I would like to share some reasoning about why the market is not stupid regarding valuing .io domains. We see a lot of good .io sales lately. Some people argued this was just a Flippa empowered hype during a short time frame begin 2015. Hard sales facts, prove this assumption wrong. First of all there have been numerous sales on Sedo and park.io too. Furthermore there are numerous sales of mid to up 4 figures in 2015, even good 5 figures like cloud.io (45k) and db.io sold recently for 18k. Domain Holdings reported even a 6 figure .io sale in Q2, setting a new land mark.
So why is this .io ccTLD increasing in popularity?
First of all there are linguistic and psychological explanations which are always the key metrics when it comes to valuate brands. The specific linguistic and psychological strength of .io is often explained by its input/output association. This is off course the reason why so many startups turned to the .io TLD in the first place.
Entrepreneurial frontrunners selecting the .io TLD representing their brand is a strong and important argument for the increasing valuation of .io names. But for me this explains more why the .io snowball started rolling in the first place. This hardcore passion driven energy is almost always the starting point of a trend which may become mainstream and could turn into a big industry. You could compare this for example with surf pioneers, underground DJ's, computer geeks et cetera. When passionate skilled people embrace something they could create a cult. And this is where the real value is: a cult accepted by an audience. Some cults will and some cults won't.
So if we look at the .io cult with already many well funded beautiful crafted websites than I think there is more to it than just a cheap alternative TLD for hackers. By the way I do think it is rhetorical smart for .io criticisers to refer at .io buyers as 'hackers, suggesting that these buyers are some kind of raw punk people finding anti-establishments hacks for their little scene. Quick jumbing on another TLD bandwagon when .io becomes more expensive. The truth is that current start-ups will need a whole team of left and right brainers, business people, UX designers, writers, marketing professionals and software engineers to survive. As an end user you not only experience intelligently coded applications you also see a smooth crafted tone of voice, beautiful elegant user centred design and sophisticated logos. These teams investing thousand and thousands of hours and they do want a great brand not just a hack. And the startups can still buy edgy creative single word .io names for a decent price when premium .io names go sky high. So increasing worth of premium .io domains and ongoing adaption of .io by the the next best startups are not mutually exclusive.
These people create the cult but the real value and potential of .io lies in the end user perception. The cult, the crafty websites will contribute to that end user experience. I do think that the intrinsic characteristics of .io fit this cult like a VR glove. In contrast to .com with a vowel in the middle, .io has a more open friendly and fresh feeling. The 'i' and the 'o' are sitting as two friends next to each other on the keyboard. Like 'ly', 'io' is a common ending for English word like 'bio' or 'cheerio' making it a logical sound right side of the dot. I do not see the biggest value for .io in a domain hack way like cheer.io. The highest .io sales confirm this. Short dictionary words and tech acronyms do best left side the dot.
And yes I am bit biased owning a couple of beautiful .io names.
Cheers,
Freddie
