Or are you the type of domainer who gets all sweaty if the domain doesn’t receive any offers after the first couple of months? I want to make one thing perfectly clear: if you’re not willing to buy and hold, do yourself a favor and give up.
A lot of people make the mistake of not understanding the difference between an investor and a flipper, the same way others make the mistake of not understanding the difference between an investor and a day trader.
Look Beyond the Hype
Sure, flipping sounds all exciting and everything (the same way day trading sounds more exciting than investing) but in most cases, it’s a boulevard of broken dreams just waiting to happen. We humans are always tempted to look for quick fixes, quick cash and so on. That’s a huge weakness, stop living in denial!
In most cases, flippers are not capable of thinking rationally and that’s mainly because they’re always under pressure. There are obviously exceptions but for the most part, having “gotta generate cash asap” as your domaining business model will get you in trouble at one point or another and before you know it, you’ll go from being rich on paper to desperately wanting to:
Break Even
Doing something as risky as flipping without huge margins is not exactly all that smart. You win some, you lose some and without impressive margins, you’ll find yourself at that marvelous break even point after drawing the line.
If you’re currently a flipper and all of this sounds painfully familiar, don’t worry! There’s no time like the present to put everything under the microscope and make some important decisions. Do you want to continue living in uncertainty? Dreams don’t put food on the table, this much is certain.
As far as I’m concerned, “buy and hold” is an approach which works far better. Holding a dot com, a dot net or a dot org for 10 years (!!!) costs less than 100 bucks! This is a huge advantage and unless you’ve been buying crappy domains by the thousands, you can definitely afford to be an investor without having to worry about reg fees all that much.
Ok but a Man’s Gotta Eat, Right?
Yep, you’ll never be in a great position to negotiate if you’re dealing with cash flow issues. Unless you have a LOT of money in the bank, it’s hard to believe that you’ll be able to pull this “I invest for a living” thing off 
Monetize your type-in traffic effectively, develop a handful of sites, don’t put all of your eggs in one basket! As far as most people are concerned, investing is one thing and putting food on the table is another. Smart investments will pay off in the long run but in the meantime, get busy and make some money!
November 3rd, 2009 at 8:23 am
I try to trim my portfolio to 50-100 domains tops. That way, I always know that I can afford to hold them all.
November 3rd, 2009 at 9:21 am
It’s hard not to get impatient, which is why I think most people become domainflippers even if they think that they’re investors. One compromise leads to another……….
November 3rd, 2009 at 10:05 am
One sometimes has to be patient but if you are holding hundreds of brandable but non-premium domains they need to be priced at a point where at least a potential end user isn’t going to have sticker shock. $1000-$1500 for a .COM domain or one-word .net may be no big deal for many companies but if you ask for $5000 for a so-so name you’ll be waiting a while. The higher you price a domain, the easier it is for a buyer to find alternatives.
On the other hand somtimes you need to stand your ground. Recently I received an offer via email for a domain with a high $XXX price at SEDO. They started about 40% below my SEDO price, but I felt it was a fair price, did some research on the buyer and discovered it was a web development firm with numerous web portals and who also held the .Net equivalent. After a couple of weeks they accepted my fixed price offer.
November 3rd, 2009 at 10:47 am
From my experience, even if you price a domain fairly it will still take time until you receive an offer. I agree with Leonard that if your price is shockingly high nobody will bother to even contact you with an offer but even if you price your domains very reasonably you have to still have patience to hold and not run off on some forums and sell them at a loss or at a very small profit.
November 8th, 2009 at 9:31 pm
A lot of people get nervous holding and as an end result don’t make as much profit. It takes years of experience to be comfortable holding domains.
July 28th, 2011 at 11:33 pm
Along with every little thing that seems to be developing throughout this subject material, your points of view are actually somewhat stimulating. However, I am sorry, because I can not give credence to your whole theory, all be it exciting none the less. It looks to everyone that your comments are generally not totally justified and in simple fact you are generally yourself not even entirely convinced of the point. In any event I did appreciate examining it.