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Profitable Flip: Crypto Domain with Logan Flatt

Logan Flatt has been consulting large corporations about online marketing since the beginning of the internet.  As a domain investor, his perspective on domain values is influenced by these day to day interactions with enterprise marketing budgets.

Logan joins us today to share a profitable flip with a crypto domain, CryptoCPA.com. He meticulously charts the domain history even including initial registration, expiration and complete drop back to the registry for over two years before another new registration. He tracks asking price and offers versus crypto value at each time, and of course you get all the details leading up to the final sale too!

Any domain investor or crypto domain investor interested in making profitable flips will benefit from today’s show!

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This Show’s Sherpas

Logan Flatt
Logan Flatt
Logan Flatt is a part-time domain name investor.

Flatt is also senior vice president at Ansira, leading data-driven, technology-enabled marketing solutions provider, specializing in the integration of local and national marketing programs through marketing automation, data analytics, CRM and performance media.

Flatt has dual degrees from Southern Methodist University in operations research and mathematical sciences. He also is a Chartered Financial Analyst.

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On today’s show, we bring in strategic internet marketing consultant Logan Flatt and we discuss a fascinating profitable flip with some really interesting unexpected twists and turns along the way. Plus it’s a crypto domain and we all have a lot of interest in that too. Enjoy the show!

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Hey Sherpa network. Thanks for joining us today. I’m Tess Diaz, executive producer of domain sherpa.com and today we are joined by our old Sherpa friend Logan Flatt. Hi Logan. How you doing? Hi Tess, how are you? I’m great, thanks. Um, it’s been about a year since we got together in Dallas. But I have that picture still and will definitely, I think I’m going to post it as part of this video. Logan has the coolest license plate of any domain rhino. So Logan you have been domain investing since 2009 but you were also a strategic consultant for a marketing agency and I think that’s how you first became aware of demeaning values. Correct? Yeah man. I started doing internet strategy consulting background 96 97 to large corporations that were trying to get online back then and have an eCommerce presence back in that timeframe. And so I’ve always been involved with, with domain names.

I just wasn’t smart enough to invest in them way back then. Well you were smart enough to be an internet consultant in 95 96 that uh, that’s pretty cutting edge and you’ve always been so good at seeing the big picture. So I’m really excited today. You have an interesting and a very well studied, profitable flip to share. So 83% net profit. And you gave me this amazing timeline from the day the domain was registered. Love it. Um, let’s jump in. So this is crypto CP a com. Yeah. You sold recently. In fact, we waited to film this until the sale officially closed. Fun to be part of that process with you. Logan, why don’t you take me through the high end and then we’ll break it down. Sure. Okay.

Yeah. Crypto CPA, a CPA stands for certified public accountant and I’m obviously a, a big demand for accountants who can know how to do accounting for cryptocurrency transactions and things like that. Um, and so it’s a domain name that I’ve found at one point and uh, ended up paying like $144 for it and total, but um, sold it once, didn’t go through, sold it again, went through a, I ended up making about 15,000, $200 gross, um, for the domain name.

Beautiful. Beautiful. Congratulations. So, um, so the domain was first registered in 2013. Um, uh, and you know, it’s a good point. What do they say? Ah, the only things that are certain in life or death and taxes. So yeah, I look at, uh, you know, crypto CPA you get if, if crypto is an emerging market taxes in that emerging market. Brilliant. Right. So, um, so it was registered a year later. You mentioned that it went pending delete and no one bought it again for over a year. And I think that’s a neat part of your research process, Logan, um, that you noticed that part of the history because a domain name. So if you look@cryptocpa.com right now in the who is, you would show that it’s registered originally in June 7th, 2016, but that’s just this current life for the two main, it was also registered in 2013 and someone changed their mind and let it go or forgot about it or something and then no one else thought of it or decided to purchase it for, you know, over two more years. That’s interesting to note that there was a missed opportunity there. Um, in the beginning,

it’s interesting because, um, back in 2013, you know, Bitcoin was only $826 per Bitcoin. Uh, somebody registered it, they did it under privacy, so I couldn’t see who it was, but they let it drop a year later. Um, like you said, it didn’t, it didn’t get picked up for another year. So finally in 2016, June, 2016, a guy in Russia came along and had registered it again, uh, about the time when Bitcoins were like $584 a Bitcoin and, um, he let drop the next year as well. And so went to auction.

