My question to Godaddy's CEO at NamesCon: Domain Liquidity for the industry

[Rob Monster]

Earlier this morning, I wake up to seeing a lovely comment from Shane Cultra on his blog:

To my eyes, that comment from Shane is actually pretty crazy. Ironically, many people told me unsolicited, that my question was the highlight of the Q&A. This is not the first time that Shane has spoken out of school against me with trash-talk and it probably won't be the last since it shamelessly drives up his page views for his affiliate site. I don't know if anyone has a video of the Q&A section of Aman's keynote but if so, would be great if someone would upload the actual video clip. I believe anyone who objectively reviews my question will find it to be rather selfless. It was a question about domain liquidity. There were 2 parts, and I believe they were reasonable and sincere.

Part 1: Domain Liquidity via Loans

As some folks know, Epik provides interest-free loans secured by domains. This is popular but we cannot lend to everyone in the amounts that everyone might like. Compared to Godaddy, we are a relatively small company without access to the vast pool of capital that Godaddy has access to. I asked if Godaddy would consider extending domain loans to its customers. The lending model is proven. Godaddy has the ability to scale it to a much greater degree. Rather than forcing Godaddy customers to abandon domains to their expiry stream, why not allow Godaddy customers with liquid names to borrow against their portfolio? It seems reasonable to me.


Part 2: Working with US Congress to make domain names a bankable asset.

I have also been a long-time believer in the potential for domain names to be a respected asset class. The challenge there is that the banking industry does not recognize domains as a bankable asset class. People can donate domains to non-profits and can get a write-down for their investment basis, but if you go to a bank and ask to borrow against a 3N.com, they have no idea what you are talking about. The House subcommittee on banking could engage here but we would need some lobbying power to make that happen.

For anyone who has ever studied the history of the housing market, the correlation between the availability of borrowing capacity and the prices of the associated asset is indisputable. When credit is available, asset prices go up. If domain owners could more methodically borrow against their domains at conventional banking rates rather than only from hard money pawnshops that dominate the landscape today, it would be a game-changer for making the pie bigger for everyone.

I will be interested to hear what folks have to say on this very reasonable topic about domain liquidity that can greatly impact the future of the industry.

 

[oldtimer]

@Rob Monster , Godaddy's business model is designed to monetize the dropping domains as a source of revenue for the company and I doubt that they are going to be willing to change that model anytime soon.

The very fact that there is some contrast between Epik's way of doing business and Godaddy's is what has made Epik popular amongst domainers, so why would you want GoDaddy to become like Epik.

I believe you should put all your efforts into creating even more contrast between Epik and other Registrars by coming up with new innovations and giving domainers even more options that perhaps don't exist elsewhere.

I have domains both at Godaddy and Epik and I like each one for different reasons. The very fact that Epik is different than Godaddy has made Epik popular amongst domainers and so I believe that maybe it's best if you just focused on your own projects and created even more new ways to empower domainers instead of messing around with the Big Daddy.

Disclaimer: I like both Godaddy and Epik, but I am not affiliated with either one (or anyone else for that matter, as I like to think of myself as an impartial and free spirited domain intellectual ).

Domain Intellectual, I guess maybe I just coined a new term for the domain Industry.

 

[ikehook]

@Rob Monster

First off I'd like to thank you for reading DSAD.com to find the comment. It means a lot to me that we have people from all walks of life reading our little blog.

I was there during the Q&A portion of the keynote, not anywhere close to Shane, and the first thing I thought when you posed your "questions", was that you were promoting some of the products that could be found at Epik.

In fact everyone standing around me thought the same thing.

Shane addressing that concept on DSAD.com and calling it a "Dick Move", was the point of your post. I'm not certain I agree with Shane that it was a dick move, but rather an opportunity for a CEO, that has a product or service to sell, doing their job as CEO to push their own brand to the best of their ability. The same can be said with this post.

Whether it's appropriate during the Q&A of another CEO can be left to people far smarter and knowledgeable than myself.

