The tables are turned in this interview as Michael Cyger, publisher of DomainSherpa.com and DNAcademy.com, is the one to answer the questions.
Mike Carson, founder of Park.io, talks with Cyger about his recent domain name flip.
Q: What was the domain name you sold?
Q: When did you buy and sell it?
A: I bought the domain name at a Park.io auction on May 8, 2017, and closed escrow on June 27, 2017. Between purchase and escrow close were 44 days.
Q: How much did you pay for the domain name?
A: I paid $1,000 – more than I hoped it would go for. There were many investors that were bidding in this auction, unfortunately for me since I like investing in .io domain names. But I really loved this domain name. I think it’s a great keyword and brand, so I was willing to pay more for it.
Q: Why did you think Detect.io had value as an investment domain name?
A: I follow the methodology I teach in DNAcademy: an investor should buy second-level domain names that have a lot of usage and a lot of companies that could benefit from owning it.
The term “detect” has nearly 230 million search results in Google, and people are performing the exact match search for “detect” 90,500 times per month. This makes Detect.io extremely valuable because if you offer a product or service that does anything detection-related, you can rank well within Google and receive massive organic search result benefits.
The domain name itself is short, passes the radio test and is a great brand. And the .io top-level domain makes it the perfect “starter domain name” for a technology-focused entrepreneur or startup company that wants a great brand but is not ready to invest in the .com – with its associated price tag.
I brainstormed companies and offerings that could benefit from this domain name and came up with:
- Determining if software (e.g., malware) or hardware is installed
- Browser and operating system detection
- Screen size and platform detection
- User types (bots/crawlers/spiders)
- Facial detection
- Audio detection
- Text detection
- Pattern and anomaly detection
- Determining if network or connectivity is available
In addition, I found a bunch of code bases on Github that might benefit from owning the domain name and I made note of them.
Q: How did you sell Detect.io?
A: As soon as I purchased Detect.io (or any domain name), the first thing I did is put up an Efty for-sale landing page (in this case, the Hong Kong for-sale theme) so if anyone typed detect.io into a web browser to see if it was available, they would know they could make an offer.
A few days later I thought the purchase and (anticipated) sale of Detect.io would make a great case study for DNAcademy, so I listed it for sale on Flippa.com in a 30-day auction. I hoped the domain would be selected as an “editor’s choice” but it was not. I then did some targeted outreach to relevant end users that I found on Github to let them know the domain was at auction.
While the domain name generated interest and bids, the bidding didn’t get higher than a few hundred dollars and I had a reserve of $1,150 on the domain (break-even: $1,000 purchase plus Flippa’s 15 percent commission).
When the domain didn’t sell, I changed the Detect.io DNS back to my Efty.com for-sale landing page. A few days later I decided to rerun the Flippa auction (since it was free to do so) and I thought those who followed the auction might bid higher the second time. But I forgot to update the Detect.io DNS back to my Flippa auction page.
Eight days into the second 30-day auction, an offer for $1,000 came in through the Efty for-sale landing page. I countered at $3,450 within a few minutes of email receipt. The buyer immediately countered at $3,000 and I accepted.
I pressed the “Escrow” button on my Efty control panel and it instantly created an Escrow.com transaction between me and the buyer. We agreed to terms, he funded, I pushed the domain name at Park.io using their control panel, and the deal was done.
Q: So the buyer didn’t know about the Flippa auction?
A: No, he didn’t. After we agreed to the purchase price and started escrow, I raised the Flippa auction reserve to $20,000 to ensure it wouldn’t sell twice. Then when the domain was funded at Escrow.com, I closed the auction without a winner.
Q: Did you find out why the buyer wanted the domain name?
A: Yes, I asked when the deal had closed. In this case, the buyer runs an analytics startup and wanted Detect.io for a new service that discovers anomalies in data. That’s all I know at this point in time, but I can’t wait to see his offering. I’ll be following closely.
I love .io domain names because they are used by real software entrepreneurs building real products and services that are changing the world…they are the makers of the next wave of Amazons, Ubers and Airbnbs.
Q: You mentioned you like investing in .io domain names. Do you have many?
A: I currently have about five .io domain names in my investment portfolio, but my investment portfolio is not very large. Instead of buying many domain names and playing the odds – which is a fine strategy – I prefer to hold a very selective list of higher quality domain names. And each year I try to upgrade and thin out my portfolio.
I encourage each domain name investor to define their own path.
Q: Was this just a “lucky” sale?
A: The characteristics and statistics of a quality second-level domain name don’t lie, and in this case they perfectly match the top-level domain name.
It may have been lucky that the buyer approached me only 38 days after I bought it, but I like to think that luck favors the prepared.
In any case, I’m pleased to have helped what sounds like a great fledgling service acquire a great brand.
Epilogue: Before publishing this, Michael told me that he sold another .io domain name using an Efty for-sale landing page and similar negotiation tactics, producing the same $3,000 sales price – but in this case he purchased the domain name (Likely.io) for $90.73 in 2015.