Funny. Yeah. But that year it went to auction and got some attention. So even though Bitcoin pricing was lower, probably it, uh, global awareness was growing for it. Um, you would think, right. So, okay. So it goes to auction a year later, July, 2017 it’s one at auction. Um, and it is super cool. I might, I don’t know if it would be easy to post this, but you put together a really neat Excel spreadsheet that shows that each item that happened to the domain, but then also the cost in both cash us dollar and in Bitcoin at that time. And that’s really, really neat. Um, so it went for $120 at auction and it was pretty much immediately listed for more or less 15,000, 14,488 at uni registry,

right? Yes. So as soon as I wanted at the auction, I don’t have $20. Um, you know, I had to pay, you know, go to 80 requires you to pay your renewal fee right there. So it’s like $135. I got into it at that point. Uh, but I immediately thought, cause by this point Bitcoin’s worth $2,300. So it’s gone up, you know, a good bit since it was first registered. Um, so I thought maybe it was around $15,000 that I could put it out there at university market. Um, so I put out there to buy now price and um, and basically waited.

Okay. When you, you noted different changes in Bitcoin pricing, um, then you repriced it in January, 2018, um, with a pretty big price slash 8,400. Was it just the cost of Bitcoin that made you do that or did you have other strategy or thoughts behind that?

That was pretty much because, you know, up until that point, Bitcoin was making its big run up to about $19,000 per Bitcoin. Um, so around December 18, 2017, it really peaked at $19,500. Um, and then it started to basically just collapse. Um, and so, um, by January 15th of 2018, it was already back down to about $14,000. And I started to kind of lose, you know, some, my own belief in Bitcoin and what this thing was. Um, and so I really felt that, um, maybe, maybe this crypto cpa.com really wasn’t worth $15,000. So I ended up, um, putting it out there at university market for about 8,000, $400, as buy it now. Um, and then, um, honestly I had to make offer on the page as well. So, uh, someone finally did come along and a few days later and make an offer.

And does that indicate to you that um, someone was watching it and wondering if that would change or do you think it just happened to be, I mean, I noticed it was at the very beginning of a new calendar here. People are just ridden their taxes. People are thinking about accounting. Do you have any insight on why that buyer came along three days after you repriced it?

Uh, I do think he was watching. He was, uh, uh, the younger accountants at a Delray beach, Florida. And um, he, he, uh, basically, uh, yeah, January he was thinking about taxes cause he was doing taxes for other people and he was, um, you know, wanting to, uh, do his own taxes as well, I’m sure. But also, obviously he had a business as a CPA and was, uh, interested in buying this domain name, but he came along and he, uh, initially offered $6,000 for the domain name. So I thought, Hey, that’s a good offer. But I countered back to him that, Hey, thank you for the offer, but the lowest we could do is like 7,000, $900. And, uh, but he immediately comes back and makes me an offer, which I thought was very interesting. Uh, he said that he offered me that instead of $88,400.

What if he pays me $10,000? Okay. By April 18th, which is three days after April 15th, which is the tax period. Right? Um, uh, but he wanted to pay me $10,000 for it if I would take it off the market. So you’d say he put 20% down, put it in escrow, um, and then, you know, pay the rest later. Uh, and he understood that if he didn’t finish the transaction, he would forfeit his $2,000 up front. Um, so I thought about it, you know, for a while, and I came back the next day and basically said, [inaudible], well, I wouldn’t take 20% down, but I’ll take 30% down and then he could pay basically $100 in February, $100 in March, and then the remaining 6,000, $800 he could pay in April. So after maybe, presumably he was going to get a tax refund or something himself and he thought maybe he’d have it by then and that he could pay that that last bit off. Um, but I made it clear to him that, you know, he’s got to make all the payments and if he doesn’t make them all, then he forfeits whatever payments he had made to that point, um, which is part of the agreement. And that’s also typically part of the escrow.com agreement when you make a payout like that. Um, and that’s, that’s basically what we agreed to was 3000 upfront, 100 bucks, 100 bucks, then 6,000, $800.

That’s, you know, great negotiation. Just asked for a little bit more. Um, also that, you know, steady, uh, interest even more than the income you 100 bucks, but to keep them remembering that this was a payment and um, actively somehow even emotionally invested in, in the domain. And was that your thought behind the a hundred dollars a month?

Yeah, and I wanted him to be more committed than $2,000 up front. I wanted 3000 up front and then I want to make it easy for him on $100 payments. Um, but then if he’s going to get this big lump sum check or whatever after the tax season’s over, then he can make that $6,800 final payment. Sure. Unfortunately I was wrong. He didn’t finish all the payments.

Okay. But you got to keep the initial down payment, so not too bad. So first you folks discussed terms, you came to an agreement verbally. How did you memorialize, was it difficult? Do you have a contract template? A D, D I assume you used escrow.com?

