Well, kind of… but not really 🙂

Technically, sure, anyone can hand register a domain using a $0.99 GoDaddy coupon with the intention of selling it for more. Or spend $100 on 12 dropped domains and bam… you now have a mini-portfolio.

There’s just a problem: 2009 called, it wants its strategy back!

In other words, the game has changed and an approach that worked 8-9-10 years ago might be sub-optimal today.

For example, the idea of owning lots of mediocre domains. At one point, it was possible to do reasonably well with this business model but:

1. While new gTLDs have been an epic fail for investors, they have without a doubt diluted the value of average and mediocre domains quite a bit. In other words, if you own let’s say a mediocre .com domain, you don’t have as much leverage as you might have had in the past during a negotiation with an end user because that person has more options. Either hand regging another dot com or, nowadays, perhaps settling for a new gTLD domain. If you own a SOLID .com domain, that’s another story but for average and mediocre inventory, things aren’t looking great!
2. Sure, you can build a portfolio of let’s say 1,000 domains and play that game but today, there are more genuinely big players out there who are far better-positioned. Mike Mann, HugeDomains and so on. They have tons of data, gathered across hundreds of thousands of domains and are therefore in a far better position than you to make this business model work
3. Believe it or not, there was a relatively healthy reseller market for average and mediocre .com domains back in let’s say 2010. In other words, if you had a portfolio of 1,000 such domains and needed some cash so as to deal with an emergency, there was reasonable demand for your domains on the reseller market. Today? There’s practically no demand for them. I know everyone wants juicy end user sales but the absence of reseller market liquidity for such domains is a major, major problem

… I’m sure you get the point!

Can you build a portfolio which consists of a bunch of cheap or hand reg domains? Sure.

Should you? Nope.

Therein lies the key to this whole “barrier to entry” debate. In my opinion, the game has changed quite a bit over the years. Nowadays, you’re better off investing in higher quality inventory and unfortunately, this means the barrier of entry has gone up.

In let’s say 2010, quite a few people started domaining with next to nothing, bought some dropped domains and flipped their way up. While it might still be possible to do this today, it’s harder and a case could me made that for most people, it’s just not worth their time anymore.

More likely than not, you’re better off getting a job or a second job, working as a freelancer for a while, liquidating other assets or doing something else to generate some decent initial capital. Like it or not, the “low barrier to entry” era has for the most part ended.