- Impact
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Every week one sees brandable .COM domains - no Google Keyword Planner search volume which sell for $XXXX. Some domainers such as Michael Berkens and Rick Schwartz even manage to negotiate five and six-figure offers on such names (iReport.com, eBet.com). Ample discussion is available elsewhere regarding valuation of .COM domains which receive type-in traffic or which have exact search volume per Google Keyword Planner. Exact match domains in other extensions theoretically gain some ranking advantage which may have a value though with all the new extensions available now and Google lowering the benefit of EMD domains, perhaps that value is much less than several years ago.
Short, memorable domains do regularly appear on the weekly reports and there are marketplaces which specialize in such names. It is has been said many times a domain is worth what a buyer (ideally a very motivated end user) is willing to pay for it.
Many individuals who have been in the industry for several years have sold some brandable domains. But inevitably not all such names will garner interest. In finance, a project or a business is valued based on discounting projected cash flows which for a domain portfolio may be estimated by looking at recent cash flows.
If a domain has received an offer but no agreement was reached, one can still say someone was willing to pay $X for that domain. It is true that a domain sold last year cannot be sold again but for simplicity we will assume you have other domains in your portfolio of comparable quality so there is a reasonable chance that one of those will sell in the future for a comparable price.
So take last year's domain sales revenue plus offers received on domains still held less annual domain renewals (domains still held) and you have a projected annual cash flow. One can debate what multiple a portfolio buyer might be willing to pay for such a portfolio of domain names. Given the risks in this industry, we are probably talking a single digit multiple but I will leave that open for discussion.
Cash flow (revenue less renewals) x multiple = estimated portfolio value
This is not scientific but just an idea which came to mind.
Short, memorable domains do regularly appear on the weekly reports and there are marketplaces which specialize in such names. It is has been said many times a domain is worth what a buyer (ideally a very motivated end user) is willing to pay for it.
Many individuals who have been in the industry for several years have sold some brandable domains. But inevitably not all such names will garner interest. In finance, a project or a business is valued based on discounting projected cash flows which for a domain portfolio may be estimated by looking at recent cash flows.
If a domain has received an offer but no agreement was reached, one can still say someone was willing to pay $X for that domain. It is true that a domain sold last year cannot be sold again but for simplicity we will assume you have other domains in your portfolio of comparable quality so there is a reasonable chance that one of those will sell in the future for a comparable price.
So take last year's domain sales revenue plus offers received on domains still held less annual domain renewals (domains still held) and you have a projected annual cash flow. One can debate what multiple a portfolio buyer might be willing to pay for such a portfolio of domain names. Given the risks in this industry, we are probably talking a single digit multiple but I will leave that open for discussion.
Cash flow (revenue less renewals) x multiple = estimated portfolio value
This is not scientific but just an idea which came to mind.