Yeah, I basically a crafted a purchase agreement and I did it right there. And the university market in the platform they have there to, he can, you know, we can all call us, come back to this documented session where we’re were negotiations being documented, but I wrote the agreement there and we agreed to it there. Um, and then when it went to, um, escrow escrow.com had their own agreements. Uh, but I sent that basically that, that, that agreement, he and I agreed to sell it to escrow.com that’s [inaudible] dot com had its own agreement because they want to make sure their rights are included in the agreement amongst all three of us. And, um, but it’s very similar. It wasn’t, it wasn’t too different in the end. And, um, and escrow.com did a great job in setting it all up and helping the buyer, uh, make his first payment. Uh, he put, he made the first a $3,000 payment, plus he paid the, uh, extra escrow.com fees at the same time. It’s about $300 for that, uh, for them to manage the payment process, uh, over the four months.

So Logan, I think this is really interesting to note. Um, you negotiated the terms on one platform, uni registry. So were you even emailing or you were just messaging through uni?

Just messaging through unit registry.

Okay. Then you agreed to terms, then you um, you utilized uni to write those terms up and then you went to escrow and of course escort needs their interests included in all of this. Are there terms, right. So, you know, it’s scary to get someone to agree just one time, but then to get them to agree a second time can often be a, um, a stumbling block or a moment for them to walk away. Um, did you feel like that was a difficult, um, something to overcome or did you feel like with this particular buyer it wasn’t a big deal?

I didn’t think it was a big deal. Um, cause we were, we were already right there negotiating in the email stream at university market. Um, it was just me typing up what looked a little bit more formal and it said the dates of the payments when they were due and the consequences of not finishing the payments.

And you did that in what, like a word doc that you uploaded to uni or

no, I’m just right there, right there in the uni in the uni platform. And we both agreed to those terms and I said, okay, well I’ll send this over to escrow.com and they’ll get it set up. Um, but just astro.com had their own agreement that they wanted us to both sign. But it was the same terms. It was, you know, it was very simple to do. It wasn’t, it wasn’t, I wasn’t worried about the risk of that, um, at all. Cause we were pretty much confirmed in our agreement.

Are you saying it’s like the standard escrow terms that you agreed to or there was something extra?

Uh, escrow had is basically it’s standard terms, but it had my same payment agreement, um, kind of baked into their agreement. Um, so that everyone understood what, what the terms were and why. I screwed up comms responsibility was in that agreement as well.

Okay. And PR, you know, most likely that’s just a statement to escrow’s um, credibility in the market that I think it makes it very easy for people to understand, Oh, there’s just another button to click. And um, to the, just the ease of the process in escrow, the ease of transit uni and as well have worked very well together to integrate their processes. And so probably that really helped to overcome that potential. Um, stumbling block there too. So good for you. So you enter into the terms January. Um, no, no, yeah, end of January, 2018 and it’s, it’s funded. No problem. It’s still end of January. I mean, he was pretty quick. And then, uh, he just misses his, the final paint, the 6,800 with the balloon.

He may be back. Yeah, he missed that payment. And the thing was that he went totally dark. I mean, I sent him emails through the university platform. Um, escrow.com send him payments. Mr. I’m sorry. I sent him emails as well directly to him because he was a customer of theirs as well. Uh, but he just went totally dark. He just did not respond at all. And, uh, we sent an email saying, Hey, we know we’re gonna, we’re gonna, um, basically basically around the end of, um, at the may amount of around may 11, um, as escrow.com sends them a message saying, Hey, you’ve got a seven week, seven day cure period where you’ve got to make this payment or you’re going to be in default of the agreement and we’re gonna, we’re gonna, uh, allow the seller to keep all the payments that you’ve made to date and we’re gonna give the seller the domain name back. Yup.

And ask her, does a great job just streamlining that as well, you know?

Yeah. It’s super, super easy for me and uh, but we never heard from him. So, uh, he didn’t, uh, cure, uh, the transaction and, uh, so I got to keep my 3000, $200 and he made, uh, up until that point and I got the domain name back to my in registry account from escrow.com. So it was, uh, it was a transaction where, uh, I made $3,200 on not selling the domain name.

Wow. Yeah. No. Did he utilize, do you think that he was trying to boost his business? Um, and instead of actually receiving his own personal tax refund, he was trying to just, you know, what if he was spanning people, what if he was, had, you know, a website up directing business and thought that he’d get so much extra CPA business by April 15th, that he’d be able to pay it off?

I really don’t know. I just know that he was a younger CPA probably starting out. Um, maybe thought he could differentiate himself in the marketplace by focusing on crypto transactions. Um, people cause back then, uh, back then quote unquote, a couple years ago, it was very, uh, uh, you know, unknown. It was very strange how to even account for crypto currency transactions might have been before the IRS even put out there a their own documents on how to account for cryptocurrency transactions. Uh, so it really could have been a rate point of differentiation in the marketplace for CPA at that time.

Very, very true. And did you have anything in place protecting you from or protecting the domain value from, you know, if a got blacklisted for spam or anything like that or you weren’t really worried cause you could just kind of see where he was gone

in the terms. I said that if, you know, if he were to use it in such a way that would be, have a negative impact on the value of the domain name, he would be in default of the agreement. Um, but he never used the domain name during the period that he was making payments. So it was never an issue.

