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Domain Buyers Club - Good or Bad?

Labeled as information in Domain Industry News started by Eric Lyon, Feb 21, 2011.

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  1. Eric Lyon

    Eric Lyon Member Services, NamePros Super Moderator PRO Gold Account VIP Trusted Contest Holder

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    I found this article interesting....

    A domain buyers’ club or domain buying club or domain club in short is in essence a consortium of buyers who pool their cash to buy domains. That’s the short version. The long version is most ‘clubs’ have ‘membership fees’ and unless you sell enough to cover these fees and make a decent profit, the club won’t generate revenue for you.

    I think most domain forums have at least one club, then there are fractional ownership clubs like fusu, DotSauce recently launched it’s Domain Club as well and Gene has one of the oldest the Domain Profits Club.

    Each has a different take, with fusu you buy ‘shares’ of a domain at a price pre-determined by sellers. The downside is not all prices are realistic or can ensure that you get a decent ROI on your investment. So to realistically invest in fractional ownership, the investors grasp on the subject has to be exceptional. I’m not even going to get into the controlling interest issues with fractional ownership – unless you own 51% or more, you don’t decide when to sell and for how much.

    Forum Domain Clubs operate a little differently – they mostly pool cash to pick up domains from drop auctions and sell them for a profit to end users.......

    Read the full article: Source Article
     
    The views expressed on this page by users and staff are their own, not those of NamePros.
  2. Brujah

    Brujah Member VIP ★★★★★★★★★★

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    It seems like the forum domain clubs are the best deal, especially for the newcomer. That's assuming the math is correct on the subscription-based clubs.
     
  3. mwzd

    mwzd Top Member VIP ★★★★★★★★★★

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    Thanks for adding the post scorp, was just thinking of this from the perspective of the new domain investors.

    Brujah, forum clubs might have no startup charges beyond your investment in the domain, as compared to subscription clubs but there still is the issue of control over the domain in a fractional purchase environment.

    Also, the major conclusion seems to be that newcomers without a knowledge of what is and what isn't good should first learn what does, since joining a club is only part of the equation, selling domains is the most important and one won't get any end user sales with also ran domains.
     
  4. Brujah

    Brujah Member VIP ★★★★★★★★★★

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    This may not be quite the same as a typical "forum club," but NP has a small domain club. It began with a charter to handle most of the foreseen issues. It was actually written really well and has worked well in practice, but like anything there were some hiccups to deal with over the past few years. As a result, we've taken a break from accepting new members until we're finished rewriting the charter to resolve the issues we've faced. Overall, I consider it a positive experience. I would certainly recommend it to a newcomer for the learning experience alone.
     
  5. enterpryzman

    enterpryzman Established Member

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    Thought of starting or joining on

    have thought about this for a while now and it seems to be a valid route. Keep in mind that not only to combine financial resources but, also talents and knowledge.

    This would not be a typical club yet sounds very good.

    Enterpryzman
     
  6. promo

    promo Member

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    Well I first applied to be a member of the Namepros fractional ownership group more than two years ago, have since applied at least once but never heard anything back. To me it is kinda disappointing that it is such a closed knit group. It would be a great learning experience, but people learn very little when not a part of it.

    Maybe we should look into starting up a parallel one here at NP, since it seems that the current one is closed for new members.
     
  7. enterpryzman

    enterpryzman Established Member

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    I requested info several months ago and I was told they had a limited # of memberships and all had been gone for a long time.

    I would consider joining forces in the right situation.

    Enterpryzman
     
  8. vandangpro1

    vandangpro1 New Member

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    It seems like the forum domain clubs are the best deal, especially for the newcomer
     
  9. N-A

    N-A Account Closed

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    I actually like this idea, if people are to work together and not gripe about who gets what. Clubs to ultimately purchase premium domains could work out to be very lucrative.

    With that being said, there are obviously going to be pitfalls to this.

    New domain investors; an assumption, have a low amount of capital, but can possess high level of skills which could be converted with their time as capital.

    If funding is put together, where would it go? Who would be the group leader to determine the financial “officer” to purchase the name and upkeep it as it expands? Who would retain ownership? In addition to that, who would be the accountant who sees revenue and profit to disburse earnings back to members?

    I may be thinking too much into this, but there has to be some sort of organizational structure in a group. Before you can perform and adjourn, you have to norm.

    If executed correctly, all members could make quite a pretty penny and go off on their own ventures. With that being said, if you cannot get past the norming stage of your group, you will never get anywhere.

    A proposed idea would to create one group to see how it goes and elect members to support ideas. However, it still remaining a democracy with votes, as each share has 1 vote in the markets. Though, this can also become problematic because one who invests $1000 has 1000 votes, over a member who invests $100 with 100. The only way around that would be creating an alliance of 10 members to overrule their decision in the voting process, only separating you from your ultimate goals and being counter-productive.

    The only way this can work is creating a business model as your group grows in my opinion. It won't happen overnight. I don’t believe someone who put in 51% should have the final say that the domain that you purchase is RubberTires.com and they want it all designed in black and blue.

    As you can see, there can be problems. It is not an overnight venture and will take hard work to get on track, besides just money invested.

    I would like to see groups performing as if they were working and collaborating together with their entire skillset of SEO, SMM, etc. in order to make domain investments lucrative for the group.

    By the time a domain is developed and earning beyond what they figured it could in N days to years, the group could decide to sell it and split the profit.

    I’m sure by then, everyone would agree with who earns what from the sale. Then, rinse and repeat, possibly changing positions as you learn more about business, or start your own groups with what you learned from your first success.

    It would be amazing to see one year from now members of a group who are able to sell an actual business for six figures above, all started on a beloved forum as NamePros. :)
     

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