NameSilo

How does domain leasing work?

Labeled as advice in General Domain Discussion started by MolaRam, Apr 23, 2019.

Replies:
15
Views:
569

  1. MolaRam

    MolaRam Established Member

    Posts:
    33
    Likes Received:
    11
    I understand that its a monthly/yearly rental but my questions are:
    1. What type of customer would lease a domain?
    2. How do they make payments (push or pull)?
    3. How do you manage many domains that are being leased to ensure payments are being received?
    4. What domains do you have that are being leased?
    5. What kind of lease amounts do you charge per month?
     
    The views expressed on this page by users and staff are their own, not those of NamePros.
  2. briguy

    briguy Guru In Remission! VIP ★★★★★★★★★★

    Posts:
    19,851
    Likes Received:
    64,611
    In my experience
    (1) Not enough money to buy out domain totally but really wants it
    (b) Registered in a extension, they can't own mainly ccTLD like .ca/.de etc

    (2) Paypal..

    (3) Monthly invoice from Paypal..

    (4) a few of my "cannabis/CBD" (dot)ca's to Non-Canadians

    (5) 10% of my "B.I.N." price

    Note, I am no expert, only posting from my experience...just another way to monetize a domain.
     
  3. MolaRam

    MolaRam Established Member

    Posts:
    33
    Likes Received:
    11
    1) Are they mainly individuals running a small business or are they quite sizeable businesses?
    2) Do you mean they already have a gTLD/ccTLD but need your's to make their collection complete?
    3) Do you know how did they found your domain? e.g. searching to register on a registrar page or going direct to lander?
     
  4. Rob Monster

    Rob Monster CEO, Epik Epik.com Staff PRO Gold Account VIP

    Posts:
    782
    Likes Received:
    2,152
    This is all way easier to do at Epik. I am pretty sure we do more domain lease transactions than any other provider and have been doing them for years. The buyer/lessee has the right to use the domain while the lessor gets paid. It is all managed and automated so that payments are not missed.

    At Epik, the lessee has one vendor to contact for making payments and for succeeding with using the domain. Most domain leases are done by people who intend to buy the domain later. In other words, it is important to help them to succeed with their domain since it increases sales. Do not underestimate this!

    To start leasing at Epik, see the how-to here:

    https://www.epik.com/support/knowledgebase/selling-and-leasing-domains-on-epik/

    Or use the managed escrow here:

    https://www.epik.com/services/escrow/

    If you are a NamePros member, you can be approved for selling and leasing external domains, not registered at Epik. However, to get the best deal and also for the fastest transactions, it is best to have domains at Epik registrar for the most frictionless experience when dealing with sales and leases. It works for transactions for any size, e.g. from $5 per month to $100,000+ per month.

    Domain leasing and financing are critical marketing tools for domain investors. Earlier today we finalized a $350,000 1 word .COM transaction where the customer will be making payments over 2 years. We don't typically announce sales, so we won't but there are meaningful domain leases and domain financings being done. With Epik, there is one vendor that manages the whole process.

    Also, I have heard people say that they are turning down crypto transactions. This is a mistake. Some of the largest deals to be had right now are crypto deals. You simply need a trusted intermediary. For calibration, Epik did more crypto escrow in March and April 2019 than fiat escrow. You can choose to get paid via conventional sources or hold funds in crypto. Just contact us for help there.
     
  5. lovedomains.com

    lovedomains.com Upgraded Member Gold Account VIP

    Posts:
    1,049
    Likes Received:
    1,697
    I did 1 lease deal, <squarefootdotcom> as vendor

    20% upfront, remaining balance paid over 36 mo

    Total purchase price $55k
     
  6. MolaRam

    MolaRam Established Member

    Posts:
    33
    Likes Received:
    11
    So I see there are two options (correct me if I'm wrong)...

    • The first is renting the domain as a pure rental which means the customer will never own the domain and monthly payments don't go towards the final amount.
    • The second is basically finance where the customer pays monthly until the full amount is paid and they own the domain?

    Which of the two scenarios works best or do most domainers just combine them both so that if the customer wants to exit the agreement they can just leave and if they want to buy the domain then the monthly payments they made up to that point will taken off the final balance?
     
  7. lovedomains.com

    lovedomains.com Upgraded Member Gold Account VIP

    Posts:
    1,049
    Likes Received:
    1,697
    Generally the former doesn't happen as the latter is equitable and permits a default/ walk away which would make it akin to a rental
     
  8. Rob Monster

    Rob Monster CEO, Epik Epik.com Staff PRO Gold Account VIP

    Posts:
    782
    Likes Received:
    2,152
    Both models work.