So there was no website put on it, nothing like that? Nope. Nope. Even though we could have,

he could have, yes. escrow.com would allow him to, uh, use the domain name through their DNS system.

Okay. Interesting. All right. So he defaulted, he went completely dark. Uh, and do you think that Bitcoin prices affected now? How did Bitcoin prices change from the time that you entered into the agreement? Until the time that he defaulted?

Um, it was basically going down because, uh, you know, after January, 2018, uh, from $19,500, by the time he defaulted, I think it was about, uh, 8,000, $300. Uh, so it had fallen by more than $10,000 by then. So, you know, that kinda got me wondering about, you know, is this, is this domain really worth that much? You know, cause this Bitcoin thing seems like a, everyone’s kind of bailing out of it and, uh, it seems not to have the promise that everyone thought I was going to have. So maybe this crypto cpa.com domain name really isn’t, isn’t worth all that much.

Yeah. And maybe he was going through that same thought process. Interesting. But he didn’t turn around and say, Hey, it’s not worth anything. Give it to me cheaper or try to renegotiate in any way, shape, or form.

Right, right. He just, he didn’t just went totally dark until later. He comes back up later.

Oh, there’s a great time for a commercial break. Yeah. Um, so, um, so next you listed the domain with media options. Now, thus far, you’ve done no outbound brokerage on it. You just had it listed on, um, you know, as buy it now at uni, right?

That’s correct. That’s correct. And, uh, cause I thought, you know, at that point that it had some value on its own and that people would find it. Um, and, um, and despite her obviously did find it and, uh, made an offer and just didn’t go through, you know, so yeah. So I decided to do an outbound approach to it. Uh, that was probably in what, July, 2018 after I got it back from escrow. And, uh, uh, you guys had announced you’re gonna be doing a crypto, a domain name newsletter. And so I let you know about that and you guys ran it, um, in July, but I don’t think there was ever any interest in the domain name from the newsletters so it didn’t sell.

Yeah, no. Um, there were, I mean a 2018 was a huge year for a crypto domain purchases in general and, uh, media options ran a, um, this crypto newsletter for a period of time just to help with the demand. We didn’t want to overwhelm our regular newsletter being exclusively crypto names, but there was just such huge interest in it. Um, and um, but no, nothing came through for, for crypto cpa.com as an outbound. Uh, I mean, not, you know, not an aggressive outbound, but just a, you know, putting it out there and then, um, you know, you, so it’s neat. The automation that supported you in this process. Logan, um, you know how escrow automatically transferred the domain back to you after the buyer didn’t cure how then in September the uni registry broker, they, they knew, did they automatically know that the sale fell through because of the connection between them and escrow or did you relist it?

No, it’s a little of both. Um, um, you know, I have the setting, um, there was a setting within university market where you can say a, once a lead kind of goes dead, you can choose 30 days, 60 days, 90 days, 120 days for when a university broker can pick it up from you and try to go after the lead themselves. And I had that setting. It must’ve been 120 days or something at that point. Um, so, uh, drew, uh, I think it was named [inaudible] ski, uh, was a, is a broker over at union registry and he automatically send out an automated email to the fire who defaulted M and. M basically he ends up talking to the guy later in October. Um, and Don got got on the phone because they have to, he’d gone dark, but he did get the guy on the phone and he said, um, you know, Andrew was kind of excited cause he thought why he made those payments in the first place and if we can get him to pick back up right.

And I didn’t want to, I didn’t want him to pick it back, buck up. I wanted him to understand that that $3,200 was a done deal and that he had to have to start over if he wants to buy the domain name now because we had an agreement and he didn’t finish the agreement. Um, but drew talked to him and he said he’s no longer in the market. He just, he had no funding for his business plan. So it sounds like he didn’t really have the financial means to, to really buy the domain name in the end. Um, uh, so, you know, he, he basically was a dead end, even though we, we, we got him back on the phone. Um, but drew drew himself was, was pretty adamant that he thought that I had this domain name price too low. Cause at that point I had it back around, you know, the, the $12,000, whatever it was. And he thought that I should be pricing in around 35,000. And by this point, um, you know, Bitcoin’s around $6,500 a Bitcoin and it’s like, okay, you know, I don’t know. I don’t know how he gets 35,000 cause to me the price is going down and the whole market seems to be going down by October, 2018. Uh, so I was little more skeptical about $35,000, but I did put $35,000 buy it. Now I’m at uni registry as well as after Nick just to see if the market would, uh, would there that price.

Interesting. Yeah. Okay. And did, did he give you any background to what went into that thought process for him?

