Unlike domain forums such as Namepros in the west, I find their counterparts in China not very engaging with discussion or debate. Nevertheless, once in a while I do find one or two interesting articles posted on Chinese domain forums. For example, the other day I came across a long post on DNbbs.com.
It was written by a domain investor using the handle Budongyuming (不懂域名). The name is quite ironic as it literally means “don’t understand domain names.” The post describes 18 lessons the investor learned through domain investment, and I list them here to share with you.
1.
Money in the bank is more reliable than in your registrar’s account.
2.
Investment is planned but speculation is impulsive.
3.
Priority 1: .com > .cn > .com.cn > .net. Priority 2: Acronym (up to 4L) >= Pinyin (2-pin) > number. For numbers, 4N or less are solid but 5N names do not have many end users.
4.
Domain names can only be sold to either end users or domain investors who eventually will sell to end users. If no domain investor wants your domain name, then that also means there will not be end users for your domain name.
5.
You pay a “tuition” at the beginning of your investment life to learn because you have experience, no good training, or no master to teach you.
6.
Stay away from speculation!
7.
Only one type of people can speculate: the big players.
8.
Domain names are like antiques. It takes time for value to increase. Do not expect to get return to your investment within three years, regardless of how good the quality of your domain name is.
9.
Don’t buy stolen domain names or those that are clearly way under their market values.
10.
Do not borrow money to invest in domain names. Using money you’ve earned will help you learn how to invest and make a profit.
11.
Selling domain names to end users is an art, and selling domain names to investors is a business. Art is harder to master.
12.
Market prices are good only when you buy or when you must sell urgently. Ignore them after you own the domain names.
13.
Do not believe the headline news. Instead, develop your analytical ability.
14.
Do not take it lightly when acquiring a domain name that matches a brand. You may lose both your money and the domain name.
15.
Have a plan to lower risks when managing your profit: cash out, reinvest, or diversity.
16.
Domain investment is about constantly getting rid of lesser quality names and upgrading to better names.
17.
In some cases, buyers may not be able to pay your expected price. Therefore, also prepare the lowest price that will allow you to get ride of the domain name — even at a loss.
18.
Start with a small goal — such as being OK to lose $1,500.
Details in Chinese can be found at http://www.dnbbs.com/thread-1184712-1-1.html
How about don’t spam, and get stuck with crap you don’t understand
Majority of chinese investors are stuck with $2-2.5K 4L.com chips which trade at about $1K today.
Sell thru rate on such domains is about 3% in a bull market, good luck to them
Fascinating post, Kassey. Thanks!
Some great info there.
Smart person
Thanks for sharing this, Kassey.
As someone who’s been in the game since 1997, I would agree with most of what this person said, at least that which (as a Westerner) I’m able to relate to.
And it is very nice to see him confirm that in his ‘Priority-1’ list DOT-NET is included.
While most of portfolio consists of DOT-COM (and some quality DOT-VIPs…my new favorite), I also have a handful of DOT-NETs.
But I am consistently at a loss for why DOT-NET doesn’t get more respect, despite the fact that it’s widely used by enterprises (e.g., SlideShare.net, Money.net, and SourceForge.net…just to name a few).
In fact, the largest domain deal I’ve ever completed was based on a DOT-NET.
Some of these, I can agree with (if we’re strictly speaking Chips)… but, if you’ve been in the biz for a while, it’s hard to grasp that anyone would believe the following if this post is applicable to outside the East:
4. …If no domain investor wants your domain name, then that also means there will not be end users for your domain name.
Many times domains will never pass hands between resellers, even for such a small amount such as $1 on namePros. But, there are instances where they’ve still landed in end user’s hands for hundreds, if not more.
I’m sure this goes for Chips only, as there is pretty standardized pricing, but if not, I disagree with this as well:
9. Don’t buy stolen domain names or those that are clearly way under their market values.
Domainers often find themselves in a rut. This is the perfect time to purchase names. Many of us know this is typically around December when domainers are trying to collect some quick cash for their forgotten Christmas presents (it happens every year, and never ceases to amaze me).
17. …even at a loss.
Why? You can literally pay $100 and wait it out 10 years. If nothing comes in that timespan, then you picked a poor name.
But it’s okay, because:
18. [It’s] OK to lose $1,500.
But, it’s really not. You shouldn’t even start investing with a small goal in mind such as the $1,500 mentioned because you just need to revert back to:
2. Investment is planned.
Quite true all these 18 lessons, some of them I’ve learned on the hard way and I’m still learning. 🙂
I guess all the new domain investors are learning or will learn a lesson or 2 on the hard way at some point, right? It’s inevitable!
Thanks for sharing Kassey, as well as for the translation!
Thanks Kassey Lee! Some good thoughts here! Question: Do Chinese domain investors buy names during holidays (like National Day Golden Week, beginning on October 1st)? I appreciate your reply. Cheers!