Three-letter .ai domain

[ap123]

Hi all,

I've never sold a domain before, and I'm not particularly interested in getting into the business. However, I own a 3-letter .ai domain (drc.ai). I believe all 3-letter .ai domains are taken, so I think it may have a 5-figure value. How do I best pursue a decent sale price? I'm not able to commit a lot of time to this, so I'd be willing to pay a commission. I listed it on atom.com but I haven't received any decent offers.

Thanks for any help!

 

[biggie]

Hi

don’t pay no borker

take a few $ and renew the name,
list on afternic with a price and enable the lease to own option
change nameservers to afternic and wait

imo…

 

[VadimK]

That's an easy one. Go to NameBio.com and check all the sales of 3-letter .ai domains up to today. That can give you a rough idea of what these kinds of names are selling for.

Then go to DotDB.com and check how many TLDs your domain is taken in versus others that have been sold. It's very relative, but it is still one of the quality indicators, especially when there is no keyword. You can compare it with sold ones.

Based on these two factors, you can set your price.

 

[biggie]

Based on these two factors, you can set your price.

Hi


I don’t check either before pricing and still wouldn’t price domains based on such limited data.

there’s a lot more to it than that


imo….

 

[VadimK]

Hi


I don’t check either before pricing and still wouldn’t price domains based on such limited data.

there’s a lot more to it than that


imo….

Well, I was talking specifically about 3-letter .ai domains, not keyword domains, where there is indeed much more to consider. Even here, of course, you can check the list of taken and available 3-letter TLDs, possible abbreviations, trademarks and so on. But the OP is not a domainer, so if a simple rule for setting a price needed, that would roughly be it.

 

[Jannes]

Solid name, DRC is taken in 220 extensions, OpenCorporates.com lists 2,605 active companies. That's more relevant here than the diminished supply of unregistered 3-letter .ai domains. It needs visibility in GoDaddy and Namecheap/Spaceship registration paths (domain search results). So list it on Afternic and Spaceship SellerHub, perhaps Sedo too. Mid to high 5 figures, but that requires some waiting time of course.

Be mindful about Afternic's commission structure (max 30%), so turn off the "boost" (-5%) and use their nameservers (landing pages) (-10%) at least if you list the domain as Buy It Now or BIN/Lease to Own (Make an Offer option gives time to switch to their NS after you in fact get an offer).

 

[bmugford]

Good combo, but unless you want to get closer to a wholesale price it is likely a waiting game like with almost all domains.

You need the right buyer.

LLL.com are the only three letter combos that are easy five figure sales.

Brad

 

[fka1080405]

I believe all 3-letter .ai domains are taken

End user pricing is very different to investor pricing. You sell to an end user based on how much they are willing to spend, which is dictated by the value of the domain to them and how much they can afford to spend. Shorter domains are typically more valuable to end users because they are easier to brand but the domain itself matters, e.g: "drc.ai" is much, much less valuable than "chat.ai".

So, as @Jannes says, if you want 5-figures, the focus should be on finding the right end user for this domain. The fact that it is an acronym used by many companies is more useful than the fact that it is short.

As you're new to domains, I'll elaborate a little more. I guess you've been reading about domains and come across discussions of 3Ls, 4Ls etc:

People in the domain name world will discuss the composition of domain names (e.g: extension, letters, characters, length) because investors are trying to find any signal that indicates the domain might be valuable to an end user someday. That's where investors make their money, on the very few domains that sell to an end user. A .com domain is more likely to be valuable to an end user than a .net, a .ai is more likely to be valuable to a technology company than a .info. A short domain is easier for an end user to brand, a generic keyword domain has more potential end users that want it. "Happy.com" could be used by thousands of different business, "southcarolinarealestate.com" would work for just a few.

As investors, we expect most of our domains to never sell. We might spend $1,000 on registering 100 domains and then sell 1 for $10,000. The 99 that didn't sell, that's okay, that was just the cost of doing business. An oft-quoted number is a 1% Sell Through Rate (STR): investors expect each year to sell 1% of their domain names. If you sell more than 1% of your domains each year, that's good going.

So, as an investor, if we think that drc.ai could sell to an end user for $25k, we can afford to invest some amount in the domain that is less than $25k. We also need to account for the likelihood that the domain doesn't sell (if only 1% are likely to) and we need room for profit too and we need to consider the opportunity cost.

There's no magic formula, every investor is different, every investor has a strategy for how they buy and sell, but in general you could expect an investor to be willing to spend somewhere between 1% and 10% of what they think the end user price is. "Wholesale" and "liquidation" are the words often used when selling to investors.

You therefore have 2 options:

1. Sell to an investor for <10% of the domain's expected end user sale price, e.g: if an investor thinks an end user might pay $50,000 for the domain someday then you could expect to sell it for somewhere around $2,000.

