How have you been? Hope your September has started in the right way! As the summer draws to to its end on this side of Europe, the days remain sunny here in Lisbon. At the end of every season here, there is a tradition that, for one week, the historical buildings of Praça do Comercio
, the most central square of the city, turn into one giant movie screen, displaying a special "video mapping" with the history of the city. This is how the square looks like in the day:
And this is how the Arch of Rua Augusta transforms at night, in the picture below and in video
Going back to domain names, last weekend I wrote in this newsletter
the similarities between domain investing and real estate and how investing exclusively in premium assets
within premium extensions
has been the strategy that consistently brought profits to skilled domain investors. But how about someone that is new to the game and is considering to buy new gtlds - which new gtlds should he/she invest in? Will they ever reach or even surpass the value of the .com? Is investing in new gtlds a profitable strategy at all?
One of the most valuable tips that I received when I started out in this industry, is that one of the most common way to lose money is to register a bunch of domains
. Now, while there are exceptions and people that have been consistently successful by adopting this strategy (just think about Mike Mann
), I would advise most people to refrain from using this strategy, and I can say this because I personally lost a lot of money doing this. What people do not realize is the amount of work and analysis that goes behind the process of registration that Mike does. You really need to be already at the top of the field with years in the industry to understand what is profitable to register. A much safer strategy is to buy at a discount a premium domain from a motivated seller and flip the domain to an end user.
Another great tip given to me by a friend is that investing in domains, just like any other investment vehicle, is a lot about mitigating risk
. If you own a portfolio of at least 10,000 domains, then it might make sense to add a few low cost but high reward premium gtlds to increase the portfolio performance, but, if you are just starting out with $10k to invest, it is an extremely risky strategy to pursue and chances are that you are going to drop 95% of your newly acquired portfolio after one or two renewals cycles.To close the analogy with real estate, new gtlds are like the "raw land" of the domain industry: while there are properties that can appreciate in value in a very short time (just think about luxury.estate brokered
by our own Michael McConville
for $50,000), the vast majority of them will remain worthless.
Why is that? Well this is simply because there are not enough end users looking to brand under under a new gtld, and there are even less looking to pay a significant premium for it. How many times the board of a successful company decides to invest a substantial amount of capital into a new gtld? Very rarely. At the same time, using a .new gtld might be a decent option if you are just starting out. Let me give you two real life examples:
1. Couple of weeks ago, I loved this article by Andrew Allemann called One of the worst domain names. Ever
. If you read the article, this Neighboorhoods app, might have scored much better by registering neighborhoods.app
as suggested in the comments section, rather than going for the terrible neighbrhds.com
2. Last week I was speaking to a client looking to rebrand their financial consulting business with a new domain. Since they do not have a great budget and wanted to keep using their existing logo, I suggested them to consider registering abc.financial
. The first concern they brought up was: but won't people get confused with the dot in the middle? And they were exactly right. The .com is deeply entrenched in user's behavior and it will take a while before internet will lose the habit of emailing in default firstname.lastname@example.org.
Branding your business under a new gtld can be a solution that makes sense if you are a bootstrapped startup. This is because when you are just starting out, worrying about anything that it is not building the product or finding your first clients is usually a waste of time and money. But, you need to be aware that, when your business grows, you will have to obtain the .com for quite a few reasons, including, as mentioned in this great article
by Alan, brand protection
and email security
Let's take a look at some companies who actually succesfully rebranded under a new gtld. Startive Ventures
used to go under the domain startive.com
, and, if you digit the domain now, you can see that it points to startive.ventures
. This is in my opinion a great way to show that you "get" domains while balancing the need of protecting your online identity. And this is not an islated case: Mark Burgarelli
, had the excellent idea of searching through the top 1M Alexa rank to identify which websites are actually using a new gtld. And we found quite a few examples proving that new gtlds are slowly starting to claim their spot in the "developed" web.
Want to learn more about the new gtlds? Check these websites
(detailed insights about new gtlds registrations)
(official ICANN website)
(new gtlds calendar)
Domain Holdings is a world-class service provider in domain life-cycle management, specializing in the buying, selling and monetizing of domain names. The company was co-founded by Chad Folkening, a longtime domain industry veteran, and John Ferber, co-founder of Advertising.com which was acquired by AOL for approximately $500 million in 2004, and whose collective online products and services have grossed more than $3 billion since 1996.