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A website wants to buy my domain name.How to valuate and negotiate?
kwadguy



 
Msg#: 4391721 posted 6:12 pm on Nov 28, 2011 (gmt 0)

Here's the deal:

I own a domain name (.com), and have owned it for > 10 years. I haven't done anything with the domain.

Recently, a startup (founded in 2010; about $90M raised in two rounds of financing, the latest (~$30M) a couple of months ago) trademarked that name and is up and running. It's a retailer, and obviously they'd like the name. I haven't engaged them yet in discussions, although they have tried (repeatedly) to contact me. Right now, they are using a variation on the name as their domain. But the name of their site and business is the domain name I hold.

The questions:

1) Can they force me to give up the domain in the US? I owned the domain name long (about a decade) before they trademarked their name. I don't plan on using it for anything related to their business model. (My understanding from reading here and elsewhere is no, they can't take it as long as I don't try to subsequently change my domain to try and infringe/mislead).

2) Is there an independent appraiser who can provide me with a somewhat reliable valuation for the name? They are very keen to get the name, obviously. And without any feedback on my part, they've make 5 figure offers for the name. Since this is a specific case, with a particular business interested in the name, the more generic appraisal services don't make much sense.

3) Is there a professional middleman I can/should engage for negotiation? That is, hand off the negotiations to someone with lots of experience in such things? Someone who'd know the lay of the land, what the name is really worth, and who can play hardball?

Again, it's the name of a new business with about $90M in total funding, Web based, who are consumer oriented and up and running (and headquartered in the US).

Thanks.

 

wheel

WebmasterWorld Senior Member wheel us a WebmasterWorld Top Contributor of All Time 10+ Year Member



 
Msg#: 4391721 posted 6:25 pm on Nov 28, 2011 (gmt 0)

I don't think they can force you to give up the domain. By the same token, you should probably be careful going forward on how you monetize it. Because while you're getting big eyes over how much money these people have, they have the same amount of money if you p*** them off.

I think you're making a bigger deal of how much money they have. That doesn't mean that they'll make a stupid decision or that you can gouge. More likely if you get greedy you'll simply sour the relationship, then how much are you going to get?

I would negotiate myself personally. Middlemen don't come cheap.

This is me - I'd look at that, say I'm not using the domain and make them a reasonable offer. If they offered me 5 figures, I'd probably shake hands and think, heck, everybody got a good deal. But I take the attitude that if it's a good deal for both of us, that's good enough; I don't need to squeeze every penny out of them - I'm OK if they get a good deal too.

If you want to squeeze, there's a simple rule of thumb I read in a book written by a successful entrepreneur. Simply counter offer with twice their price. They offered $15k? Go back at $30. Then have fun and don't screw it up. The worst they can do is say no - and that's on them.

In terms of valuation, getting one would be worthless. You're not concerned about market price, you're concerned about how much this specific company will pay - and a valuation won't tell you that. Actually, I'll give you a valuation. Take the company out of the picture for a second. You've sat on this domain for 10 years and have done nothing with it right? So what's it really worth? Clearly, not a whole heck of a lot. Certainly not 5 figures, probably not even 3 figures.

bwnbwn

WebmasterWorld Senior Member bwnbwn us a WebmasterWorld Top Contributor of All Time 5+ Year Member



 
Msg#: 4391721 posted 6:35 pm on Nov 28, 2011 (gmt 0)

what the name is really worth
Worth nothing if the buyer doesn't want it but could be worth a million if the buyer is will to pay it. Buying selling is worth what the buyer is willing to sell and what the seller is will to pay.

I would start out the converstation with a high estimate. They can come back with their offer. Then you guys can meet in the middle your happy they are happy. Wheel makes a good point be careful if you launch a site.

To me it sounds like a good time to make some christmas money and move on.

kwadguy



 
Msg#: 4391721 posted 6:59 pm on Nov 28, 2011 (gmt 0)

I'm not sure whether it's relevant, but the domain name I have (which has a standard generic set of redirect links provided by the hoster) is getting about 25,000 unique hits a month because of the overlap with the successful website (they're getting about 3M hits; tripled over the past 6 months; 200,000+ likes on Facebook; all that stuff that consumer oriented websites like).

I am not looking to be unrealistic. I just don't want to leave foolish amounts of money on the table.

wheel

WebmasterWorld Senior Member wheel us a WebmasterWorld Top Contributor of All Time 10+ Year Member



 
Msg#: 4391721 posted 7:21 pm on Nov 28, 2011 (gmt 0)

Well, I'd suggest this.

"Thanks for your offer, I appreciate it. I am interested in discussing a sale. However the site is currently receiving about 25,000 visits a month and in light of that I believe an amount of (2X their offer) would be more appropriate.

If that's acceptable, feel welcome to contact me by email or by phone, we can get the process started today."