But all that aside, the point of this exercise is that you did indeed promote Epik through your question.

PS: You see what I did there? I mentioned DSAD.com in my comment as a form of self serving promotion, with no regrets. Even made it bold, like I'm some sorta marketing genius

Have a great day.

Josh

 

[aishwin]

I witnessed the keynote and when I realized @Rob Monster had a very sincere and brilliant question that can really benefit domain investors on liquidity and a liquid domain being recognized by the government as an asset, I got curious and recorded the video below.

As a domain investor, I found the question very helpful and wished this to be a reality.
Thank you @Rob Monster for being an advocate for every domain investor.

 

[namekart]

I will be interested to hear what folks have to say on this very reasonable topic about domain liquidity that can greatly impact the future of the industry.

I was in the room, and I think the question definitely touched an important issue.

Domain Investors often have their lifetime of savings and investments tied in domains, and it would be great for the industry if there was a way to make them 'bankable', or secure credit from financial institutions against your domains.

For people arguing that GoDaddy wouldn't touch this issue, I tend to disagree. GoDaddy has already entered the "credit" space with "Kabbage", and I think it's only logical for them to consider extending credit products to domain investors, one of their biggest customers base.

-Prakhar Bindal

 

[DanSanchez]

i think we al wish gd would do it.. while we all also know that they will not.

can u elaborate on this plz:

"Rob worked to increase my sales success rate by removing my emotional involvement in the process"

how did you use this process? what was involved and how did Epik/Rob succeed in increasing your sales? im sure this is very interesting to most domainers.

First, Epik parking is a dominant service. The indexing power can work wonders if your inquiries are low. I was using Bodis and my inquiries would vary greatly from 1 to 5 weekly. Epik turned that into 1 to 5 daily by simply focusing only on serving the page needed to collect an offer. I did most of the optimizing on the landing pages so they would display a relevant picture, text, and set higher minimum offers.

Rob knew I was under a lot of pressure with my daughter coming and I was bombing every inquiry with sarcasm. It was very difficult for me to be told I was sucking at my job. But I took it and shifted to let Rob handle some of the inquiries to help close sales quickly. Keep in mind I'm carrying 5000+ domains. My capital requirements are high. I was headed for serious trouble.

Rob introduced some mentality shifts that helped me relax, hunker down, and outperform my stress. It continues to work. In fact it has played into my strengths and I am at a height that I wasn't expecting to get to in such short period of time.

Rob has built the systems, anyone can use them to improve. You just have to be willing to take critique and apply it quickly.

I have since become dedicated to projects that will further help domainers like NameLiquidate and NameBrokers to name a few.

 

[Ivan Rasskazov]

Liqudity requires a functional market - having several major marketplaces that don't even communicate with each other is not it. The industry has really taken a step back in general over the past few years in terms of information sharing and the like. The truth is, it needs to cooperate and share more than ever in order to have an iota of a chance at true lobbying power, which is in fact required. You have to keep in mind that lobbying power and transition into commoditization also requires regulation. You'd have to prepare to deal with the CFTC (as an example) or SEC, and things like The Patriot Act. "But the PA and regulations are evil" is not a viable industry strategy.

I have many thoughts on market liqudity and loans. It's an interesting topic. Personally, I don't think House Banking Committee is the way to go for a small industry. There is a blue print for this, and it's in the commodity space, but that's my opinion.

If you want liquidity, start with information sharing and transparency first.

 

[branding]

I voted this thread is stupid.

Who cares what Shane thinks? If you're looking to disrupt a market, and we know you are, there will always be haters and people pushing back. Stick to your plan, don't let other people get to you with their negativity and keep asking questions.

That being said, judging by what you posted you raised some valid questions but I agree it's probably not in GDs best interest to discuss this or even work on new ways to improve the status quo.