I think register. He had been selling, you know, other crypto, uh, domain names and uh, was getting pretty good prices at that time. Like crypto world, you know, Mike man and sold his for over a hundred thousand dollars. I think it was by that time maybe. Um, so there were comps out there. Um, but I just, you know, the whole temperature of the Bitcoin and crypto market by that point, which is getting more and more negative. Um, but at that point I was shorting Bitcoin and making money shorting it. Um, then I made more money shorting it than I did actually owning it. And um, because by December 16th, 2018, Bitcoin hit its low point. It was 3000, $200, um, by December 16th. And so it just, I just didn’t think was going to go anywhere anymore. I thought it was, I thought the market was totally deflated and I just didn’t really think that this domain, it would be worth anything much anymore. But, but a registry or at least drew thought $35,000, was it

the price for it. That’s neat. And I can say on the broker end, certainly I, I mean 2018 was hot, hot, hot for selling a crypto domains to end users because these crypto companies really, really have the most intimate view of their market. And they knew that this market was going to continue to grow and they knew they needed domain names and brands that would, um, that differentiate themselves within that market. And so, um, I think that just really speaks to the importance of getting a broker’s perspective. Even though so many, um, transactions are private in this industry, even if the broker can’t tell you that, they can tell you, Whoa, quadruple your app. I mean, that’s almost a quadruple right. We’re around eight and you moved it to around, you know, eight something to 35 ish. That’s, you know, that’s, that’s a big change. And you really, and you trusted the broker, but you had nothing to lose. Cause like you said, you were seeing what the market would bear. It’s not like you were, you know, in need of liquidating right away. So well done, well done. Let’s

be plus Bitcoin and fallen from $19,500 in January of 2018 all the way down to $3,000 by December, 2018. So I was making money as it was going down, so I was more of a skeptic about Bitcoin than perhaps the broker was and they’re going to get, and the broker did have more insight into the market for the domain names related to the space. Um, so I just went with him and thought, you know, $35,000 worth price it and I would wait. Yeah. But I waited about five months, so by may 20, 19, um, there had been no interest at $35,000 in the domain name. It just, um, again, I would just getting more and more skeptical about, um, about the value of the domain name itself. Um, so when I saw, um, there was a broker named Michael law. He works for QE IP, which I’d never heard of it before.

Um, but I saw him post on LinkedIn about that we’re going to have a newsletter going out with FinTech, crypto and blockchain names. Um, so I thought, well, you know, Hey, maybe I’ll do another outbound on it, but I’m gonna lower the price. I’m gonna, uh, you know, put it, I’m going to maybe a lower bounded down to $15,000. And so I talked to Michael and, uh, we put several of my blockchain and crypto names, uh, in a newsletter that went out, uh, later, but I did put a crypto CPA at a $15,000 in that newsletter. Um, and, uh, uh, and I redirected all the landing pages for the domain names that I had in the newsletter to QE, IPS, no DNS, uh, so their, their pages would come up instead of UN registered markets. Um, so, uh, that newsletter went out around May 25th of this year.

And, um, uh, they also, about a couple of days later, they followed up with some, uh, some of the newsletter subscribers and kind of did, you know, outbound calls to them and they immediately got a buyer on the line who was interested in the name and want to know more about, could you do it, could you do a payment plan on that $15,000? Of course, I’m like, Oh, yes, I love payment plans because, you know, I was like, okay, yeah, let’s see. Let’s see if I get this guy to make payments on, on the $15,000 for a domain name. And maybe he’ll default or, you know, who knows. Um, but, uh, uh, so my goal at QIP, uh, started, you know, working with him to try and get to a point that we could agree on a price. Um, and that took a, that took a little bit, um, basically, and I said, yes, I’d be willing to finance it. But about a week later, early June, um, the buyer comes up with an offer and his offer was $7,900, a lump sum or $10,000 in four payments.

Oh, your people like 10 grand in payments

and uh, uh, NAC. He suggested a 40, 20, 20, 20, so 40% up front, 20% over the next three months to get to the $10,000.

Now was this purely the buyers suggestion or did Michael help set expectations and reframe something else that the, you know, how sometimes buyers have their own ideas and then someone can kind help them work

that into a structure? Yeah. You know, I was pretty firm with Michael that, um, if it’s a, if he wants to do payments, it’s gotta be full to full $15,000. Um, and so Michael knew that, but the, by himself came back with this, this offer is counterclaim. He’d be willing to pay $7,900 lump sum or $10,000 in payments.

Okay.

