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.

 

[frank-germany]

@Rob Monster For me and I know for a lot of others has been of tremendous value. 24/7 access, Closing deals over the phone with buyers, helping coordinate payments that no other registrar could handle, and being genuine and sharing insights on a daily basis has turned my side hobby into something that makes real money. Thank you Rob for all you do. It seems the old cult of domainers talk bad because new investors to the industry are eating at their profits.

-KG

I can asure you
that none of your success will ever be able
to cut into my profits

and nobody has ever complained about Rob helping domainers

he is doing a great job with that
no doubt

when you listen more carefully
you will find
that the critique is about different issues
than that

 

[bballdude823]

I can asure you
that none of your success will ever be able
to cut into my profits

and nobody has ever complained about Rob helping domainers

he is doing a great job with that
no doubt

when you listen more carefully
you will find
that the critique is about different issues
than that

We were given two ears and one mouth for a reason. I know the issues. I was giving acknowledgement to @Rob Monster who has supported me in many ways. Have a great day

 

[Hazel Benedict]

If GoDaddy has created a Domain Name Appraisal tool and also shows this Appraisal amount within GoDaddy Expired Domain Name auctions. Further, they even go so far as showing "Comparable Domains Sold" and the Price.
If GoDaddy won't address creating an asset class for Domain Names or lending against the "Domain Name Appraisal" they suggest, just shows GoDaddy is "puffing" up the domain name for increasing the bids to make more money off the person allowing the domain name to expire. If GoDaddy is willing to do this, QUESTION: Why won't GoDaddy put their money where their mouth is, given they created this "Domain Name Appraisal" tool and lend money to persons for their domains?
QUESTION: Why is GoDaddy not violating either Federal or State law (Terms and Conditions can be trumped by certain laws), in selling a Domain Name Asset let by choice, omission or mistake, to expire that is actually still owned by the person (According ICANN), since it is still in redemption and can be redeemed?
Then lure domainers to buy them at inflated prices because they publish their Appraisal and Comparable Domains Sold.
Just wondering.
Hazel

 

[Rob Monster]

If GoDaddy has created a Domain Name Appraisal tool and also shows this Appraisal amount within GoDaddy Expired Domain Name auctions. Further, they even go so far as showing "Comparable Domains Sold" and the Price.
If GoDaddy won't address creating an asset class for Domain Names or lending against the "Domain Name Appraisal" they suggest, just shows GoDaddy is "puffing" up the domain name for increasing the bids to make more money off the person allowing the domain name to expire. If GoDaddy is willing to do this, QUESTION: Why won't GoDaddy put their money where their mouth is, given they created this "Domain Name Appraisal" tool and lend money to persons for their domains?
QUESTION: Why is GoDaddy not violating either Federal or State law (Terms and Conditions can be trumped by certain laws), in selling a Domain Name Asset let by choice, omission or mistake, to expire that is actually still owned by the person (According ICANN), since it is still in redemption and can be redeemed?
Then lure domainers to buy them at inflated prices because they publish their Appraisal and Comparable Domains Sold.
Just wondering.
Hazel

Reasonable questions there.

I think the answer is likely that there is a distinction between (1) a retail scenario with a motivated buyer and available funds versus (2) a wholesale liquidation scenario.

Domainers of course understand the difference. Retail customers who buy into the "real estate of the internet" metaphor could be blind-sided by the range of price scenarios.

Godaddy could take a page out of Cross River's playbook and just operate the lending arm at arms length.

Earlier today, I did ask our lead-designer to start working on a mock for DomainEquity.com as a peer to peer lending engine. In theory it would work with any registrar but out of the gate, it will integrate with Epik.

I do think there will be some innovation in this space in 2020.

It remains to be seen if Godaddy will do anything beyond send people to Kabbage -- an arms-length lender that will -- as I understand it -- not collateralize the domain but will lend with full recourse on all assets.