That last thing I did there is a little extra something sweet :). Give them some enticement to get it off their plate. Like the deals already done, just got to get that little payment thing out of the way.

Then see what they say (and keep us posted - I love reading success stories).

HuskyPup



 
Msg#: 4391721 posted 7:27 pm on Nov 28, 2011 (gmt 0)

I simply find it amazing that they never approached you before they started this venture, how incredibly na´ve/dumb!

creeking

5+ Year Member



 
Msg#: 4391721 posted 7:30 pm on Nov 28, 2011 (gmt 0)

they are interested and motivated. I would let them make the offer.

Leosghost

WebmasterWorld Senior Member leosghost us a WebmasterWorld Top Contributor of All Time 10+ Year Member



 
Msg#: 4391721 posted 7:44 pm on Nov 28, 2011 (gmt 0)

I simply find it amazing that they never approached you before they started this venture, how incredibly na´ve/dumb!


Vivendi didn't think to check that the name they chose for one of their ventures was available either ( they had bought the dot fr..but someone else already had a similar service operating out of a cyber-cafe , meant they were in a "trademark problem"
[transfert.net...]
story in French ..well known amongst French domainers :)

Outline of the story and some others re "branding" and domian names, in English here, [cyberwise.no...]

Vivendi paid nearly 4 million dollars to the owner of the original "name" and "trademark" so that he wouldn't sue..if he had ,he would have won, and probably made more than 4 million, plus Vivendi had a "deadline" for launch..

minnapple

WebmasterWorld Senior Member 10+ Year Member



 
Msg#: 4391721 posted 4:31 am on Nov 29, 2011 (gmt 0)

I would get a professional sales person to negotiate the sale. Let them know what the minimum you want to clear, and offer that sales person 30% of the final sale.
It will be in their best interest to get the most from the deal.

wheel

WebmasterWorld Senior Member wheel us a WebmasterWorld Top Contributor of All Time 10+ Year Member



 
Msg#: 4391721 posted 11:33 am on Nov 29, 2011 (gmt 0)

I would get a professional sales person to negotiate the sale.

There's no magical professional sales person, and there's precious few techniques even if you found one of those unicorns. And I'm speaking as a professional (and successful) salesperson.

Sales is little more than hard work and a willingness to contact people. And in this case the negotiation and contact are already started. Why pay 30% when all that's left is an email or two?

Heck, if that's the case then PM me, I'll do it for 30%. I've negotiated 6 figure site sales before using my insider secret sales techniques that I can't tell anyone about publicly (OK, I'll spill. It involved calling a company that might be interested and saying 'we're thinking of selling, are you interested?).

Leosghost

WebmasterWorld Senior Member leosghost us a WebmasterWorld Top Contributor of All Time 10+ Year Member



 
Msg#: 4391721 posted 11:44 am on Nov 29, 2011 (gmt 0)

^
Sales is little more than hard work and a willingness to contact people. And in this case the negotiation and contact are already started. Why pay 30% when all that's left is an email or two?


Very true:)

30% is a lot of money for a phone call or two and an email..and is well over the going rate for negotiating domain name sales..especially when the buyer is already hungry..

Webwork

WebmasterWorld Administrator webwork us a WebmasterWorld Top Contributor of All Time 10+ Year Member



 
Msg#: 4391721 posted 2:08 pm on Nov 29, 2011 (gmt 0)

Recently, a startup (founded in 2010; about $90M raised in two rounds of financing, the latest (~$30M) a couple of months ago) trademarked that name and is up and running. It's a retailer,


Publish enough identifying information in any domain name forum and a lawyer worth their retainer will find it and use whatever you say against you in a court of law . . .

Food for thought.

I'd suggest two actions. First, find a professional broker. Second, talk to a lawyer who routinely handles WIPO/NAF arbitrations for advice about how to proceed. (Maybe the second suggestion should be your first action. :-/ )

rocker

5+ Year Member



 
Msg#: 4391721 posted 2:19 am on Nov 30, 2011 (gmt 0)

Webwork is right. Quit posting this kind of info online. Also, consider now that someone has a trademark on the name there will not be as many buyers who would want it.

You are safe since your registration preceeds their mark. However, that may not be true for who buys it from you.

Yes, that is my opinion and may not be accurate. I personally would not buy a domain name that someone else already has a trademark on.

HarleyGuy

10+ Year Member



 
Msg#: 4391721 posted 5:00 am on Dec 21, 2011 (gmt 0)

sedo will help appraise and negotiate this deal for you.

Call them

Swaraj



 
Msg#: 4391721 posted 9:21 am on Dec 21, 2011 (gmt 0)

I am not understanding that why are you so afraid of them as you asked 'Can they force me to give up the domain in the US?'. As you are the owner of that domain then it was their duty to to checkout for domain availability before creating their brand name.

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