I am going to say no.
At least it’s not what it used to be.
Domain investing or domain flipping is a high-variance business where sharks dominate the scene.
I used to invest in domains but liquidated the majority of my portfolio in 2024, and kept “only” a few thousand domains.
I do plan to reduce that number to even a couple hundred.
I am still active in some private groups and forums where domains are bought and sold by the minute but it takes so much time and energy that you have a better chance of building a more sustainable business.
For newbies, this is one of the worst side hustles you can start, and here is why:
Dilution
.COM remains king. Many have tried to dethrone to .com but that will not happen in my life, or ever.
When I started in domain flipping, domain registrars were not flooded by those weird new extensions like .estate or .mom or whatever the hell they came up with.
It used to be a lot easier when you were holding a solid .com domain portfolio, sell it for a multiple and repeat.
Nowadays,so many startups or businesses care less about owning the .com and settle for inferior extensions because:
- it’s cheaper
- available at reg price
- they would not consider owning the one extension that displays trust, or is baked into people’s brain.
You would be surprised how many type in a word in their search bar and add .com as a standard. Type-in traffic has always been underrated.
Sales Process & Relationships
I spent days, weeks, and years in outbound sales. Domain investing is not just buying a domain and throwing it on marketplaces like Dan.
You need to nurture leads and build bridges with big domain brokers and agents that are trying to sell the domain for you.
That requires patience and a lot of networking. It’s mentally draining from time to time.
Looking back when I started a consulting business, it was easier to network and build relationships than this industry.
You Need A Big Bankroll
My experience is that I held on average any domain anywhere between 2-10 years. That means renewal fees will hit you every year and you gotta eat those fees until you get a sale.
The problem is that some of those domains are trend based and what might have been hot a couple years back is worthless today.
I cannot count how many times I cut my losses on domains that were great but lost their value after a peak period.
I have a rule, if I were to buy a domain today for $10, I would need at least 5X that amount for that domain in a bank account to cover 5 years of runway.
Scarcity Factor
Ask any great domain flipper or seasoned player. They will favor .com over anything else. The 3-6 letter domains.
But even if we exclude those white whales, there are great EMDs (Exact Match Domains) that go over the counter for $1K or more each, but held by the bigger domain investors.
The idea of putting in that much money into a digital asset as a new domain investor scares people off.
I feel that the great domains have become so expensive that it’s unjustifiable to take significant risks on a premium domain that might or might not sell.
Speculation
If I had to pick between investing $100 in an index fund or $100 in domains, I would pick the index fund any day.
Both are very speculative fields but index funds at least would give you about 8% return per year on average.
There are hundreds of different side hustles where you can control your fate (more or less) with less speculation and at least stay in control.
It’s not because YOU think the domain is great that the market will agree on that. If there is no demand for it then you’re holding the bag.
In fact, they think a domain is worth 100X because of those fake appraisal tools and are convinced it’s going to pay big. If it was that great, the name would have been scooped up already by a seasoned investor or brand.
Most domain investors do not conduct enough proper research or have the ability to spot trends. And even if you do, someone else has a better system or toolset to beat you to it.
Final Note
There are better ways to spend your money or your time, in a less speculative field with a higher guarantee of net returns.
But if you still want to pursue domain flipping, consider the following:
- Have patience. Domain investing is a long-term game and be ready to hold your assets for multiple years.
- Always put quality first. Domain investing can be a numbers game but you should favor quality over quantity. You rather invest in a specific niche with fewer domains than hold cheap, lesser-wanted domains
- Research. Research and research. You need to educate yourself day in and day out. Read blogs, join forums like NamePros, and possibly find a mentor who wants to guide you.
- Use the domains and build on them. For example, create small niche websites to generate additional income.
- Learn how to sell. Outbound sales and cold outreach are a BIG part of being a successful domain investor. Build a CRM system in Notion or Excel that works for you. You will achieve better results with outbound calls and emails, and possibly a chance to connect with brokers or agents.
Domain investing can still work, but it’s a lucrative business. Be willing to put in a lot of work and focus on long-term goals rather than quick wins.