2. Hold on to the domain, indefinitely, until the day that an end user with money wants the domain. Learn about the end user, identify their maximum price, and sell to them.

If you take option 1, you get money immediately and someone else takes on the risk of waiting months, years, decades for an end user. If you take option 2, you'll probably never get any money, but if you do get money then it'll be a much higher amount.

Beyond this, there are a small number of "liquid" domains that are so in demand that investors are willing to pay much more than a small percentage of the expected end user value because they know that they could always find another investor to buy the domain off of them. You will often see people talk about the "floor" price of certain categories of domains, e.g: the floor price of an LLL.com is ~$15k, because investors collectively recognise that an LLL.com has high potential for a sale to an end user.

For comparison to LLL.com, the second most popular extension (.net) has a floor price of an LLL.net of around $300. As you can see, the extension matters a huge amount. For LLL.ai, the market hasn't yet decided that LLL.ai's have enough potential that there is a meaningful floor price: it is possible to buy an LLL.ai for ~$100 today.

A good next step is to answer these questions:

1. Do you need to sell this domain or are you happy to keep renewing it forever?

2. How much would you need to be offered to accept a sale?

That'll help determine your path forward

 

[enterscope]

List on Spaceship.com it's only 10% commission, but also list on Sedo and Afternic, just use Spaceship lander.

I would price at $75,000 and be prepared to wait for years.

DRC are top tier letters

 

[forge]

I would price at $75,000 and be prepared to wait for years.

for eternity.

Fixed.

 

[forge]

Nevertheless it's a solid LLL.ai

 

[ap123]

Thanks all, for the helpful information and tools. I'm not in a huge rush to sell, so based on this advice it sounds like I should:
- List on afternic and Sedo (starting a bit high at $50k?)
- switch nameservers to Spaceship for lower commission
- Start reaching out to companies from OpenCorporates.com

Does that sound reasonable? And I'll gradually lower price over time if I'm not getting any traction.

 

[fka1080405]

- List on afternic and Sedo (starting a bit high at $50k?)

Yes, list everywhere, there's no disadvantage: Afternic (GoDaddy) + Sedo + Spaceship + Atom + any other platforms you come across.

- switch nameservers to Spaceship for lower commission

The landing page you choose to use doesn't matter in theory so choosing based on commission is fine but some people believe that using GoDaddy's landing pages confer more trust which is encouraging to buyers. Personally, I don't believe that, but you'll find different opinions about it around. Most sales do not come through landing pages (they come through registration path upsells).

- Start reaching out to companies from OpenCorporates.com

Set your expectations low. The number of companies that are open to buying a domain name and have the budget is very, very low. The likelihood is that you will not find anyone through outbound. You'll also face an uphill battle with getting emails through due to how common domain name sale spam is, most filters kill it immediately. Cold outreach via LinkedIn is more likely to get your message through. If you do use email, be selective.

You will also need to prepare yourself for the tiresome trademark complaints and threats... be prepared for when you do get a response, to hear endless threats from business people about how you should just give them the domain because they have a trademark and they will sue you and blah blah blah. The threats are empty, not grounded in any reality, but maybe spend some time reading up on the UDRP so you can engage with them in confidence.

Sometimes, legal threats can be a sign they want the domain and they are just bad negotiators, other times it can be a sign they just love to argue and have no interest in paying for the domain.

Does that sound reasonable? And I'll gradually lower price over time if I'm not getting any traction.

Price isn't very important. A domain priced at $10,000 is not necessarily less likely to sell than the same domain priced at $1,000. Every single domain for sale today could have its price cut by 90% and very few would sell because of it. Adjusting the price doesn't create demand, it can only make it easier for interested parties to buy the domain. The hardest part is finding interested parties. There are zero interested parties for most domains. Once you have an interested party, then the question is about what they're willing to spend, which is dictated by their circumstance, not how you have priced the domain.

So, gradually lowering the price over time is pointless.

 

[enterscope]

I wouldn't reach out to any companies if you want to make five figures. It's best too wait patiently for them to want it and reach out to you. That gives you more leverage.

If you contact companies about it, chances are they won't care or think they need it, and you might get a grand for it.

 

[ap123]

The landing page you choose to use doesn't matter in theory so choosing based on commission is fine but some people believe that using GoDaddy's landing pages confer more trust which is encouraging to buyers. Personally, I don't believe that, but you'll find different opinions about it around. Most sales do not come through landing pages (they come through registration path upsells).

Ok, but how should I execute the sale in terms of using an escrow service with a low commission?

