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How To Tell If Your Interested Buyer Is A Strawman For A Bigger Player?

If you're the master of your domain or website does the buyer's identity even matter?

2:38 pm on Jan 22, 2010 (gmt 0)

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From time to time I receive inquiries about a domain or offers to purchase from what I'll call "strawmen purchasers", someone playing a role - say the poor student or the newly launched business - while that person is actually acting on behalf of a larger, well-funded entity.

Now, some people will argue that it's important to always know the true identity of the inquirer before doing business. Their rationale for this is often economic, i.e., deeper pockets should lead you to ask for or expect more $$$$.

I'm of the school of thought that who the purchaser is is only relevant to the issue of certainty (not guarantee) of payment. The value of a domain - what you might/will accept in exchange for the domain - is a thing independent of the buyer's status. In other words, I'm no more willing to discount a domain (with rare exception) because the buyer lacks means than I am prepared/willing to jack up my expectations/demands because the buyer is well-funded.

So, there's 2 issues at play here.

1. Should you always insist on knowing the true identity of your interested party AND HOW do you ever know . . for sure.


2. Is the value of a domain a function of the buyer's ability to pay or does that type of thinking just screw up potential deals?

How do I know the "true identity" of any buyer? I'll ask, when I care to know. I'll ask for a business address and land line, for starters. I'll go so far as to ask if they are acting on behalf of another entity in some cases, where I'm just not in the mood for BS. ;)

And, honestly, I feel it's a bit like admitting like I don't know my own business to think that pricing is a function of anything other than the intrinsic qualities of a domain, which is exactly why, in most cases, I picked up the domain in the first place.

So, do you always insist on knowing the identity of your "interested party" BEFORE discussing price, negotiating, etc.

Do you set a price without regard to the purchaser's identity or do you employ some sort of sliding scale? How has that approach worked?

12:53 am on Jan 30, 2010 (gmt 0)

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I've always been one to not care who is trying to buy from me... if they give me what I want I give them what they want.

But now that I see physics points... I think this will change. Thanks for this thread guys... it is the best thread I have seen on WebmasterWorld in the last few months!

7:16 pm on Jan 30, 2010 (gmt 0)

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Was recently in this situation. The buyer I suspected was a straw and I suggested some method to resolve the situation. The broker suggested this would queer the deal, so as I wanted out and the offer was decent, I took the money. Sure enough, later I find it looks like I was right.

Perhaps there is a solution that the brokers should start offering, as they lost out too.

12:01 am on Jan 31, 2010 (gmt 0)

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Recently, I was approached and asked if I would accept an offer to buy my Website (web-business).

So did I .. and I continued with .. "For 1 billion dollars" ..

I used to get garbage offers/inquiries every week there for a while (2004-2006), but as soon as I started demanding outrageous prices, they sort of just .. went away.

1:15 pm on Jan 31, 2010 (gmt 0)

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as soon as I started demanding outrageous prices, they sort of just .. went away

That's fine if what you want is to not sell under any circumstances.

But there are a few serious buyers out there who are willing to pay a fair price.

A better reply may be to quote your price as a multiple of your earnings and stipulate that any disclosure of stats or revenue would be subject to inspecting the buyer's book and verifying his proof of finance (quite normal in the world of business buying).


2:39 pm on Feb 1, 2010 (gmt 0)



The following message was cut out to new thread by webwork. New thread at: domain_names/4071959.htm [webmasterworld.com]
10:17 am on Feb. 1, 2010 (utc -5)
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