Domain syndicate anyone ?

[Paul123]

Are any forum members interested in forming a domain syndicate ? A syndicate is simply a group of people who get together with a common aim - in this case to profit from domaining. Apart from bringing in more money and investing in more domains, there are many advantages of being part of a syndicate. You will have access to a wider range of skills, expertise and resources.

Syndicate members can also bring a wealth of expertise - some may have contacts in the domain industry or access to end users. A syndicate brings in more money, increased expertise, greater clout, lower buying prices, and so on. Typically you want members with knowledge of a particular market, and something to offer. Members will also need to bring some funding to the table.

There are drawbacks of course, but these are not particularly severe or hard to deal with. It is essential that the syndicate has a written agreement. It should also be put together by a lawyer to ensure it is legally binding.

The secret is to buy low -- if you buy a domain at below its current market value you should make money from it.

So how do I see it working ? Let's say the syndicate has 5 members minimum -- 10 max. We all agree on our spend. 5 people putting in $2,000 = $10,000. This will buy a decent (ish) domain on auction. Personally I would be happy to put in around 5K in the float -- 10 members putting in 5K = decent domain. Buying higher value domains eliminates most potential buyers due to the cost.

To ensure fair play everything needs to go through a lawyer (Somebody independent everyone agrees on). Let's say for arguments sake everyone chips in 2K. This money is paid directly to the lawyer. No money ever passes hands between members. Using our combined knowledge we find a good dropping domain and bid on it. Assuming we win the auction the domain is pushed to the lawyer, who goes through the transfer process using escrow etc. My thoughts would be to flip and make a profit. When a buyer is found the domain is pushed by the lawyer / funds paid to the lawyer.

The process is then repeated. I would suggest an exit period of 12 / 24 months -- at which point the lawyer transfers every members share of the money directly to them. If people want to continue the syndicate this can be done by agreement.

Using combined knowledge / selling skills / contacts / funds / ideas / manpower etc it could do well. Using an independent lawyer ensures fair play for all involved and that funds / domain ownership won't be abused.

Any thoughts or interest ?

Best,
Paul

 

[Wannabean]

Very interesting idea. Problem is decision making would be slow and arduous. There are likely to be wide ranging differences of opinion.

If you asked 10 people to value a domain, even if they were extremely experienced, they would come up with very different numbers.

It could work if you had say 5 people with separate skill sets who concentrated solely in their area of expertise. Finding such people in a forum that is mainly just for domaining might be difficult.

 

[Paul123]

Very interesting idea. Problem is decision making would be slow and arduous. There are likely to be wide ranging differences of opinion.

If you asked 10 people to value a domain, even if they were extremely experienced, they would come up with very different numbers.

It could work if you had say 5 people with separate skill sets who concentrated solely in their area of expertise. Finding such people in a forum that is mainly just for domaining might be difficult.

I see your point Wannabean but surely this combined knowledge would work in the ideas favor. Let's say everyone agreed that forexample.com was worth over $$$$$. A max bid below this amount should make money if the domain is won on auction. If 10K makes 3K profit then the next max bid is 13K. If all members agree that the domain is worth more than 13K then it's likely to sell for more.

It's the combined expertise that should ensure the best domains are bought for the syndicate.

Best,
Paul

 

[Wannabean]

I see your point Wannabean but surely this combined knowledge would work in the ideas favor. Let's say everyone agreed that forexample.com was worth over $$$$$. A max bid below this amount should make money if the domain is won on auction. If 10K makes 3K profit then the next max bid is 13K. If all members agree that the domain is worth more than 13K then it's likely to sell for more.

It's the combined expertise that should ensure the best domains are bought for the syndicate.

Best,
Paul

Arriving at that conclusion is going to take a lot of time. I just don't think it's practical to have that many people involved in the process. It's going to take too long and time is money.

That's why (hypothetically) I'd suggest having one person in charge of developing domains, another for buying and selling, someone else is the money man, another a lawyer and someone writes content.

If everyone is left to their own specific area not so much time is wasted coming to a consensus. Of course you also have to trust everyone in your team implicitly with their task.

 

[Paul123]

The idea is to flip and sell for a profit rather than develop. 5 people looking for a good dropping domain won't take up more time than one person looking for themselves. It will though give great buying power and is likely to find better domains.

I appreciate your input anyway Wannabean.

Best,
Paul

 

[Recons.Com]

Like the idea, although the application requires refining. Will be watching the thread.

 

[Wannabean]

If the team is split and an opportunity missed, which is bound to happen often, that can cause a lot of friction.

Having that many people performing the same task is gonna be a nightmare imo. Anyway I've said my piece and if you decide to put one together, I will watch with great interest.

Good luck!

 

[Paul123]

Like the idea, although the application requires refining. Will be watching the thread.

Absolutely. Everything needs to be agreed and thrashed out. Are the domains bought if everyone agrees or if there is a majority vote ? I think 5 or 6 people would work best.

At the end of the day it's a punt -- buying any domain is. However chipping in 2K and being in a position to buy 10K plus domains does have advantages -- extra buying power being one ! Five people with some knowledge of domaining working together also has it's advantages

Best,
Paul

 

[Recons.Com]

The syndication could be for establishing market place like BB. We make sure we have 10-20 partners around the world, preferably in big metropolitan areas with lots of start ups, we make great website, decide on inventory criteria and then work to promote it locally, as well as all around the web. Reinvesting in great names could be part of it. For example, 5% of revenue could be allocated towards buying true gems if the deal gets 80%+ of the votes.

I am in, provided that everything is done right.

 

[Paul123]

OK Recons.com Thanks for some very good input. Let's see if the thread attracts any interest and throws up interesting ideas like yours.

Best,
Paul

 

[Nappy Bunch]

following as could be of interest

 

[Kate]

I think everything you mention used to exist at some point the past.
There was DNOA that was an association of NP members, AFAIK it's dead now.
There was also a buyers group (with its own restricted subforum), don't know if it's still active.

Search

 

[Paul123]

Thanks for that Kate. I will certainly have a search on the forum to see what I can find. If any of the members of that group read this thread it would be great if they post.

If mistakes were made it would be great to know about them -- learning from them should ensure they are not made again

Best,
Paul

 

[baseballworld]

Welcome to the namepros forum.