Diamonds and Domains, You Need to Know One to Understand the Other. Size Does Matter!

Morning Folks!!

I don't like to hurt people's feelings but I must say I am seeing things that just sadden me.

To understand INVESTMENT QUALITY DOMAINS you need to draw a parallel with diamonds.

A 1 ct. Diamond today of average quality is $5000

A 1 ct. Diamond that is 'D' and 'Flawless' can easily run $40,000 and higher

So a pretty big spread and you ain't seen nothin yet. Please follow as I go to the next parallel.

Now we are looking fr a 10 ct. 'D' and 'Flawless'. Is it 10x the price of the 1 ct. of the same quality? Making it $400,000? No it is not. Is it $800,000? Nope. Is it $1.5MM? Well now we are in the ballpark. So we could be talking not 10X the price but 40X the price. The value.

Now we can work the other way too. Like the majority of domainers. 1/2 carat, 1/4 carat, 1/10 carat. But that is small ball and that is even if you are dealing in diamonds to begin with. Odds are you have quartz. Or worse yet, old broken coke bottles.

Maybe just another Gem. That can be but the chances keeping getting further away.

You can make money focusing on any sized diamond. But the rewards just might not add up and the amount of work will. For every 100 domains you own with no value, you will be paying $800/year or more and increasing. Over 10 years that is $8000. So if you have 1000 domains that is $80,000 over 10 years and if you have 10,000 domains you have a bill of $800,000 over 10 years.

Dump the garbage and go after the diamonds. Size does matter. People need funds and they are looking for creative ways to make that happen. There are bargains out there. Those that get rewarded in 5 years are the ones taking a risk today. Is there any real risk in buying a category defining name? The game is not to invest in liabilities but to invest in appreciating assets. Sorry, but out of the thousands, only hundreds are getting it and it is rare to see anyone come in the industry and at least pick meaningful domain names.

8000 crappy domains is a pile of crap at the end with a big bill attached. I have crappy names and this year I have combed through my list and deleted the first round. Next year I will do it again. More information means new decisions and new areas to allocate funds.

1/10 carat diamonds are not meaningful. But ones as small as 1 Carat can be. Smaller than 1/10? Maybe dust in the wind. Your time, your effort, your money.

Have a GREAT Day!

Rick Schwartz