Porfolio Sales

[golddiggerguy]

I seen a few people over the years selling up and passing on (or trying to) "Full portfolios"

I'm just wondering who has done this or do you know of anyone who has done this with any success?

I'm looking at reducing my list of domains to a selected list of local domains I wish to keep. Does anyone buy full portfolios or big bulks and at what spec?

 

[brum]

would buy if the price is right

would buy if the price is right ...

 

[neilrbowen]

Id be interested depending on price and domains too

 

[Brassneck]

I seen a few people over the years selling up and passing on (or trying to) "Full portfolios"

I'm just wondering who has done this or do you know of anyone who has done this with any success?

I'm looking at reducing my list of domains to a selected list of local domains I wish to keep. Does anyone buy full portfolios or big bulks and at what spec?

I'd be interested too in knowing whether anybody has done any large scale deals. In particular, what would be the 'right' price.

For instance, domains with potential £500 end user sales - would they be valued at much more than reg-free (or less) in a portfolio purchase?

Stephen.

 

[golddiggerguy]

Had lots of PM,email and IM interest so we'll see once I send lists out

 

[Brassneck]

Had lots of PM,email and IM interest so we'll see once I send lists out

Best of luck.

Stephen.

 

[khalid]

I've just agreed a sale with a large company. I managed to secure this because I've done business with the Chief Exec before, selling him a generic name.

If you let me know the portfolio I can ask if they'd be interested.

Khalid.

 

[golddiggerguy]

Thanks for the interest lists now sent out, just need sales or a BIG sale

 

[Edwin]

It's very hard to see how the math on a big sale makes it worth exiting the industry, unless the buyer's willing to pay a decent fraction of potential end-user value. Sure, I'd sell out if "the price is right" - I think just about anyone would - but it's not worth dumping diamonds for the price of coal. After all, across a large portfolio you only need a handful of decent names a year to cover renewal costs, and beyond that there's no maintenance required so it's a zero-effort investment. You'll never be able to replace what you just sold for anything like you sold it for, after all!

I'd also be curious to have some kind of indication as to what people see is an "achievable" valuation vs theoretical value, if such a thing can even be quantified. For example, are people settling for 25% of list? 10% of list? More? Less?

 

[Pred]

I'd be interested too in knowing whether anybody has done any large scale deals. In particular, what would be the 'right' price.

Yun Ye Did What Frank Schilling Should Have Done

 

[Pred]

It's very hard to see how the math on a big sale makes it worth exiting the industry, unless the buyer's willing to pay a decent fraction of potential end-user value. Sure, I'd sell out if "the price is right" - I think just about anyone would - but it's not worth dumping diamonds for the price of coal. After all, across a large portfolio you only need a handful of decent names a year to cover renewal costs, and beyond that there's no maintenance required so it's a zero-effort investment. You'll never be able to replace what you just sold for anything like you sold it for, after all!

I'd also be curious to have some kind of indication as to what people see is an "achievable" valuation vs theoretical value, if such a thing can even be quantified. For example, are people settling for 25% of list? 10% of list? More? Less?

i agree Edwin
i think what anyone who is offering would have to do is put a price beside each domain in list they were offering on basis of buying lot. then tally up
and supply list with prices and final figure
as someone offering may thin k 50k is a lot for example, but on a portfolio of 'only' 1000 domains, thats only 50 nicker each
surely you could email everyone and ebay the lot for far more,indicidually, or in lts. sure time consuming, but its profits.
and obviously there are dozens, if not hundreds of pearls that can get x,xxx, xx,xxx each on their day
plus you would have to factor in age, how much was spent on acquisition, and how much 'time left on clock'

interesting discussion, as i have about 900 .uk domains and i am mainly in the .com space tbh, and develop mainly in that area
have considered selling uk portfolio but are there buyers who want to spend xxx,xxx ?
or will it be the usual tyre kickers wanting to pay 20 quid a domain and asking what traffics like ?

 

[Brassneck]

It's very hard to see how the math on a big sale makes it worth exiting the industry, unless the buyer's willing to pay a decent fraction of potential end-user value. Sure, I'd sell out if "the price is right" - I think just about anyone would - but it's not worth dumping diamonds for the price of coal. After all, across a large portfolio you only need a handful of decent names a year to cover renewal costs, and beyond that there's no maintenance required so it's a zero-effort investment. You'll never be able to replace what you just sold for anything like you sold it for, after all!

I'd also be curious to have some kind of indication as to what people see is an "achievable" valuation vs theoretical value, if such a thing can even be quantified. For example, are people settling for 25% of list? 10% of list? More? Less?

Problem is that those of us who do this individually are going to have to sell up in some form one day. I imagine many domain portfolio holders are beginning to reach middle age so a lot will be looking to cash in at some point in next 5 to 10 years. I am worried that what looks on paper like a decent portfolio capable of getting £1,000 per domain to an end-user might look like £10 per domain to somebody willing to buy up the whole lot.

Stephen.

 

[Edwin]

Problem is that those of us who do this individually are going to have to sell up in some form one day. I imagine many domain portfolio holders are beginning to reach middle age so a lot will be looking to cash in at some point in next 5 to 10 years. I am worried that what looks on paper like a decent portfolio capable of getting £1,000 per domain to an end-user might look like £10 per domain to somebody willing to buy up the whole lot.

But why would you sell out, unless you're getting a decent per-name price or the market for domains vanished? Selling names isn't a high-intensity job, so even as you get older you could probably squeeze in a few hours a month of sending out invoices and banking cash.

