Getting started with Domaining

[Rockefeller]

Domaining is just a fancy word for "investing in domain names." Your first reaction to that sentence might be: "Investment?? Domain names?? I'm sorry, but an investment is an asset with has the potential to appreciate over time and/or return a dividend."

Well, I'm here to tell you that there is a class of domain names that do just that. Domain names are a limited resource with an ever increasing demand, hence they tend to appreciate. Not only that, but there is a subset of domains that gets traffic naturally, either through being typed in, thorough being typos, and through having previously been developed sites, etc.

But this articles isn't here to explain the domaining business and domainers. (That one is) I'm here to tell you how not to make all the mistakes that I made, right off the bat

The first step is to decide whether domain names are truly an investment vehicle you can handle. It's a relatively new market (15-20 years) and the long term prospects aren't well understood. There's plenty of inherent risk - new TLDs are appearing all the time (.biz .cc, .info. .es .eu etc.) - it's a small, unregulated market so there's plenty of fraud - there's a learning curve - and more. The upside is also good though. You can typically buy less established domains for 6-24 months worth of income. That means domains can pay for themselves fairly quickly and become a source or residual income. Notice though, that the interest doesn't compound unless you keep buying domains. But enough of that, I'll let you do your own due diligence.

To get started in domaining, you next decide on a budget. How much are you willing to invest? I recommend a larger initial investment and a smaller monthly one. (Larger and smaller are relative to what you're willing to spend.)

Once you have a budget, DON'T go out and spend it at a registrar buying new names. This was my first mistake; I figured that at $8 a pop I'd outsmart the market and buy my own typos and type-ins and brandable domains. Ha! Most of the names worth taking, are taken. That was my first few hundred dollars down the drain.
What you should do instead is start spending time in the domainer forums. Keep your itchy fingers in check and concentrate on reading, learning, posting questions, and looking at past sales etc. Once you're more confortable with the terminology and the market, you're ready to buy.

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[3ammary]

nice subject

[Kevin]

Good post Rock,

I would add that a myriad of domains drop on a daily basis, providing and additional avenue for domain acquisition.