So I countered that same day with, well, I could do $13,500 lump sum, but do you want to do payments? It’s still gotta be $15,000. So why not make that $7,900 lump sum a first payment on the $15,001 and then you can pay off the remaining $7,100 over a time period, maybe up to 12 months. That would make it easier for it. Make it easier for you, you know? Yeah. Um, but a, the buyer didn’t accept that. About three days later, he came back with another offer. Okay. Which was $8,900 lump sum or $11,000 financed over four months. And he was not, he said, he said, he told Michael he wasn’t willing to go any higher. Um, so I didn’t necessarily believe that, but, uh, I countered with, okay, how about $12,000 lump sum or $15,000 in payments, uh, with $8,900 down since he was willing to pay $8,900 in a lump sum with that. Well, I’ll take that as a first payment. Um, and you’re gonna do, you can do the reigning $6,100 over up to 12 months. Um, what about two days later on June 13th, the buyer just accepts the $12,000 lump sum. Huh?

No insight into why or how that developed it just boom,

no, just we just, my goal of working with them to get to a point, but it also me working the price down. I, you know, I was $15,000, uh, pretty pretty firm of $15,000 with payments to be more flexible. If you could come up with a lump sum payment that was, you know, probably not less than 80% of what my asking price was. I try to stay with an 80% of what my asking prices. Okay. So $12,000, I think it’s about 80%. Um, but he agreed to the $12,000 lump song. I agreed to that as well. And, uh, that too went to escrow.com and uh, um, by June 19th, we were making a transfer, um, directly the buyer and I were exchanging the auth code basically.

Okay. So I mean that took about 1920 days and it sounds like quite a few offers back and forth. If you had to guess how many,

you know, offer counter offer, there were just those three. I believe there’s three. Um, and uh, you know, Michael was working with the buyer along the way. I’m staying pretty close to touch cause, but once he made that first offer, it was only about five or six days, I think till we got to an agreement. And by that time Bitcoin has got back up to 9,000, $300. Uh, so you know, the, the value of this domain name was kind of going back up. If you think about how at the end of 2018, there was only $3,000 a Bitcoin was. But by the time we closed this deal, it was about three times that. And uh, so the value of crypto cpa.com to ACPA. And this, this, this buyer was a CPA based in New York and New Jersey, um, who want to differentiate himself in the marketplace as an expert on crypto transactions. Um, you know, by the time it’s a three, $9,000, then it is a more valuable domain name. And I think by that time, paying $12,000 for it was a good deal for the buyer.

Yeah. I also think, you know, the volatility in general, like that’s the thing with taxes. It doesn’t matter if you made money or you lost money, you want somebody who can help you that work for you in your taxes. And so even if these folks are losing money, they want an accountant who’s going to know about it and help them write that off or somehow deal with that somehow benefit somewhere from it. Right. And so it’s just, um, interesting to see that the Bitcoin pricing, while it did affect the, you know, perceived value or excitement at times. Um, at the end of the day, any accountant knows they’re gonna make money off of this win or lose. It’s actually the volatility and the big changes in pricing mean people are winning big and losing big and meeting to account for that on their taxes.

Right. And it also, it also affected me in terms of, you know, I was making money while the price was going down and I was getting more and more skeptical about Bitcoin in general about, you know, it’s just, it’s just basically another.com bust, uh, or a a, you know, a tulip bubble, whatever, you know, if that would just be my value of the domain name was going up and down as well as it was oscillating. Uh, so, um, not only did it affect the buyer in the market, it affected me personally as a domain name investor, what the value was.

Yeah. And I think, you know, in terms of seeing what the market would bear, um, you do know that if this particular buyer had this much trouble, trouble coming up with, you know, the 15 grand, 35 grand was not gonna get you anywhere. Um, you know, um, so, um, so June 19th, you tried the auth code and since it was a lump sum, June 20th, boom, uh, you’re done.

Yeah, that’s right. And, uh, so, uh, Michael and the QE IP team, uh, took a 20% commission, uh, for doing a great job. I talked, you know, definitely worth the money, uh, to help them, have them find the buyer. Um, so I was happy to pay them the $2,400, uh, for their services. Um, um, in the end I got $99,600, I think, uh, into our, our bank account at media code. And, uh, but what’s interesting to me is the total value of the trends of the domain name over time. Uh, you know, I only paid $144 for if you include the $145 at the auction, plus the renewal, what GoDaddy costs about 800, I’m sorry, $8 and 77 cents. When I transferred it to [inaudible] registry where I consolidate all my domain names. Uh, so I only had $144 in the domain name. Uh, but I sold it to a buyer who paid 3000, $200.

So I got my money, got my $144 back there, plus profit. Uh, and then I sold it again for, you know, $12,000. So that’s about 15,000, $200 gross that I made on this domain name, having paid $144 for it. Uh, but one would you take out the, the $2,400 to QIP EIP for their brokerage services. Um, I pocketed $12,600, um, net, um, which is about, yeah, at 83% net profit margin, um, on that 15,000, $200 that, uh, was involved in it. Um, and in the end, I had almost a 9000% ROI on this, on this deal across the two transactions that occurred. So I was pretty excited. And, uh, you know, I think it’s a great domain name. I really hope that this buyer makes good use of it and really differentiate himself in the marketplace as an expert on crypto accounting. And, um, I’m excited to see what he does with it. India.

