, you’ll probably be looking at a short-term investment. Not interested in developing websites for your domain names and simply want to buy and sell as fast as possible? This might be foolish, but again, it will be a short-term investment.

Short-term investments are great for beginners. Take a look at your bank account. How much money can you really put into starting a domain name business? If you try to buy too many things at once, you may find that you run out of buying power (i.e., money) and are stuck waiting for long-term investments to put some cash in your pocket. With short-term investments, you can keep a continuous flow of cash going out of and coming into your business. Try to imagine your business like a water wheel. You have to keep the money flowing to generate power.

Buying a domain name with an idea of who would like to purchase it from you is a great way to find short-term investment projects. One of the best kinds of domain names for this is the acronym. By reading Part One, you know by now that acronyms do not make the best domain names if they are longer than three letters. However, the key is that most business owners don’t understand this, nor would they care. You can’t make your millions this way, but if you can buy www.PJRE.com and offer it to Peter Jenkins Real Estate, you can turn a small profit quickly—and many small profits build up into one large profit. You can also consider becoming a broker. Talk to small business owners about their domain name needs and provide a service to find them great names at which to build a site.

When you’re looking for short-term investment options, you can also look for sites that have developed already. Ask the owner if this website is included in the price of the domain name. If so, jackpot. You don’t have to do any of the developing work but can still make a larger profit than if the domain name had no developed site. Be willing to pay more for domain names with developed sites, because it will save you time in the end.

Of course, some people like to purchase cheap bundles of domain names to resell as quickly as possible, even if the profit is small. To be honest, you can make a bit of money this way—but you shouldn’t expect to be able to quit you day job, nor should you expect to be taken seriously by true domain name entrepreneurs.

• Long-term Investment

Once you get the water wheel turning with short-term investments, devote some of your finances to long-term investments. In fact, as your business grows and develops, you will probably find that long-term investments will make more money in the end, so if you can keep the ball rolling and stagger these investments, you can work towards that new corvette, European vacation, or winter home in Florida.

Long-term investment implies that you’re going to work at developing and branding your domain name and then advertising and finding the perfect buyer. We can teach you the basics to doing just that, but the fact remains that being successful at this business requires hard work and a small amount of luck. Start with developing and work from there if you want to make the most of your investments.

Tags: domain name flipping,sell domain names,selling domains