Think of it a different way: if across your portfolio (this is an illustration) you're averaging 10,000 pounds in after renewal fee profits via passive sales each year, and you're working a few hours a month to do so. To replace that "income" in some other way, you could buy an annuity that gives you income each month. But a quick play with some online annuity sites tells me that you'd need to plonk down about 200,000 pounds up front at age 60 in order to be pretty confident of receiving 10,000 pounds in income each year. And in turn, to get that 200,000 pound lump sum to invest, you'd have to sell a >> 200,000 pound portfolio because capital gains tax will really bite you on such a large one-time deal!

On the other hand, the net present value of the money is also important. If you've got a hefty mortgage but a sell-out scenario would see you go debt free, that could be almost as much of a safety net for the future as the existing income stream would be.

At the end of the day, remember that revenue streams are the hardest thing to replace, especially in a low-growth, low interest environment. So an investment that is throwing cash out like clockwork each year is very valuable in that respect.

 

[Bailey]

I agee with Edwin, generally those that are making a good or even reasonable return on their time and investments aren't looking to sell-up anytime soon. I guess it's also a case of projecting ahead - does it look bright?

I have been somewhat surprised since becoming active on Acorn the variable quality of domains held. I have learnt from my personal experience there seems to be quite a gulf between makes a great 'development' and what appeals to and 'end-user' .(I'm not refering to sales of high quality domains strickly sold for development but the mainstream market).

And of course the other big decision point must be based on whether your making at least one £x,xxx sale a amonth or your relying on a couple of hundred sales at £xx to achieve the same end each month, It seems to me that most that are looking for a way out are those that are working to the second model and will struggle to sell their portfolios.

The idea that anybody really can say what the value of their portfolio is at anyone time is also spurious one - whatever you think it is divide by 50 because anybody that smells a domainer looking for a way out will be.

i do know one domainer that sold out for around a million but, that was in 2005/6 when there was a fair amount of big spenders still building portfolios

 

[brum]

portfolio value

the way i look at is this :-

if i had 1000 domains advertising to end users for £2K each that makes my domains worth

1000*2K = £2 million... nice lets assume after neg u get half

still
1000*1K = 1 million value if sold to end user.

however if i am only selling 30 domains a year
that means an income of 30K- costs 1000*£3=3K= 27K cashflow or profit

and to get my full £1 million would take me 1000/30 each year =33 years
(ignoring the fact you have less domains to sell each year so would probabaly sell less)

in reality most business are sold based on either:-


1 asset value
2 P/E ratio basically multiple of the profit each year.

1) on asset value we could say portfolio valued at £1 million

2) on p/e multiple 27k * (between 2-6 i guess)

which means this portfolio maybe worth between
27*2= 54K
and
27*6= 162K

a big difference to the asset based valuation !!!!

but lets not forget the best domains are probably the ones that are being sold from the portfolio and the rubbish is what is being left behind.

whats ur thoughts guys

 

[Bailey]

but lets not forget the best domains are probably the ones that are being sold from the portfolio and the rubbish is what is being left behind.

whats ur thoughts guys

I'm just going to pick-up on that point for a minute - because I disagree.

Most enduser sales are matching their requirement to your price . i would say that as much comes down to business acumen (and I use that term to cover a multitued of sins/talents)

It never ceases to amaze me how many build their portfolios on what they believe will sell - Instead of looking at it from the buyers perspective of what they want to use and more importantly happy to be associated with .

 

[golddiggerguy]

My reason for the sale is to free up locked domain cash and then use the money to push a project more than I am at the moment and a big cash sum would help.

At the moment CASH for me IS KING! (Or would be) and so it's not an investment I can just sit on for the next 5 -10 years selling the odd 1 or 2 a month.

 

[namealot]

I know of a few that gave sold .com portfolios Two had good strong generics etc both in the same field’s one none less than 10k per name he had no problem achieving a good sale acoss the board the other 40% above 10k per name the rest a ranging down to a to low 100s he said that they were offering very little for the lower priced ones he eventually broke the portfolio down selling the lower priced ones first then the above to one buyer.

It would seam easier to achieve good price across the board if they are all above a certain value than only some are…? I suppose you should always save the best to last ....on not so good ones

 

[Edwin]

however if i am only selling 30 domains a year
that means an income of 30K- costs 1000*£3=3K= 27K cashflow or profit

and to get my full £1 million would take me 1000/30 each year =33 years
(ignoring the fact you have less domains to sell each year so would probabaly sell less)

I guess you could turn around and ask yourself "How many more sales could I get if I reinvested 50% of that 27K in marketing my domains?"

There aren't many people (myself included) who are really spending SERIOUS marketing on the post-acquisition marketing of their portfolios. However, it does occur to me that if you're selling in say the 1,500-3,000 pound range on average and have a decent sales stream, then it would still leave you a hefty profit if you could source unsolicited sales at say 500 pounds each (e.g. prepare and distribute a custom snail mail and follow-up campaign to 20 targeted businesses for 1 domain, at circa 50 pounds per business mailing/follow up)

After all, if you can sell 30 names a year with zero effort or 100 names a year and 70 come with the effort of overseeing a bit of marketing and writing a few cheques, and a bit less profit-per-name, I know which result I'd prefer!

(Incidentally, I plan to adventure gradually down this route in the coming months and years)

 

[Sound]

I think its very easy for people to believe that they own large portfolios of profitable generic domains when in fact they don't.

Do a Google search for "domains for sale" and you will find an endless stream of peoples portfolios listed that are mostly reg fee.

Many people have sold the few generic names that they caught to fellow domainers and are now left with large lists of average names is this really a portfolio that investors are willing to purchase?

I think if you are sitting on a large list of domains and haven't had monthly enquires about your portfolio you are just kidding yourself.