Getting the most for my domain

March 9, 2006 12:03 PM

I have a domain name, and someone has made a pretty serious offer on it. I know there are domain-name appraisers out there, and I'm wondering if any one in particular is considered most reliable—I don't want to leave money on the table if I can avoid it.

Those who are curious can find out the domain name by checking my MeFi profile. I've had the domain name since '94, and I'm in no hurry to give it up, but the money on offer is pretty significant.

posted by adamrice to computers & internet (22 comments total)

Anecdotally, just before the dot-com boom a friend of mine sold 'result.com' for $30,000US.

There are large numbers of domain resellers on the web. My advice to you would be to go through them (and specifically what others suggest here) and compare similar domains to your own for its value. If the offer is exponentially less, consider a counteroffer. If it's roughly in the same range, remember that the posted price on those sites is the asking price and they probably won't get that in the final sale for high $ domains.
posted by Kickstart70 at 12:07 PM on March 9, 2006

Keep in mind that an appraised value for a domain only works if you actually find someone who'll buy it for that value. Domains are like diamonds - essentially worthless but artificially jacked up in price. Are you willing to do the legwork to go out and find another, better buyer for your domain? Are you willing to sell for the price you've been offered?

If you're not, then you might counteroffer a little higher to see if you can get more money out of this buyer, but your alternative is most likely not more, but nothing.
posted by jacquilynne at 12:16 PM on March 9, 2006

Be careful!! If you indicate at any time that you might accept money for a domain, then you are enormously more liable for a 'cybersquatting' judgement. Even if you didn't make the offer of money, if you appear to even mull it over, that can be enough to take your domain away.

If it's completely generic, you should be okay, but if it's even possible that it's a trademarked name... the arbitration board exists purely to take names away from little guys and give them to big ones.
posted by Malor at 12:26 PM on March 9, 2006

To put a little meat on the story, these guys approached me out of the blue, and after a couple pointless rounds, someone called me and said "look, what number do you have in mind that would make you sell today?" I said $X. He said "too much."

He called back a few minutes later and said "I've been crunching the numbers, and I can offer you 2/3X upfront, or pay you X over time." Over time, in this case, basically means 1/3X a year for three years.

2/3X is still a pretty big chunk of change; the payment over time is obviously fraught with danger (I remember the dot-bomb), not to mention that whole time value of money thing.
posted by adamrice at 12:27 PM on March 9, 2006

I can't offer too much advice, significant $ for a .net sounds good. Any way to have the name revert back if the company tanks, or being able to buy back at a fraction of cost in such a circumstance?
posted by edgeways at 12:34 PM on March 9, 2006

If you've gone that far with it, and you're quite sure it's not a name that could be taken away from you... keep in mind that someone here, today, with cash in hand, is worth more than a theoretical price. Bird in the hand and all that.

If it's a large amount of money, you should be getting a lawyer involved.

Personally, I'd rather not worry about the payments, because that requires future performance on the part of someone you don't know. But payments over time may be better for you, tax-wise. You may be able to structure your expenses in future years so that you end up paying very little tax on the money. But then if they don't actually pay you.....
posted by Malor at 12:34 PM on March 9, 2006

Always take the cash.
posted by unSane at 12:57 PM on March 9, 2006

He called back a few minutes later and said "I've been crunching the numbers, and I can offer you 2/3X upfront, or pay you X over time." Over time, in this case, basically means 1/3X a year for three years.


Try this:

Agree to their terms, but add the following condition: You retain ownership of the domain until it is paid in full. The counterparty is granted access to the domain (you will configure it to use their DNS servers, and update the technical contact field to reflect their data, etc.) as soon as you receive the initial payment. If the counterparty misses a payment, offer them a grace period of six months or so, and then the domain reverts fully to your control. In the event of bankruptcy or corporate liquidation, the domain again returns to your control.

What this gives you is the money up front and some protection in case the company buying the domain falls apart. The company gets the domain for the price they want. Everyone is happy.
posted by b1tr0t at 1:10 PM on March 9, 2006

I like b1tr0t's suggestion
posted by edgeways at 1:12 PM on March 9, 2006

b1tr0t's suggestion is probably the best way of handling the situation. I was working-up my own along the same lines but it wouldn't have been as eloquent. ;) The likelihood of competing bids on a .net address is not very high. Take what you can get now if the offer is decent. Just cover your ass first.
posted by purephase at 1:24 PM on March 9, 2006

The only thing I'd say against b1tr0t's suggestion, which is a good compromise otherwise, is that in the extreme instance you might have to go to court to get the domain back, and it would end up being cost negative. Worst case scenario you could get only the first payment, they default and you find it would cost more than that payment to get it back. In that sense, the 2/3 offer is a bit more direct guarantee of the money. From my experience with market research and such I can't see how any of these appraisers could offer more than a guess, and even if they gave the "right" answer it's not going to get this person to offer more than it's worth to them.
posted by nanojath at 1:29 PM on March 9, 2006

All good points posted above -- good luck...
posted by orlin at 2:14 PM on March 9, 2006

I'd take 2/3X and call it done. Do you really want to deal with this for the next 3 years? I guess that really depends on how much X is. If you're talking X = 5,000 or less, take 2/3rds. I'd probably take 2/3rds of 10k as well.