 

[Rob Monster]

First, Epik parking is a dominant service. The indexing power can work wonders if your inquiries are low. I was using Bodis and my inquiries would vary greatly from 1 to 5 weekly. Epik turned that into 1 to 5 daily by simply focusing only on serving the page needed to collect an offer. I did most of the optimizing on the landing pages so they would display a relevant picture, text, and set higher minimum offers.

Rob knew I was under a lot of pressure with my daughter coming and I was bombing every inquiry with sarcasm. It was very difficult for me to be told I was sucking at my job. But I took it and shifted to let Rob handle some of the inquiries to help close sales quickly. Keep in mind I'm carrying 5000+ domains. My capital requirements are high. I was headed for serious trouble.

Rob introduced some mentality shifts that helped me relax, hunker down, and outperform my stress. It continues to work. In fact it has played into my strengths and I am at a height that I wasn't expecting to get to in such short period of time.

Rob has built the systems, anyone can use them to improve. You just have to be willing to take critique and apply it quickly.

I have since become dedicated to projects that will further help domainers like NameLiquidate and NameBrokers to name a few.

It is true, Dan is crushing it. He was a willing and able student and is a joy to have on the team. We have a few folks like that on the Epik team that I believe will go on to do great things. Some of them make more money domaining than they earn directly from Epik in compensation. This is of course a form of empowerment, and in fact it all started with a domain loan that kept Dan from losing his portfolio.

I have @Tia Wood to thank for that because it was her who brought this distress situation and we were able to turn it around very quickly with high impact. Dan is now debt-free and playing to his strengths while working from home near his new baby girl, Delilah Grace Sanchez. See picture below. I call that a success story for empowerment.

There are a lot of distress cases in this industry where people are trying to pay for schooling, feed their families, etc. It would be a game-changer that would transform a lot of lives if Godaddy would consider taking a page out of the Grameen bank playbook and introduce microlending. This is a billion dollar idea for them and I share it openly.

 

[garptrader]

Once upon a time the bulk of Aftenic sales were reported and Godaddy published a monthly summary report of Godaddy Auction results. What happened to the transparency? Godaddy benefits from the millions of domain renewals from investors as well as margins from expiring domain auctions on their platform mostly from investors. Yet what tools do they provide reporting-wise to aid in gauging the market? What are they doing to promote premium domains to end users rather than offering dozens of cheaper alternatives to those same potential buyers? How can a prospective domain investor assess the industry's potential? Godaddy is positioned to provide the tools yet what do they provide?

 

[equity78]

Promotional banner of Epik is again in General Discussion thread.

I disagree, he was called out as pulling a dick move, so I understand trying to get the communities thoughts.

If no one is allowed to mention their name anywhere in General discussion then I will let the mods know I am going to spend however long reporting every post where someone mentions their name or company or similar name they own to a service and they can delete a ton of posts.

 

[SuperBrander]

Based on his speech, the CEO of Godaddy seems like a resourceful guy who's sincerely interested in valuing domainers as customers and listening to their feedback.

At the moment, Godaddy forces domainers to pay for a "discount club" in order to get renewal prices that any other registrar offers without having to pay a lot of money for a discount club. They also charge $4.99 to add a Reserve to auctions and make things difficult with the 60 day lock in order to restrict migration (I was just forced to renew a domain there for $18 because of that stupid imposed lock for a purchased domain Godaddy pushed into my account without waiving the lock. This isn't a win for Godaddy. It's something that antagonizes me as a customer and will impact my future decisions).

I don't think Godaddy will ever give domainers loans or help them liquidate their expiring domains. But if Godaddy really wants to help domainers and encourage them to use Godaddy as a registrar and a marketplace they can start by addressing some of the other issues I mentioned - give domainers normal renewals without having to pay for the discount club, eliminate the paid Reserve, be flexible with the lock and in general start treating domainers like partners instead of cash cows.

@Joe Styler

 

[DanSanchez]

Liquidity as a topic, service, and solution will drive the next decade of winners into the stratosphere. I see it becoming an issue during the next economic recessive period in a major way. It's one of the many reasons I chose to join Epik permanently.