Yeah. That’s really neat. And it’s neat too that the buyers that you did work with were both end users. Yes. Um, good for you. That’s, you know, you know, you’re really working with, um, with good, uh, good domain and with a good brokerage services doing that. Um, you know, I’ve been spending a lot of time by the pool this summer. You’ve got your pool in the background there. Um, I keep seeing these, these, you know, these divers actually, sometimes when I, um, take my daughter to swim team, the dive team is practicing and I see they’re really doing great. Like those crazy flips and like Olympic [inaudible] stuff. Um, but I feel like this isn’t just a profitable flip. This is a one that’s what I’m seeing in my head. The, the fancy dive profitable double black back flip or something. Yeah, yeah. Well, well done. Yeah. And that think to Logan, um, that sense that you have of that you didn’t go back to that original buyer and try to work something out that you knew what the value was. You knew what you felt right about. Um, despite all that Villa volatility and uncertainty that you had about its value or, um, uh, or viability, you still new. You don’t go back and renegotiate after you’re in the middle of a contract.

Yes. And I also know, uh, being a finance guy also knows CPAs. Uh, my brother and sister were CPAs. Um, uh, and they’re not spendthrifts. So, uh, as I, as a stereotype, and, uh, so I knew that the reason why I was skeptical at Drew’s suggestion of $35,000, I knew my target audience were accountants. And I knew from my experience working in consulting with accountants and accounting firms and financial firms that, um, I don’t know, I’m not sure an accountant’s gonna pay $35,000 for this name, but 15,000, 12,000, 10,000, that might be a little more fair because this, this, this unique skill they have related to crypto accounting. We sent them, they could charge a premium for with all these people making millions of dollars, uh, from their crypto transactions. They’re probably willing to pay a good premium per hour to a CPA who understands it, understands the IRS, uh, treatment of it. And, um, so I thought, you know, I thought yes, I could get an accountant maybe to pay up a little bit a for domain name related to it, but probably not $35,000.

Did you think it was more palatable to someone in, to an end user in that industry or did you think it was more like the ROI they would see in one tax year? Uh, when, you know, texts season? Um,

I just, I just thought that, um, you know, a smart CPA would know that there are people out there struggling with accounting for cryptocurrency transactions and if they are truly experts at it and understand the IRS interpretation of them, um, then, uh, and they put themselves out there as a expert on that, they could probably make a lot of money in the first two, one, two or three seasons tax seasons, um, with this domain name and having that differentiation because, um, at that point, obviously, you know, Bitcoin is back at $9,000. Um, something’s going to be happening. It’s going to be in there in the future in some way. Um, so it’s something they could really start a new kind of business on and, uh, do well with.

Yeah. Agreed. And then this wouldn’t be a good interview if I didn’t ask. So where’s like Thanksgiving dinner with your family on this menu? What I mean on this Excel Excel spreadsheet on your timeline. Um, what did, did you try to sell it to your family of accountants? Did you discuss it with them? Did they disagree with you on what you were doing? What, what did they think about, you know, you putting your foot in their area.

They didn’t think anything of it. Um, I didn’t talk to them about it at all. So it was, it wasn’t, it didn’t, it wasn’t a key point.

Ah, so no it and no domain names.

Yeah. They don’t understand the whole domain name business I’m in, so I don’t talk about it really

is that now. That’s funny. Yeah. Think many, many of us relate.

Yeah. It’s different.

It is. It is. And sometimes I feel like once I explain it, even if they got it, then they can’t remember again. Right. Um, it’s a lot. It can be a lot to absorb. Just like crypto can be a lot to absorb. Um,

it’s okay. It’s all great. It’s all very technical. So the lay person out there across America, around the world, you know, it’s too technical for them. And, uh, both, both domain names and crypto, which are both digital assets. Um, a lot of people who were just on tactical don’t, don’t understand it, don’t get it and don’t want to really try to understand it either. Um, even if they get some excitement of hearing about their friends making a bunch of money or uh, you know, see the, see the articles in the, in the news about Bitcoin going up, you know, that 19,000, $500 and they may want to dabble in it, but they still don’t understand it fully to it’s, it’s too much of a risk for them.

Yeah. Now I have a question about the auction. When you originally purchased this domain back in July, 2017 had you already researched that it had been purchased and dropped. Did that, would that affect your decision to bid on something? Do you do that much research in what you bid?

I will if I see their trademark issues potentially with an aim to see who owned it previously. And in this case, no, as soon as I saw the domain name come across the the screen, I saw crypto CPA and I was already in the market for buying crypto and blockchain names that, uh, um, I was like, Oh, I want that one. Plus, you know, cause I just knew that again, the some accountant out there would want it, um, because uh, be something that could, they could differentiate themselves with in the marketplace.