    If the buyer is strapped for cash, then it is a lease -- they are not making payments on principal but can have a purchase option during the lease.'

    If the buyer has more predictable cash projections then financing makes sense. The danger for them is that if they default they lose their principal.

    Both leasing and financing models work great. With the Epik system you can also build in periodic price increases. Here is the UX:

    upload_2019-4-24_7-47-6.png

    You can also configure custom terms or promotional content for the landing page right from this setup, either for a single domain or in bulk.

    upload_2019-4-24_7-48-55.png

    There is no listing fee. NamePros members can be approved to sell and lease domains registered elsewhere, not just domains registered at Epik. The parking landers are also free and can have ads.

    Buyers can pay in any payment method, including major crypto which is becoming increasingly popular again now that BTC is back on the upswing.
     
  9. BMWMotoRider

    BMWMotoRider Established Member

    Posts:
    80
    Likes Received:
    429
    Rob,

    Nice job explaining options at Epik.

    I's also, mentioned that with leading with Leasing in the outbound I've done-most people say they want to own it. So, that can move a sale forward-due to their expressed interest.
     
  10. Rob Monster

    Rob Monster CEO, Epik Epik.com Staff PRO Gold Account VIP

    Posts:
    782
    Likes Received:
    2,152
    The big thing leasing lets you do is to not lose a prospect when they cannot afford your reserve price. So, instead of saying "make offer" and selling for peanuts, you now have someone turning your domain into a self-funding annuity that not only covers your renewal cost but generates cash. So, even if you lease a domain for $5 per month, you are head of the game on a .COM.

    Then when you get a qualified offer from a serious buyer, you go back to the lessee and give them the opportunity to match or beat your inbound offer which was unsolicited. The best offers are almost always unsolicited so now you have a bidding war between your new bidder and your incumbent lessee who is the unwitting stalking horse.

    The safeguard here for the lessee is that they should be allowed a purchase option. That way you do right by them but also maintain flexibility to sell to a qualified retail bidder. The other safeguard for the lessee is that they can pre-pay. Most don't do that so basically, if an inbound offer comes in the lease can be terminated, and they have until the end of their pre-paid term to trigger the option.

    Anyone who is not offering leases is leaving major money on the table. Yesterday we did a $350K domain lease. On Monday, we did a $175K domain lease. These won't be announced but they are deals that could only be done because there was a lease option.
     
  11. MolaRam

    MolaRam Established Member

    Posts:
    33
    Likes Received:
    11
    What kind of monthly amount did you charge and over what period for the $350k and $175k domain respectively?

    I am thinking about listing some domains on Epik. Can you show me some examples domains on your site that offer leasing so I can see how it looks to a potential customer?
     
  12. Rob Monster

    Rob Monster CEO, Epik Epik.com Staff PRO Gold Account VIP

    Posts:
    782
    Likes Received:
    2,152
    For the $350K deal, it is $25K per quarter for this particular deal -- $25K per quarter for 5 quarters and then a $225K balloon payment is due.

    For the $175K deal it is $1000K per month rental with a $175K purchase option for the life of the deal as long as rental payments are made.

    The point is that the system is flexible across payment schedules and across payment methods, including crypto currencies. So, it is easier for buyer and seller to say YES.
     
    Last edited: Apr 26, 2019
  13. theceo

    theceo Established Member

    Posts:
    36
    Likes Received:
    9
    thank you for explaining this
     
  14. lock

    lock Traffic.tools VIP

    Posts:
    2,380
    Likes Received:
    2,230
    I only think worse case scenario your government turns up at the door the name your leasing has been used in ...
     
  15. MolaRam

    MolaRam Established Member

    Posts:
    33
    Likes Received:
    11
    @Rob Monster I like Epik's offering a lot. You said that I don't have to have my domains registered with Epik in order to use your service which helps me with admin. But once a customer has leased a domain, how do they get to use the domain? If I let them transfer it to another registrar then they can effectively steal it for just a few hundred dollars in leasing costs. One option may be to update the domain with whatever DNS records they want instead but I'm not sure if thats acceptable. What options do people use?
     
  16. Rob Monster

    Rob Monster CEO, Epik Epik.com Staff PRO Gold Account VIP

    Posts:
    782
    Likes Received:
    2,152
    Once the parties agree to do a lease, then the domain does need to be on Epik for the lease to begin. The dmoain is manageable from the user's Epik account and we provide the user with 24/7 support.
     

Want to reply or ask your own question?

It only takes a minute to sign up – and it's free!

Share This Page

NameWorth
  1. NamePros uses cookies and similar technologies. By using this site, you are agreeing to our privacy policy, terms, and use of cookies.
    Dismiss Notice
Loading...