 

[Internet.Domains]

If GoDaddy has created a Domain Name Appraisal tool and also shows this Appraisal amount within GoDaddy Expired Domain Name auctions. Further, they even go so far as showing "Comparable Domains Sold" and the Price.
If GoDaddy won't address creating an asset class for Domain Names or lending against the "Domain Name Appraisal" they suggest, just shows GoDaddy is "puffing" up the domain name for increasing the bids to make more money off the person allowing the domain name to expire. If GoDaddy is willing to do this, QUESTION: Why won't GoDaddy put their money where their mouth is, given they created this "Domain Name Appraisal" tool and lend money to persons for their domains?
QUESTION: Why is GoDaddy not violating either Federal or State law (Terms and Conditions can be trumped by certain laws), in selling a Domain Name Asset let by choice, omission or mistake, to expire that is actually still owned by the person (According ICANN), since it is still in redemption and can be redeemed?
Then lure domainers to buy them at inflated prices because they publish their Appraisal and Comparable Domains Sold.
Just wondering.
Hazel

You bring up some good points. First, it must be established that domains are digital assets. By definition, it's been concluded that domains are digital assets.

Digital assets are governed by RUFADAA, in the United States.The law is considered newer and there is no precedent for many items to be challenged.

Regular assets, such as real estate, has specific definitions for "appraisal" and "valuation" with major differences between the two. An appraisal is formal, it is done by an unbiased third party. A valuation is informal.

When speaking in terms of digital assets, appraisals should be the same as regular assets, in that any appraisal should be unbiased and not be done by a company who would profit from a higher appraisal or lose profits with a lower appraisal. Simply, appraisals should be done by independent, unbiased third parties.

Imagine inheriting a portfolio of domains and having to pay a higher than needed inheritance tax on a portfolio if weak domains. With unfair and biased high appraisals the tax would be burdensome to many.

Registrars should not be in the appraisal business. Too much is at stake and registrars do not meet the legal definition as being unbiased.

 

[nothere]

When speaking in terms of digital assets, appraisals should be the same as regular assets, in that any appraisal should be unbiased and not be done by a company who would profit from a higher appraisal or lose profits with a lower appraisal. Simply, appraisals should be done by independent, unbiased third parties.

Imagine inheriting a portfolio of domains and having to pay a higher than needed inheritance tax on a portfolio if weak domains. With unfair and biased high appraisals the tax would be burdensome to many.

Registrars should not be in the appraisal business. Too much is at stake and registrars do not meet the legal definition as being unbiased.

Maybe the service can be done like this:

I have domain.com and I need a loan so I join the site and post the ad. John sees my listing there and agrees to lend me $xxxx for it. James offers $yyyy. I choose James' offer.
No need to appraisals, the lender does it. Then, I can either pay the loan in time or surrender my name.

after edit: if the place is flooded with mykoolzdomanz.net type domains a moderator (maybe helped by automated valuation tool) can clean the place up so good names are not lost. Maybe list good names first? Epik, then, can bid as anyone else would, or just be the marketplace. Epik would have to do the legal part and of course keep a cut to keep the lights in.

 

[Rob Monster]

Maybe the service can be done like this:

I have domain.com and I need a loan so I join the site and post the ad. John sees my listing there and agrees to lend me $xxxx for it. James offers $yyyy. I choose James' offer.
No need to appraisals, the lender does it. Then, I can either pay the loan in time or surrender my name.

The thinking with DomainEquity.com serves a a clearing house for peer to peer lending.

The concept is that the registrant verifies domain ownership using auth codes (similar to NameLiquidate.com) and then lenders can propose to lend against some or all.

The legal relationship is a classic "sale and lease back" with the market-maker enforcing the terms of the agreement.

As envisioned, the platform is registrar-agnostic and could work with any registrar that is willing to enforce agreements, similar to how any registrar can enforce a UDRP lock.

What do folks think of the name DomainEquity.com for this peer-to-peer lending platform?

