Is DotComAgency 'making millions' ?

[Aggro]

you are along way from reality on this, that company is making millions per year.

http://www.namepros.com/domain-name-discussion/146484-portfolios-why.html

The truth can be revealed.

DotComAgency made a net profit of GBP 32,165 for the y/e 31.3.05
Shareholders funds @ 31.3.05 = GBP 24,698
Acc'd profit @ 31.3.05 = GBP 14,698
(As of 31.3.04, it was technically insolvent ie. S/H funds = (7,467) < 0 ever since the entity's inception in 2001.)

I expect the current year profit to be a bit more.

A very far cry from the "that company is making millions per year" fiction, eh? LOL

As to be expected considering that his biz model is primarily reselling and given that:

- most get minimal traffic (conversions even less) and make less than $6 annual reg fee
- renewal fees on ~ 25,000 domains = $150,000 fees just to break-even.


I base the above on facts NOT hearsay fiction.
I used factual published statements. Did you?

Another myth bites the dust..

 

[primacomputer]

Interesting. Where do those figures come from?

 

[JMJ]

Whoa, sounds like someone needs to re-evaluate their business plan. lol

 

[funnybone]

smells fishy. I have always treated my dealings w/ them with caution.

 

[-db-]

No doubt, there is a huge difference between snoop's claim and yours, but can you share any sources or links to verify these numbers? I think we would all be interested.

 

[Aggro]

http://www.companies-house.gov.uk
Published accounts - for a small fee.
Take my word for it or do your own due diligence.

For these 25,000+ merchants (without significant traffic), $150,000 just to break-even. It is typically a bull-market strategy. In a bear market investors will just melt away...

As I have been saying all along, unless the whole portfolio - warts and all - is sold to a Mr Deep-Pocketed-Investor eg ExclusiveDomains (30,000+) to BuyDomains, it becomes a constant game of running to keep still as the large annual renewal fee/fixed costs bite.
Also there is only a certain % that can be sold per year at "end user prices" ie. much < 2% in practice.
And rest assured *this* is what *every* 'big player' is trying to do before the inevitable cycle takes a dive...as all industries are prone to do...

As more and more of the "good/desirable domains" get sold, eventually there comes a point after which the operation becomes unprofitable (without selling the best stuff) as the remaining domains become unsaleable (at those prices) unable to offset the renewal fees.
Just b/c people are searching for eg. KneelengthYellowSocks,com and something has 'OV w/o extn' does NOT mean an end-user would want to put a business on it. Or that it gets natural type-ins. Seemingly even many experienced domainers fail to grasp this. Just look at many of the crummy drop domains (no/minimal traffic guaranteed) and the $2500-$4500 prices paid...

A bit like the "peak oil" theory.

 

[primacomputer]

One squid well spent.

I particularly like how they have that 249A audit exemption reserved for companies with a turnover of less than 90k. Pretty hard to be making millions with that kind of turnover isn't it? Great call.

 

[cache]

I think if you have a lot of money, you can choose 10% of your money to invest on something that does not generate short term income for you. You are hoping that in the long term, the names will be worth more than multiple reg fees. In that case, you investment is still a smart one.