Domain names and banks

[onlinestoreca]

I am dealing with some banks and trying to convince them that domain names actually have value. They used to ask me what a domain name was, at least now they say a domain name is a form of goodwill and holds no value.

I tell them "no, they are actually worth money, honest", then I get a confused look and they tell me to go away.

I am an extreme domainer and have put a lot of money into my names, too much -lol, but I wanted to buy while they are bargain priced. I believe I have an excellent portfolio of approximately 1500 good to extremely high quality names, birthdaygift(s).ca, bracelet(s).ca, dinnerware(.)ca, bead(ing).ca, brooch(es).ca, classicalmusic(.)ca, incense(.ca) and many more. I am looking for ways to convince the bank to give me money and use the names as collateral.

Has anyone had any experience with dealing with the banks and domain names. I thought by now they might be starting to get it, but like most businesses out there it is all still mystical stuff -lol. I am hoping to avoid investors for what I am trying to do.

[westcoaster]

Good luck with that! Bank are assholes to begin with. Looking at it from the banks point of view, you may have paid for your domains but they have no value that they could grab onto. There is nothing tangible so to speak. You may have bought them for whatever price but the bank could not get a hold of them and then sell them easily. They could repo a car if it had value and sell it. They could repo your house and sell it. I just don't see how they could repo your domains and sell them. You and I both know they have value - potential value but as for collateral I don't think that is going to fly.

[Maxwell]

If I'm reading your intentions correctly, Digipawn might be your answer.

[onlinestoreca]

If I'm reading your intentions correctly, Digipawn might be your answer.

Wow! I had never heard of them, what a great idea. I would be interested in seeing how they treat .ca domains, but it's nice to see that domains are actually worth money and not just "goodwill" -lol.

Thanks grcorp.

[Vincent]

What if you own premium generic domains? Do you think bank would even consider it? Say you own car.com or sex.com.

Domains are just rentals. The owner can just forget to renew the domain, and thus it will go drop list, or auction list. Maybe if the bank get a legal contract that they have valuation of the name and that the have control over the name, do you think bank will ever open up?

[duceman]

It's funny that you put up sex(.)com. That domain is a good example of why banks are squeamish about domains. It has been bought, sold, and stolen so figuring out who owned it was quite interesting.

[onlinestoreca]

If you could use it as collateral the domain should go in the banks name and you should only have technical administration control. Maybe in another 10 years when the banks realize they can make money from it and foreclose on people's names and make even more money.

[onlinestoreca]

DigiPawn does not deal with .ca domains. Looks like an opportunity for someone here in Canada???

[DropWizard.com]

Reminds me of when I went into a credit union to apply for a small loan a few years back. When the girl asked what I did I described domains and the work I did catching and developing them. She looked at me and asked if I minded that she not bring that up with the manager as it "sounded so HOKEY." I've never been back since and would never waste my time talking to a bank again.

I've seen a lot of your domains and they are probably worth several millions collectively. There's a whole new economic class running around Canada and the rest of the world and the banks will lose the business to other companies that evolve to solve the problems. Like paypal or digipawn or others.

[msn]

I am all for optimism, but let us not fall into irrational exuberance; domain valuations in current market conditions are difficult to bring over to a potential buyer.

Just as an example - we have been contacted several times to sell a four letter .ca domain for a retailer which is interested in coming to Canada, and they do not want to pay more than $10k for a domain which would earn $250k in their existing PPC affiliate programme when they start in Canada.

The traffic is great, and now we are talking to a potential partner about doing a site ourselves because to sell it for anything less than a low six-figure amount right now would not be sensible.

Reminds me of when I went into a credit union to apply for a small loan a few years back. When the girl asked what I did I described domains and the work I did catching and developing them. She looked at me and asked if I minded that she not bring that up with the manager as it "sounded so HOKEY." I've never been back since and would never waste my time talking to a bank again.

I've seen a lot of your domains and they are probably worth several millions collectively. There's a whole new economic class running around Canada and the rest of the world and the banks will lose the business to other companies that evolve to solve the problems. Like paypal or digipawn or others.

[Mark Talbot]

Domain Names are like Baseball cards.

They are only worth what someone HAS paid for them, and even then that can change overnight.

Not very many Mickey Mantle Rookies out there, nor Honus Wagners,... but there are a few highly collectable ones, and also a whole lot of common crap.




And banks dont "invest" their funds on something without proven intrinsic value.
And they are not in the business of having you sign your names over to them so they can secure title to the collateral.

[msn]

Well said!

Domain Names are like Baseball cards.

They are only worth what someone HAS paid for them, and even then that can change overnight.