 

[Digitally Dignified]

End user pricing is very different to investor pricing. You sell to an end user based on how much they are willing to spend, which is dictated by the value of the domain to them and how much they can afford to spend. Shorter domains are typically more valuable to end users because they are easier to brand but the domain itself matters, e.g: "drc.ai" is much, much less valuable than "chat.ai".

So, as @Jannes says, if you want 5-figures, the focus should be on finding the right end user for this domain. The fact that it is an acronym used by many companies is more useful than the fact that it is short.

As you're new to domains, I'll elaborate a little more. I guess you've been reading about domains and come across discussions of 3Ls, 4Ls etc:

People in the domain name world will discuss the composition of domain names (e.g: extension, letters, characters, length) because investors are trying to find any signal that indicates the domain might be valuable to an end user someday. That's where investors make their money, on the very few domains that sell to an end user. A .com domain is more likely to be valuable to an end user than a .net, a .ai is more likely to be valuable to a technology company than a .info. A short domain is easier for an end user to brand, a generic keyword domain has more potential end users that want it. "Happy.com" could be used by thousands of different business, "southcarolinarealestate.com" would work for just a few.

As investors, we expect most of our domains to never sell. We might spend $1,000 on registering 100 domains and then sell 1 for $10,000. The 99 that didn't sell, that's okay, that was just the cost of doing business. An oft-quoted number is a 1% Sell Through Rate (STR): investors expect each year to sell 1% of their domain names. If you sell more than 1% of your domains each year, that's good going.

So, as an investor, if we think that drc.ai could sell to an end user for $25k, we can afford to invest some amount in the domain that is less than $25k. We also need to account for the likelihood that the domain doesn't sell (if only 1% are likely to) and we need room for profit too and we need to consider the opportunity cost.

There's no magic formula, every investor is different, every investor has a strategy for how they buy and sell, but in general you could expect an investor to be willing to spend somewhere between 1% and 10% of what they think the end user price is. "Wholesale" and "liquidation" are the words often used when selling to investors.

You therefore have 2 options:

1. Sell to an investor for <10% of the domain's expected end user sale price, e.g: if an investor thinks an end user might pay $50,000 for the domain someday then you could expect to sell it for somewhere around $2,000.

2. Hold on to the domain, indefinitely, until the day that an end user with money wants the domain. Learn about the end user, identify their maximum price, and sell to them.

If you take option 1, you get money immediately and someone else takes on the risk of waiting months, years, decades for an end user. If you take option 2, you'll probably never get any money, but if you do get money then it'll be a much higher amount.

Beyond this, there are a small number of "liquid" domains that are so in demand that investors are willing to pay much more than a small percentage of the expected end user value because they know that they could always find another investor to buy the domain off of them. You will often see people talk about the "floor" price of certain categories of domains, e.g: the floor price of an LLL.com is ~$15k, because investors collectively recognise that an LLL.com has high potential for a sale to an end user.

For comparison to LLL.com, the second most popular extension (.net) has a floor price of an LLL.net of around $300. As you can see, the extension matters a huge amount. For LLL.ai, the market hasn't yet decided that LLL.ai's have enough potential that there is a meaningful floor price: it is possible to buy an LLL.ai for ~$100 today.

A good next step is to answer these questions:

1. Do you need to sell this domain or are you happy to keep renewing it forever?

2. How much would you need to be offered to accept a sale?

That'll help determine your path forward

Really enjoyed this. While I only skimmed it, I came off as well though out.

 

[fka1080405]

Ok, but how should I execute the sale in terms of using an escrow service with a low commission?

If the sale comes via one of the marketplaces / platforms you have listed on then you will be subject to their escrow process and their commission, you cannot bypass that. For example, if someone buys your domain via GoDaddy (Afternic) you will pay ~25% commission. A common strategy is to price your domains higher on more expensive marketplaces to offset the commission, e.g: my domains are priced ~10% higher on GoDaddy (Afternic) when compared to Spaceship and DomainEasy.

If someone reaches out to you directly, not via a marketplace or landing page, then you can choose to use a "checkout link" which is an option supported by most marketplaces that has very low commission, e.g: if your buyer wants to pay via GoDaddy (because they trust GoDaddy) then you can use an Afternic checkout link which only has a 5% commission fee (regardless of the landing page).

Commission via GoDaddy is high because they're the best source of sales, they can afford to take a bigger cut (without driving away investors): they deliver at least 1/3rd of all domain name sales. Some investors choose not to use GoDaddy because of a moral opposition to GoDaddy's high commission and those people make less sales.

If your focus is on paying the least amount of commission possible then do not use any marketplaces and instead just have a plain landing page with an email address, once someone reaches out to you to purchase the domain directly then you can set up a transaction using Escrow.com. Escrow.com is very cheap and very secure