Rob gets it. I am part of the group of domainers that utilized this service successfully before joining Epik. It works and I can confirm Epik did not seize any of my inventory to demand payments. Instead, Rob worked to increase my sales success rate by removing my emotional involvement in the process. I learned to add value by being the user of the service.

Godaddy should encourage portfolio liquidity. The benefits we have experienced as a company have outperformed any marketing campaign or forum ad ever. I won't hold my breath though. I have been a Godaddy critic since the beginning of my career and their policies have only fallen further away from justice. It is not capitalism, it is controlled mercantilism.


Finally, having to evaluate hundreds of portfolios has helped me see the big picture. We need help closing sales, tracking inquiries, and maintaining a system of follow up that rivals the best industries today. We can experience profit margins higher than almost any industry, we need to organize and conquer our sales inquiries. Domainers need to stop buying, renewing, and slinging garbage. There are so many great opportunities daily, yet I see so many portfolios with "personal" acquisitions that boggle down profit margins into negative integers

Cheers!

 

[Lox]

...would be great if someone would upload the actual video clip.

intro (more clips @ kickstartcommerce youtube)

 

[biggie]

Rather than forcing Godaddy customers to abandon domains to their expiry stream, why not allow Godaddy customers with liquid names to borrow against their portfolio? It seems reasonable to me.

Hi


if that is the premise, then it is fallacious

why?

since no registrar forces any person to register a domain, then
GD or any other registrar doesn't "force" any registrant to abandon their domains.

the other aspect is valuation of a portfolio

for an owner to borrow against a portfolio, then the valuator would have to be universally accepted

and GD would have to prevent appraisal for unregistered domains, to have a "control" over valuation for existing registered domains.

the other issue would be nglt's, cctlds, idn's etc, etc when it comes to appraisal values and trying to get consensus on value.

sorry, but I wouldn't have entertained an answer either, when or if it was an out of the blue question.

something like that, probably should have been discussed through a scheduled meeting.


imo….

 

[Rob Monster]

people do not let liquid names expire..

As CEO of a top-50 registrar that sees an expiry stream before you do, I will tell you that you are wrong.

 

[Rob Monster]

Want to hear something fascinating?

I took a phone call today from a manager at PayPal. They had been pitching Epik on a sizable loan through one of their business units. The conversation had abruptly stopped last week during NamesCon and I was curious to get some intelligence on why. Well, I got the answer this morning. The reason is because they know that some of the capital will be used to lend to others through domain loans. Somehow those dots had gotten connected, even though domain lending is not our core business.

Like it or not, the system is rigged. Empowerment is more than rhetoric. If Godaddy thinks that a Kabbage affiliate program is compatible with empowerment, then we are going to have very different definitions of empowerment. In fairness to Aman, I am going to guess that the Kabbage affiliate deal was already in motion even before Aman got there, so now is a good time for Godaddy to take inventory of the present reality of the industry and how it aligns with the rhetoric of empowerment.

The industry can do better and must do better. Godaddy has an opportunity to be a friend of the industry rather than preserving the long legacy of exploiting ignorance. For avoidance of doubt, my comments on the floor was absolutely not combative in any way. It was a genuine invitation to the new CEO to deliver on the rhetoric of empowerment. Otherwise, talk is cheap.

At the end of the day, helping Peter Askew (great guy) drop-ship 48,000 pounds of onions is cool but when it comes to empowerment, I think the impact of lifting folks up in emerging markets will be many orders of magnitude greater. We can start really small, e.g. $100 micro-loans to emerging market domain investors would be an insignificant amount of money but combined with education can lift up many.

Those who wish to sweep this topic under the rug by claiming nonsense about lack of decorum are a disservice to the industry. Let's not forget that the entire Keynote was an advertorial for Godaddy observed by a packed room of people who mostly paid to be there. The irony of this is pretty thick. So, let's thank Godaddy for inviting a conversation. That was the classiest part of the whole thing.

