here's why anything less than 5yrs multiple ain't enough

[BiggieBiggie is verified member.]

some past threads where multiples are discussed:


http://www.dnforum.com/f557/whats-average-monthly-revenue-multiple-now-thread-468455.html

http://www.dnforum.com/f557/whata-s-fair-multiple-thread-321733.html

http://www.dnforum.com/f31/domain-name-website-revenue-multiples-thread-151576.html

http://www.dnforum.com/f77/why-cost-traffic-domains-so-high-thread-87899.html

http://www.dnforum.com/f31/valuation-multiple-revenue-thread-110009.html

 

[amplify]

All with various opinions ranging from 18 months to 10 years and beyond.

 

[Anthony Ng]

I know that this response may not be widely viewed as popular public opinion because older folks on here know Biggie and can separate him from Biggie the moderator, but I'll explain my stance why.

A beginner (typically gold) will see this post made from a moderator and associate it with being fact because it's made under a moderators account which has positional power. They will take it as the golden truth and follow through with it.

However, I and many others know it's posted in good faith as expert/informational power.

A lot of others chimed in with expert (in other industries) power and informational power, but it may be discredited by most newcomers because the title you hold

I wouldn't worry too much. Yes, I know Biggie from way back (and have even worked with him side by side right here on DNForum), so I know when he posts an opinion, his being a moderator does NOT weigh any more than his years of buying and selling domain names first hand. And I'm sure most even "newcomers" could, would and should take every post by its merits and judge by themselves. That is also why opinions are opinions, and what Internet forums like DNForum are meant for: to exchange informed opinions.

 

[BiggieBiggie is verified member.]

I wouldn't worry too much. Yes, I know Biggie from way back (and have even worked with him side by side right here on DNForum), so I know when he posts an opinion, his being a moderator does NOT weigh any more than his years of buying and selling domain names first hand. And I'm sure most even "newcomers" could, would and should take every post by its merits and judge by themselves. That is also why opinions are opinions, and what Internet forums like DNForum are meant for: to exchange informed opinions.

i haven't forgotten those days either Anthony

Thanks for the support!





most mods/admins rarely engage in forum discussions, yet when i do.......


some clown gotta start hate'n


why?

 

[amplify]

Not hating on the post, just have a differing opinion on multiples.

As a fact of a matter is there are different types of business models in any industry. As far as domaining goes, selling on multiples is a way to go if you cannot find an end user and someone else can (or in your case, change a keyword and make more money on it). Though, would you go through each domain and purchase them for $60 a piece if they had $1/mo revenue. They make registration fee per year, add to your profit margin and you could quite possibly end up selling it to an end user for much more than $60 in the end. However, how long will that take while you only added $4/year to your portfolio with the time spent of buying, transferring, renewing, keyword targeting, etc. Is that extra $4/year worth it with the time spent modifying the domain? In my opinion, no.

If a domain made $100/mo and it had sustained statistics from a reputable member, it would depend on the quality of the name as well as the source region of traffic. Could I build a website over that parked name and make more? If I could, I would offer 2-4 years income.

When you get into domains making $300-$500/mo parking, it's a whole new ballgame as those domains are typically very generic or have type-in traffic (and should be developed rather than sold), though some of these domains are trends and the earnings may die out within a year so it's important to look at every aspect of the name before making a purchase to have a positive ROI. At that point, I would look at the name and determine whether it's worth a 5 year multiple or more (which tends to be the case for these ones as they're solid earners and have a long history of earnings, though as mentioned, some are trends or "typos" from other websites that you may not want to invest in).

Solid points on 5 year multiples. Though in my opinion, the name itself has to be broken down and categorized if it's worth the purchase or not, be it $60 for $1/mo or $12000 for $100/mo.

 

[BiggieBiggie is verified member.]

Not hating on the post, just have a differing opinion on multiples.

As a fact of a matter is there are different types of business models in any industry. As far as domaining goes, selling on multiples is a way to go if you cannot find an end user and someone else can (or in your case, change a keyword and make more money on it). Though, would you go through each domain and purchase them for $60 a piece if they had $1/mo revenue. They make registration fee per year, add to your profit margin and you could quite possibly end up selling it to an end user for much more than $60 in the end. However, how long will that take while you only added $4/year to your portfolio with the time spent of buying, transferring, renewing, keyword targeting, etc. Is that extra $4/year worth it with the time spent modifying the domain? In my opinion, no.

