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5 Things to Consider When Starting up a Domaining Business

For those who do not know what actually is domaining business, let me explain that it involves buying, selling, developing and monetizing domain names. It is, in fact, a BIG business and you may earn a million dollar out of it. You might not believe me, but when you know that was sold for $5.1 million, for $2.2 million, for $ 1.8 million and the list goes on.

Well, it’s a million dollar business, but, it’s not just about big names only, expert domainers often cash in $10,000 or $100,000 on unknown domains too. With so many new domain name extensions coming in and a lot of businesses closing every day while abandoning premium domains names, the industry is constantly expanding. This expansion comes with ever growing potential of success, but it comes with a lot of challenges too.

This article will discuss few important checklist items to be considered while starting up a domaining business from scratch.

1- Know that You Need Some Money to Make More Money:

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Yes, you do need money to start a domaining business and it can be anywhere between $100 and $100,000. Successful domainers usually own a lot of domains to create their portfolio, but in the beginning you can start with a small number. A lot depends on the business model that you choose and monetary requirements will vary accordingly.

2- Required Skills:

To be honest, you do not need any particular skills set but you should be willing to learn, experience and improve. The best way to learn the domaining business is by doing it yourself.  To succeed in your domaining business, you will need experience, which you will get over time, by experimenting things and learning from relevant domaining resources like Purely Space. Never close the learning doors and you will find success!

3- Know & Understand the Risk:

As a fact of the matter, no business is risk-free, and neither is domaining business. You must know the various types of risk associated with domaining business, i.e. the domain marketplace scams, the .com names (or other top-level domains) may decrease in value for some reasons, typosquatting the popular companies can get you a lawsuit from the company etc. has rightly explained 5 types of risks associated with domaining business.

4- Avoid the Bad Ways of Making Money with Domaining:

Every business has ethical and unethical ways to make profits and so there are some unethical ways of making money with domaining business too. It is important to know these bad ways and avoid them. Here are the business models to avoid:

  1. Domain hijacking; a process by which internet domain names are stolen from the rightful registrant.
  2. Cybersquatting; when you are registering domain names with bad-faith intent to profit from the goodwill of a trademark that you do not own yourself.
  3. Typosquatting; when you domains that closely resemble those popular domains, i.e., and so on with the intent to get traffic, and possibly to sell the domain at a higher price. It may not be unlawful, but there are higher chances of getting sued by the companies.

5- Finding the Best Way to Make Huge Profits:

If you are serious about stepping into domaining business, the best idea is to do it the legal way which is risk-free and highly rewarding. Here are the some of the best domaining business models.

  1. Domain Monetization is one of the best business models, i.e. it’s less risky, completely legal and may return huge profits. You buy domains, and develop strategies to profit from the traffic they get and then you sell the site anywhere between 12 to 24 times of the site’s monthly revenue + brand price.
  2. Domain Development is another business model whereby you buy the brandable domains, add a website and a service to the domain, and capitalize on traffic until you sell the domain name and its service.
  3. Domain Capitalization is a business model which can be little risky, but if you are good at valuing domains, it can help you sell the next million dollar domain. For instance, you buy and expect that there will be a product/service with that name launching sometime in the future who can buy this domain.


The Bottom Line:

Before you get started in domaining business, make sure to select the right business model. Take some time to get insights of all the business models and choose one that you can do at its best. Experienced domainers run multiple business models simultaneously, but as a newbie, it’s always good to start with a single direction.

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