 

[equity78]

Part 1: Domain Liquidity via Loans

As some folks know, Epik provides interest-free loans secured by domains. This is popular but we cannot lend to everyone in the amounts that everyone might like. Compared to Godaddy, we are a relatively small company without access to the vast pool of capital that Godaddy has access to. I asked if Godaddy would consider extending domain loans to its customers. The lending model is proven. Godaddy has the ability to scale it to a much greater degree. Rather than forcing Godaddy customers to abandon domains to their expiry stream, why not allow Godaddy customers with liquid names to borrow against their portfolio? It seems reasonable to me.

If that was the question I think it's a fair question, it would be interesting to hear how they feel on that topic, especially at a conference they own.

 

[Mister Funsky]

Unexpected obligations kept me from my road trip to Austin...even bought a cargo van so my dog and I could travel and stop for local flavors along the way (put a couch, microwave and dorm fridge in it so I could travel in style).

I am glad Rob is out there innovating and speaking up on behalf of the industry. If those in higher postions (registrars, etc.) don't intervene, I am afraid it will be slowly dismantled by regulation and international fragmentation.

btw, I am familiar with Braden Pollock because of his affiliation with epik, but truth be told I will have to giggle the poster of the tweet Rob has referred to above...I've heard/seen the name and assume they are a domainer.

 

[Rob Monster]

We already read Shane's blog and Rob also gave his version of what took place, and they both have different opinions about what occured. I think it's time for us to view the video and form a objective opinion...

There is definitely a video out there of the full Q&A so hopefully it turns up. It was very sincerely a question about making the pie bigger and inviting the new CEO of the industry behemoth to lead in a couple of important areas that would help the industry enormously. As the economy becomes progressively more digital, it is inevitable that the raw land of the Internet will become bankable, particularly to the extent that we make it safe for regulated lenders. To do that, we need help from regulators. We also need to make it easy for regulators to not get it wrong, e.g. with things like objective appraisals and possibly domain insurance so that the bank can be insulated from unforseen risk factors when lending against a domain. I really believe this area is scope for an industry breakthrough but it needs strong industry sponsorship.

 

[Rob Monster]

@Rob Monster , Godaddy's business model is designed to monetize the dropping domains as a source of revenue for the company and I doubt that they are going to be willing to change that model anytime soon.

The very fact that there is some contrast between Epik's way of doing business and Godaddy's is what has made Epik popular amongst domainers, so why would you want GoDaddy to become like Epik.

I believe you should put all your efforts into creating even more contrast between Epik and other Registrars by coming up with new innovations and giving domainers even more options that perhaps don't exist elsewhere.

I have domains both at Godaddy and Epik and I like each one for different reasons. The very fact that Epik is different than Godaddy has made Epik popular amongst domainers and so I believe that maybe it's best if you just focused on your own projects and created even more new ways to empower domainers instead of messing around with the Big Daddy.

Disclaimer: I like both Godaddy and Epik, but I am not affiliated with either one (or anyone else for that matter, as I like to think of myself as an impartial and free spirited domain intellectual ).

Domain Intellectual, I guess maybe I just coined a new term for the domain Industry.

I have no animosity towards Godaddy at all. We are a tiny company by comparison. The industry benefits when the industry titan adopts ideas that have been tested elsewhere. By now it is not a secret that we don't care who makes money or who takes credit, as long as we make the pie bigger for a lot more people.

 

[.X.]

A couple of things, Godaddy knows that without that aftermarket place they have, they would damn near be out of the domain name business, their inventory is loaded with quality names, on the flip side, their name appraisal tool is a bit deceptive, not to the experienced domainer, but to new domainers and a person that may be just registering a name for fun or business. I believe it can give people a very false sense of accomplishment and value of a name therefore making them want to purchase more names,

why does this affect anyone?? Because these types of programs and tools can influence even end users as to what they think they should or should not offer for a domain name, before you know it , It becomes the status quo guide for domain name value to the complete domain name industry. Domainers and end users buyers.

