I asked Adam Dicker, CEO of DNForum.com and DNFCollege.com, about the best way to value a domain name. Here’s what he said in the interview.
Happy holidays to all DomainSherpa readers. May 2012 be a prosperous domaining year!
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About Adam Dicker
Adam Dicker is the CEO of DNForum.com, the largest online domain name discussion forum. He is also the founder and CEO of Domain Consulting Group, where he manages his portfolio of domain names and develops online businesses.
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Sponsors of This Interview
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Adam Dicker Interview Raw (Non-Edited) Transcript
Adam Dicker Interview Transcript in PDF Format (Right-click to Save As…) [View in Google Docs]
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Here’s your program.
Michael Cyger: Alright Adam for those that don’t have the 15 plus years – 20 plus years – I’m not sure exactly how many years of internet experience that you have what is a good bench mark for them to determine the value of a domain name? What is a good tactic for them to use? Should they go to an online evaluation tool? Should they pay for online valuation or online appraisals? Should they send you an email? What is the best way for them to determine the value of a domain that they own?
Adam Dicker: To be honest with you at the beginning, and I did this myself, I was lucky enough to find somebody that I could trust that I would run by things that I was thinking of purchasing or things that I was thinking of selling and say am I getting a good deal? And that is the best benchmark you can get. Find somebody you can trust, whether it be me or somebody else and use them as a benchmark. My advice on appraisal tools and all the guys that write them won’t like this but it is don’t ever pay for an appraisal. And why is because they are useless. Remember what I said earlier the buyer dictates the price. You little piece of paper saying it is worth trillions of dollars won’t get you any more revenue for your domain.
Appraisals are just a way for you to get an ego boost and a waste of money at the same time. There are also known scams of people asking you to get appraisals before they buy your domain name. Then you get the appraisal from the lowest company that they send you and that is where it ends. They never buy the domain name so please don’t fall for that either.
Michael: But what if you go to one of the more reputable services like SEDO.com is the largest marketplace in the world. They offer an appraisal for I don’t even know what it is. Let’s say it’s $30 or $40. I’m not sure, on that order of magnitude I’m sure. If you got an appraisal for $10,000 doesn’t that give you more ammunition when somebody comes to you and offers $5,000 or $1,000 for it? You could say hey SEDO the largest marketplace in the world said it was worth $10,000?
Adam: Not really because if the buyer is not going to give you any more money for it, it is completely useless. Plus in most cases the people doing these appraisals are running algorithms. They put in your domain name and out comes a price. So you are not really getting any value. They don’t know how many competitors there are for that domain name for that keyword. Like if you are selling insulation. You have 10 companies that are famous for selling insulation so Insulation.com may have more value and it may come out on an appraisal. But at the end of the day an appraisal is like a jewelry appraisal. A jewelry appraisal is only good if it is stolen and you want to replace it. You domain name hopefully won’t get stolen. And a domain appraisal has no value what so ever.
Michael: What about DNForum.com? Your discussion forum. Do you have a special area of your board that is just dedicated to getting appraisal input from other domain investors and those on your discussion forum?
Adam: Yes DN Forum serves as a gut check to keep you realistic on your prices. But I always tell people buy from domainers but don’t sell to domainers. And remember if somebody asks you to do it for a price or they send you an email about a domain name and ask for stats on a domain name don’t sell it because they are a domainer. Only domainers ask for stats on domain names. And you want to sell to end users. You don’t want to sell to domainers.
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