I believe that this post should have been made on a personal blog and not this DNF section.

I know that this response may not be widely viewed as popular public opinion because older folks on here know Biggie and can separate him from Biggie the moderator, but I'll explain my stance why.

A beginner (typically gold) will see this post made from a moderator and associate it with being fact because it's made under a moderators account which has positional power. They will take it as the golden truth and follow through with it.

no hate, if Adam had posted same thing, would you have said same bullshit?




however.....if there was a website, that listed domain names for sale and each one had past stats where each name earned $1.00 a month, and price of each name was $60....they would all get sold.
domainers would take the risk on a names that have some earnings, based on the potential to increase it.

If a domain made $100/mo and it had sustained statistics from a reputable member, it would depend on the quality of the name as well as the source region of traffic. Could I build a website over that parked name and make more? If I could, I would offer 2-4 years income.

When you get into domains making $300-$500/mo parking, it's a whole new ballgame as those domains are typically very generic or have type-in traffic .

i have sold names making more than $500 a month and the game stayed the same as if i were selling a name that didn't earn any income.

but whether a domain makes $50 or $500 a month, the only difference between them is that actual domain name and maybe who owns it, because of the varying degrees of knowledge of monetizing applications that may give one domainer an advantage over another

 

[amplify]

no hate, if Adam had posted same thing, would you have said same bullshit?

Adam himself said multiples aren't the way to go and doesn't sell on them. I would have to disagree with that to a certain extent as well, because sometimes we need funding for other projects and selling on multiples as it is an easy way to obtain those funds if all other options have been exhausted (IE, credit card maxed, can't get another loan, nobody will give you capital, etc.). I don't take what nobody says as the Gods honest truth in this industry as I've seen even the giants make huger mistakes... why follow in their footsteps when I can make my own?

i have sold names making more than $500 a month and the game stayed the same as if i were selling a name that didn't earn any income

Exactly what I was saying, the name has to be looked at as well as the revenue it made in the past. Revenue cannot be the only factor in a domains sale IMO.

but whether a domain makes $50 or $500 a month, the only difference between them is that actual domain name and maybe who owns it, because of the varying degrees of knowledge of monetizing applications that may give one domainer an advantage over another

And that's where you made a solid point about domain names. Having purchased one at $XXXX, you were able to turn it into a profit generating machine by one simple keyword modification. You were able to see the weakness in the other domainer and saw your strengths in the industry to acquire it in order to 1) [pure assumption] know that the name would be worth more in the future, be a risk investor or 2) have the knowledge that the domain could make more money by doing simple research.

If you feel like I attacked you personal in anyway, sorry. I just want to reiterate the fact that I disagree with 5 year multiples on every domain as there are too many question marks and until those are answered, then I may go 5 year.

 

[BiggieBiggie is verified member.]

If you feel like I attacked you personal in anyway, sorry. I just want to reiterate the fact that I disagree with 5 year multiples on every domain as there are too many question marks and until those are answered, then I may go 5 year.

i do feel like you attacked me and my reputation and tried to discredit my knowledge by attaching to a moderator job title


however, i'll let it slide


but re-read my first post

for those looking to buy "proven" domain names that produce revenue, thru type-in traffic.

here's why anything less than 5 yr multiples is too low.

so it's not "every" domain.

 

[amplify]

And that's why I agreed with you and said taking a step back gives you a whole 'nother perspective. If this was posted on Rick's blog, I'm sure there would be a lot more people over here saying 5 year, 5 year, 5 year, etc. as opposed to the moderator status. I think I made that very clear in a post and if I haven't, I'll mention it again: your status does not have any weight on your opinion on DNF.

And anything can be "proven" through a certain amount of time. Someone could buy traffic for 6 months on a domain name, then pump and dump it. Of course their reputation would be at stake as well. That's why I mentioned purchasing from reputable members with stats when going for revenue names.

However, I and many others know it's posted in good faith as expert/informational power.

...that does not discredit your knowledge in my book.

 

[BiggieBiggie is verified member.]

If this was posted on Rick's blog, I'm sure there would be a lot more people over here saying 5 year, 5 year, 5 year, etc. .

if it was on Ricks blog, we'd be talking 100 years revenue


so maybe i should increase the multiples

 

[amplify]

Most definitely, especially on .XXX.