 

[Internet.Domains]

What do folks think of the name DomainEquity.com for this peer-to-peer lending platform?

As good as any.

 

[oldtimer]

What do folks think of the name DomainEquity.com for this peer-to-peer lending platform?

Can you work some philanthropy into the peer to peer system so that people can also get grants that they don't have to pay back for those who just need a small amount of money to get past a difficult or stressful situations, after all there are a lot of well off domainers who might be able to help their fellow domainers out of a sticky situation.

In another words put grants and loans on the same P2P platform.

IMO

 

[FlipperC]

The concept is that the registrant verifies domain ownership using auth codes (similar to NameLiquidate.com) and then lenders can propose to lend against some or all.

does this mean the registrant has to transfer domain to epik? is that how verificiation done?

so you benefit by running this sservice and at the registrar???

As envisioned, the platform is registrar-agnostic and could work with any registrar that is willing to enforce agreements, similar to how any registrar can enforce a UDRP lock.

i think you should work with other registrars before building to show it will be agnotstic. otherwise, it wont be.

What do folks think of the name DomainEquity.com for this peer-to-peer lending platform?

doesn't seem best. you provide cash with domain as asset. domaincash? domain.cash?

 

[Rob Monster]

Can you work some philanthropy into the peer to peer system so that people can also get grants that they don't have to pay back for those who just need a small amount of money to get past a difficult or stressful situations, after all there are a lot of well off domainers who might be able to help their fellow domainers out of a sticky situation.

In another words put grants and loans on the same P2P platform.

IMO

Actually, the design inspiration for the concept is GoFundMe. So, yes, you could have folks chip in a subsidy, or pay down someone else's domain loan. We'll see what @Ala Dadan conceives there.

 

[Rob Monster]

does this mean the registrant has to transfer domain to epik? is that how verificiation done?

so you benefit by running this sservice and at the registrar???



i think you should work with other registrars before building to show it will be agnotstic. otherwise, it wont be.



doesn't seem best. you provide cash with domain as asset. domaincash? domain.cash?

No domain transfer required -- just use the the auth code to verify ownership unless ownership has been verified otherwise.

The architecture will be open. Same story with WHOQ.com -- it is registrar agnostic and uses host records for verification.

Brand-wise, strongly favor .com. The "equity" was a play on words, i.e. "fair". However, open to other suggestions there. Still in the planning stage.

 

[oldtimer]

Actually, the design inspiration for the concept is GoFundMe. So, yes, you could have folks chip in a subsidy, or pay down someone else's domain loan. We'll see what @Ala Dadan conceives there.

And also to be able to give a grant directly to those who need a small amount of money to get by in addition to helping others pay off their existing loans.

IMO

 

[Rob Monster]

And also to be able to give a grant directly to those who need a small amount of money to get by in addition to helping others pay off their existing loans.

IMO

Sure, the verified domain owner can describe their project in words and images similar to a GoFundMe listing and get loan offers or invite donations or both. I think the platform should allow both.

Since working a lot more in emerging markets, I have heard many more stories. The Nigerian domainer who was selling a domain to buy rabbit cages before starting his university studies ranks near the top.

Anyway, good input. I think we should accommodate the donation scenario. The donors can then be recognized. And if the domain owner later sells his domain for a windfall, he/she can return the generosity.

 

[oldtimer]

Sure, the verified domain owner can describe their project in words and images similar to a GoFundMe listing and get loan offers or invite donations or both. I think the platform should allow both.

Since working a lot more in emerging markets, I have heard many more stories. The Nigerian domainer who was selling a domain to buy rabbit cages before starting his university studies ranks near the top.

Anyway, good input. I think we should accommodate the donation scenario. The donors can then be recognized. And if the domain owner later sells his domain for a windfall, he/she can return the generosity.

And in the process of facilitating and running this platform I don't think that it's unfair for Epik to make a little money so that Rob can take care of his employees.