Not very many Mickey Mantle Rookies out there, nor Honus Wagners,... but there are a few highly collectable ones, and also a whole lot of common crap.




And banks dont "invest" their funds on something without proven intrinsic value.
And they are not in the business of having you sign your names over to them so they can secure title to the collateral.

[onlinestoreca]

Domain Names are like Baseball cards.

Not very many Mickey Mantle Rookies out there, nor Honus Wagners,... but there are a few highly collectable ones, and also a whole lot of common crap.

Domain names are NOT like baseball cards. I am opening online stores and good domain names are one of the most important parts of getting traffic for me. Domain names are much more like real estate, just digital. Yes there is swamp land but there is a lot of useful real estate even if it's not in a big city. If you are correct then most people here without 1 word .coms are wasting their time.

They are only worth what someone HAS paid for them, and even then that can change overnight.

That is true of everything even gold, so I don't see the point.

And banks dont "invest" their funds on something without proven intrinsic value.
And they are not in the business of having you sign your names over to them so they can secure title to the collateral.

I didn't expect the bank to consider my domain names an asset, that would be a pipe dream and that was my point! I would have appreciated some consideration in my income statement when they looked at how much I made last year. When you deduct what I spent on domain names it didn't look near as good. It was if I had just burned my money. It was all formulas, no human consideration or input.

[Gerry]

Convince the bank to give you money?

F that. Develop those *****es and put them to work for you.

[Mark Talbot]

Domain names are NOT like baseball cards. I am opening online stores and good domain names are one of the most important parts of getting traffic for me. Domain names are much more like real estate, just digital. Yes there is swamp land but there is a lot of useful real estate even if it's not in a big city. If you are correct then most people here without 1 word .coms are wasting their time.



That is true of everything even gold, so I don't see the point.



I didn't expect the bank to consider my domain names an asset, that would be a pipe dream and that was my point! I would have appreciated some consideration in my income statement when they looked at how much I made last year. When you deduct what I spent on domain names it didn't look near as good. It was if I had just burned my money. It was all formulas, no human consideration or input.

Please do not take my statements as any type of personal attack or something. I am not trying to argue.

Gold has built in intrinsic value in several industries. A bank can calculate the potential for loss or gain on gold investment, plus it has great liquidity.

A crappy name has no liquidity (most all domains have no liquidity, especially anywhere near valuations percieved or otherwise) except on drop lists maybe. And it definetly has no intrinsic value that a bank would invest in without being attached to a strong trademark or income producing track record of at least a couple of years, and then they will loan on reciepts.

And real estate, even swamp land, has intrinsic liquidation value too.

[jaydub]

Once the banks figure out how they can make fees from domains, then they will value them.
Face it...our only value to our bank is based on how much they collect from us in fees for the various services they flog.

[onlinestoreca]

Please do not take my statements as any type of personal attack or something. I am not trying to argue.

My apologies, I felt like I was at the bank again -lol.

To me, banks are a great tool for the rich and they bleed the poor. I understand why they have to follow certain rules, but the pendulum has swung way too far to the greed side and their formulas protect them from being humans. I believe I am in a huge frustrated majority with this opinion.

[Mark Talbot]

And the irony is, they wont consider a good domain any type of collateral, but they trip all over each other to invest in "AAA" rated subprime loan bundles.

[Gerry]

My apologies, I felt like I was at the bank again -lol.

To me, banks are a great tool for the rich and they bleed the poor. I understand why they have to follow certain rules, but the pendulum has swung way too far to the greed side and their formulas protect them from being humans. I believe I am in a huge frustrated majority with this opinion.

The issue is this...you want money on what you or someone else perceives the value of something to be.

Domain valuation is nothing more than opinions. It's not that the bank has to believe or not believe in domains. It is that there must be some viable mechanism in place to show the market valuations, the ups and downs, just like the stock market.

Your opinion or someone else's opinion of what some thing is valued at is squat. Even in real estate, they still want a fair market appraisal but that appraisal is based on market, condition of the property, the location, and comparable sales. All those mechanisms to measure and calculate what something is worth are in place and used by massive amounts of people in the business and are the standards, trusted by millions of appraisers, banks, evaluators, loan underwriters, and money lenders.

Until domains are publicly traded and shares of stock per domain are allocated and traded on the open markets, getting loans on domain valuation is not going to happen. The courts ruling domains as "assets" is a start but the days of mainstream market trading are far, far away...if ever.

[katherine]

And the irony is, they wont consider a good domain any type of collateral, but they trip all over each other to invest in "AAA" rated subprime loan bundles.

Of course they just levy their commissions, and if they were in the business of selling domains then they would be asking estibotesque amounts for crappy domains