As a real estate and stock market investor with over a decade of experience, I have seen how traditional investing opportunities such as stocks, mutual funds, real estate, bonds, and metals have become less reliable in recent years. At the same time, “real estate” on the Internet, in the form of domain names, is becoming an increasingly profitable arena for investors.
Personally, I have purchased domains for a few thousand dollars and, after a few years, sold them for more than $30,000. Domain names are hot properties for individuals and companies who want to make money on the Internet. Like brand names and slogans, domain names that are easy to remember and can be associated with a product or service can make a world of difference in profit potential. Even catch phrases like “Got Milk” can be turned into a profit center by tacking on a “dot com” to create a key piece of Internet real estate.
Need more proof? Self-proclaimed “Domain King,” Rick Schwartz sold his iReport.com domain name to Turner Broadcasting System, the parent company of CNN, for $750,000. Frank Schilling, who began buying domains in 2002, earned more than $10 million dollars in revenue, ninety-percent of which was profit, in two years, and then more than doubled his revenue and profit two years later.
You might view the Internet and the technology sector as “high risk.” However, the Internet is expected to continue in its exponential growth, similar to the growth that the real estate and stock markets exhibited decades ago.
What are Domain Names?
Domain names are the way in which websites are identified, such as Google.com. When domain names are registered in the Domain Name Service (DNS) and directed to a particular IP (Internet Protocol) address, information can be stored at that location and viewed in an Internet browser, such as Internet Explorer or Firefox.
How Can Domain Names Become a Good Investment?
While investments in stocks and real estate often require substantial know-how and significant amounts of expendable cash, domain name investing opportunities are accessible even to the less financially savvy. Domain names can be purchased for just a few dollars and often “parked” on a web host for free.
Domain name investors can also choose to propagate a website with content that is relevant to the domain name. Attracting visitor traffic to a website can significantly increase the domain name’s value to a potential buyer. Furthermore, passive income can be generated from content, creating cash flow while the value of the domain increases, similar to the way a real estate investor might rent out a property while equity in the property increases.
Reasons Why You Should Invest in Domain Names
As my infographic illustrates, domain name investing costs less and has almost no overhead compared to stocks and real estate. There is a low initial investment and low maintenance costs for a business opportunity that has a high potential for return on investment (ROI). Like real estate, domain name investments allow for a “buy and hold” strategy, but with lower transaction costs in a market that has significantly lower risks. While domain name investing does not offer easy financing, legislation protection, or the option to easily cash out, there is no insurance needed and asset protection can be assured.
If you are overwhelmed by the complexity and unreliable nature of the real estate and stock markets and are looking for new investment opportunities that have less risk and are easier to understand, domain name investing might be a good fit for you. Connect with me, follow my posts, and I’ll go into more detail on how you can generate a cash flow and a positive return from your domain name investments.