To my knowledge, it appears the algorithm uses “similar sales” of domain names as its core for valuation. The Godaddy appraisal is useful for seeing what similar names have sold for, I do not see any metrics of SERP stats, global searches vs exact searches and ect to help aid in its valuation process.

I have always liked Godaddy, I don’t dislike GD now, I am a bit disappointed in lack of acknowledgement to the domainer and the domain name industry, as well as lack of sufficient transparency in the aftermarket place, but most of all, the lack of customer relations as that used to be their strong point IMO

 

[eyedomainous]

As Godaddy provides 'estimated values', creates 'premium domains' and boast "GoDaddy Domain Appraisals gives you the most accurate estimate available. Our exclusive algorithm combines machine learning with real-market sales data compiled from our 20 years of experience."

The question is spot on... will they put their money where their mouth is?

Perhaps a more important question, than liquidity;

Will Godaddy leverage its publicly traded status and recently relaxed VC capital / fund raising rules to drive domain development investments on its upgraded (biz) tech services platform?

Now THAT would be an industry game-changer.

 

[.X.]

Loan against domains "What a brilliant idea" I love it. I have been using Godaddy for almost 5 years now. Dec last year, I saw what GD was charging for, that was free on Google and the complete package was way cheaper. I have already started shifting. Then I joined NamePros, now I think I was a Fool for the past 5 years. As per my thinking, GD has become big because people don't know about the other great companies.

I don't know what he said and what you said. But I will back this idea of "Loan Against Domains". I know when mergers and acquisitions take place the domain name is also valued. In this age when e-com companies are giving financial help to the consumers Then why can't this be done on the domain industry. Now rest is all Blame Game Name...

P.S- Now, I am on Epik as well., so on Porkbun

if GD gave loans on domains based off their domain valuator, I could actually start a hustle simply taking out loans on my names

 

[Bob Hawkes]

What you didn't know was Rob challenged his psychology students the day before to ask Senator Bob one question! "Should high school students be required to pass a drug test in order to graduate from high school?" That seems like an innocent enough question, right? Senator Bob is way too smart to fall for that one . . .

How did I get into this thread I was avoiding?

I mainly have this to say:

"As far as possible, without surrender, be on good terms with all persons. " - Desiderata​

I hope in many places on NamePros, including here, we can turn down the flames that erupt now and then. I respect all of those involved.

At most conferences I attend, many speakers get asked questions that really have some agenda behind them. Some with an apparent agenda may not deliberately do that, but they are asking questions from their worldview on topics they feel passionate about. Most people in leadership get good at deflecting questions they do not wish to handle. It's not a big thing as long as everyone is polite.

I personally feel that most in domain investing should follow the mantra invest only what you can afford to lose. As such, I see some danger in domain loans, but if done at all, they should be within a business framework, such as the theoretical models @Ategy cites above as a bridge financing. Since models like that show losing money at first, even with a portfolio that will be eventually very successful, the case for domain leveraged short to medium term loans makes sense.

I do see domain names as having values, even though precise valuation is challenging, and as such in principle the idea of domain loans is reasonable. The conditions that @Rob Monster mentions above re how they assess each loan seem sensible to me. The fact they have no foreclosure is impressive. I would never seek a domain loan because that is not how I invest in domains, but I can see having such a program is welcomed by some others.

No company has any obligation to follow the lead of any other company. Some offer payment plans, some do not. It is good we have variety in the industry.

High school students should not be required to pass a drug test to graduate. There should be a minimum number of barriers to education, and they should only be based on educationally justified means.

While being a senator here in Canada would give me lots of money to spend on domains, and seems much easier money than domaining , I actually favour Canada doing away with our Senate. So I am unlikely to ever be a senator.

I think I have commented on all aspects I want to, so I am out again. Keep in mind that I know nothing really about drug testing, domain loans, etc. and was not at NamesCon 2020 .

Bob (non-senator )