Also be warned about said cybersquatting issue. b1trot has an excellent suggestion, but it may lead down a bad road. I'm sure they'll have vastly more proof that you are 'cybersquatting' if you hold onto the domain until all the payments are done. It's probably not worth their trouble if it's less then 5k, but if you're in the 5 digit range, and they are a large enough company to have in house lawyers on salary, you are screwed. It won't cost them any additional money to put those lawyers to use and you'll then be out 2/3X. Or worse, they sue you for the 1/3X they gave you after a sucsessfull domain takeover, which would be proof in a civil claim that you were 'cybersquatting', and they'd get 1/3X back. Not to mention tacking on lawyer fees for their time and trouble.

Either keep the domain, or sell it outright. Payments are for cars, houses, boats, and credit cards. Not Domains.
posted by Phynix at 2:17 PM on March 9, 2006

Be cautious, of course, as everyone is saying - but hell - don't let a windfall slip away. Offers like that don't come around too often, and blogs can be renamed pretty easily, with a little notice to your readers. :)
posted by ab3 at 2:19 PM on March 9, 2006

Oh, and after seeing that you are just hosting a blog there and a couple email addys.....being offered cash for that, especially a large chunk, is like someone knocking on your door and offering a large sum for the piece of junk car you have in your driveway that you don't use often. They plan to fix it up cause it's a classic, and you take it because you don't have the time or inclination. Win-Win. Take whatever you can get upfront and be done with it.
posted by Phynix at 2:25 PM on March 9, 2006

It's a nice, useful domain name, and the buyer is clearly motivated. The time payment plan would likely work out fine, unless their business tanks after 1 year. The contract would have to allow you to keep the registration until fully paid. Make sure you use some sort of escrow service; it protects both of you.
posted by theora55 at 2:53 PM on March 9, 2006

I you're actually using the domain, as he is and has been for sometime, how does cybersquatting apply? Possibly if they have trademark on "Crossroads" in the same field as his content but I strongly doubt that's the case.
(Not that I'm a laywer or anything)
posted by joegester at 3:02 PM on March 9, 2006

If it's enough, you might as well try to hire a lawyer to work out all the details, especially if they have a 'pay over time' clause.

Alternatively, you could just rent them the domain name. They pay you each month, and if they ever go out of business, you'd get the domain name back.
posted by delmoi at 3:37 PM on March 9, 2006

I work for a large company and have been in a few discussions where the notion of offering somebody money for a domain name comes up. Some observations from these:
1. Set alongside other marketing expenses the purchase of a domain name is often pretty insignificant - even though it may be a substantial windfall to you.
2. There is usually a need to make a quick decision: there will be a plan B or C which involves using another domain name. Don't dither in making your decision. Don't hold out for a stupid sum.
3. If people suspect you are cybersquatting - and have consulted their legal department - you will get a cease and desist letter, or worse, rather than any offer.
4. Quite often an intermediary organisation will be used to make the offer. If you notice that the person making the offer is not the same company you might expect to be doing so then you could suspect this.
5. It might be helpful to look at the trading value of Google AdWords in the possible area that a company might be interested in. That will give you an idea of how hot the market is for this area.
posted by rongorongo at 4:04 PM on March 9, 2006

seriously, take the money and run. you've had your time with the name, so let it go and take the cash.

the fact that you're posting an askmefi question means you're serious about it. and you can buy yourself a nice new name, with all the possibilities that gives you.

unless you're seriously attached to the name itself, or it represents something in an area of business, i say sell :)
posted by triv at 4:09 PM on March 9, 2006

My opinion, as someone without too much spending money (and assuming you don't want the domain that much):
Call back soon, ask for 2/3 right now, turn over the domain as soon as payment is made in full, no strings. Strike while the iron is hot. I would not complicate the matter with wordy contracts, unless you have a very strong attachment to the domain or expect a suitibly large reward.

I would also consider asking for 3/4, since they sound game . But if the money is good, either way, take it now.
posted by MetaMonkey at 4:53 PM on March 9, 2006

Take the money. If it's as much as you seem to be saying I'd get a lawyer on your side to work out the details.

Domains are like diamonds - essentially worthless but artificially jacked up in price.

That's simply not true at all. A diamond not wanted sits on a table. A domain that is short, easy to remember, a common word, etc is very valuable.

A domain such as money.com IS valuable for many reasons. This is not to say domain values won't go up or down, but with more and more being registered, a good domain name is valuable.
posted by justgary at 5:52 PM on March 9, 2006