IMO

 

[Ala Dadan]

Actually, the design inspiration for the concept is GoFundMe. So, yes, you could have folks chip in a subsidy, or pay down someone else's domain loan. We'll see what @Ala Dadan conceives there.

We have started the design efforts on this platform, hopefully, the initial screens will be ready very soon. I will also keep an eye on this thread. a lot of useful information being posted.

 

[nothere]

I would choose a name with fund /funds in the end then. It's more inclusive and leaves room for a lot of new features @Rob Monster

 

[trelgor]

I have loans on domains dotcom. You can have it if you want. Domain Equity sounds more shared ownership oriented. The perfect brand would be more generally digital/IP asset related not to limit the scope. I can’t seem to find a catchy one. Bankable dotcom? (Looks like FS). Bankability dotcom looks to be in a corporate burial ground. Fund Labs dotcom? (Self promotion alert!)

 

[Rob Monster]

Empowerment comes in many forms.

Here is @Samuel Adebo, a member of the Epik team in Nigeria, teaching some folks about domain names earlier today in the streets of Ota, Nigeria about 100 miles outside of Lagos.

These folks get access to a free course. However, if they don't have a credit card, their options for getting started as domain investors are more limited. However, if you take a $0.99 .CO promo and lend a new investor account credit credit of even $25, they can go buy 25 hand-picked .CO domains and flip even 1 of them, he/she has the rest of the year to move the others while re-investing proceeds.

This street team model can be replicated by anyone including Godaddy. The DomainGraduate.com course is free. It is getting ongoing updates and is being translated into local languages. Free tools for finding available domains like NameInvestors.com are also being translated, e.g. the Turkish version which is now more popular even than the English version.

 

[oldtimer]

Empowerment comes in many forms.

Here is @Samuel Adebo, a member of the Epik team in Nigeria, teaching some folks about domain names earlier today in the streets of Ota, Nigeria about 100 miles outside of Lagos.

Show attachment 144346

These folks get access to a free course. However, if they don't have a credit card, their options for getting started as domain investors are more limited. However, if you take a $0.99 .CO promo and lend a new investor account credit credit of even $25, they can go buy 25 hand-picked .CO domains and flip even 1 of them, he/she has the rest of the year to move the others while re-investing proceeds.

This street team model can be replicated by anyone including Godaddy. The DomainGraduate.com course is free. It is getting ongoing updates and is being translated into local languages. Free tools for finding available domains like NameInvestors.com are also being translated, e.g. the Turkish version which is now more popular even than the English version.

It's great to see your empowerment program in action, it might be good to also add the option of giving domain donations along with the grant and loan programs that way people can donate a domain or two directly to the newbies to help them get a head start with their domain ventures.

IMO

 

[Mister Funsky]

What do folks think of the name DomainEquity.com for this peer-to-peer lending platform?

As someone above said, it is as good as any. Since it is a domainer based site/service, there is no need for a top tier name (by the way, I have several that would work ). So this name is more than adequate for its purpose.

By the way, I think the concept of allowing people to 'bid' on a loan amount, as peer to peer service, is light years ahead of where we are now. I would be an active bidder of offering a loan as well as active user of loaned funds, as long as the interest rate is nil or very low. Perhaps an interest rate would invite outside regulation, so a time borrowed or user 'fee' is more appropriate.

Epik could simply add a value based percentage charge or nominal fixed amount for providing the service (hope all that makes sense...up too late domaining and I am out of coffee beans...not a happy camper until I get to the store).

 

[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.

 

[wwwweb]

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.

Wow, great video, it’s a fair question, at a paid conference to the ceo of the company putting on the event. To be honest, it looks like he didn’t know how to answer it, probably not up to speed at this point in time being so new, should have passed it off to somebody else on stage.

 

[Rob Monster]

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.

Thanks Aishwin. Thanks for catching the tail end of that. The question was before the video was rolling. I did notice that NamesCon did catch a photo of the question.

 

[Lox]

after math... (we get a point however ... we're out of time) 00:30