Huh. Okay. And what about selling to an end user like H and R block or some big tax a corporation? What, um, were there any um, plans to do that? Any feedback about that kind of,

no, I really didn’t think, I didn’t really, didn’t really think it was a corporate domain because it’s a singular CPA. Um, there is another business@cryptocpas.com. Um, but I didn’t think about approaching them either and I didn’t think about, uh, outbounding this to any large corporations, things like that. I just didn’t think the brand itself, crypto CPA lended itself to a big company. A lot of those big companies already have huge investments in their brand. Like H and R block, um, Liberty tax, things like that. Um, I shouldn’t see what there is, shouldn’t be in it. Um, which also put a downward pressure on what I was, I thought the value was, um, you know, a big firm like that if it were for a different name, but in the same, uh, industry that I thought maybe a bigger firm would want to buy it and yeah, maybe $35,000 made would make sense in this case. It just felt more like a mom and pop kind of name. Um, you know, and like a small, uh, CPA practice would, would buy it. And that’s ultimately who bought it twice,

twice, can’t feed that Logan. You know, I think that your expertise and background as, um, you know, in marketing strategy probably informed that decision, right? Because a big corporation like H and R block, they might do, um, you know, 10 years from now I might do a marketing campaign, you know, we know crypto or something, but they’re not gonna want crypto CPA or crypto CPAs to redirect to them and get some random minute amount of business. For what they’re doing, it’s just not even worth lawyers time agreeing to buy it. Right.

And they don’t go to market with CPA, uh, in any of their marketing. I mean, they don’t, they don’t necessarily care that their market, the people they attract as consumers or customers don’t care about whether an accountant has a CPA designation or not. They just want their taxes done. They want their refund and they may want a loan to get that refund and quicker in an advance. Um, you know, it’s a totally different market. Um, they’re not like a high net worth individual who wants a CPA doing their taxes for them. Who cares about that designation? So I don’t think HR block would ever want, uh, probably any domain name with the word CPA in it. Uh, I certainly not crypto CPA.

Yeah. I think that foundational understanding that you had really informed not only your sales strategy, but also your, your pricing. Um, yeah, that’s, that’s really good. So, um, huge congrats. Um, and Logan, you’re such a sport to come on here and you were such a sport. I forget. How did we wind up connecting? I was in Dallas visiting family and I think we just emailed and I said, Oh wait, you’re in Dallas. And we went out to lunch. It was, it was super cool. But you are always so open in the demean industry. You’re fabulous. Um, interview what, like two, three months ago with Andrew Alaman I’m always so open and sharing your expertise. What do you see right now? Like last thoughts, insights, what are you excited about? What are you working on? Um, what, what are your thoughts right now in the industry? Logan?

Yeah. And you know, one thing I talked to Andrew about was how, you know, I’m hoping that we can get the industry or the, are these the, the sector that we’re in domain name investing more professionalized. I’d like to see, you know, uh, more domain investors acting more professionally. I’d see more domain buyers acting more professionally. Um, you know, and, uh, just, you know, overall doing a more professional job of, of trading these, uh, domain names, these digital assets. Um, and so, you know, that that podcast I did with him was more about professionalizing my business, creating media code LLC. Uh, having a CPA helped me with the accounting side of it and everything else. Uh, so, um, you know, I’m just encouraging out there too. Don’t just do this as a hobby if you’re really serious about it. Uh, you know, get more, get more organized, get more professionalized, um, and uh, you know, treat each other better.

Um, you know, don’t put everybody down if you disagree with them or whatever. Just just be very positive and supportive of the industry. Um, and, uh, help us get a better reputation as domain investors that, you know, we’re, we’re going after these generic domain names that, um, you know, are not trampling on anybody’s trademarks and, uh, we’re trying to do it the right way. Uh, but it’s a legitimate business. It’s just like real estate. Um, it’s just virtual. So, um, that to me is what’s important. And, and me coming out here and talking about these things so people, other investors can see what I’m doing is try to make it a, you know, a, a better business for everybody.

Wow. That is, you know, a powerful message and one that we, um, I think many folks do appreciate you sharing. And um, you know, I think as more and more people discover the, just not only the profit profitability of the two main industry, but it’s just fascinating. Um, it’s exciting. It’s interesting. And the people, because nobody goes to school and takes a, uh, you know, gets a degree in anything related to domains, let alone really a class, even digital marketing or classes, they might mention domains, but you can’t even take one class on it yet. Um, and so everyone in this industry is from such diverse perspectives, backgrounds, experience, um, that it really, really is such a fascinating, uh, group of folks. And, um, you never know what’s coming next. So, um, I think though, as more and more professionals enter this industry, I like, um, how drew Rose nor always says, you know, just making the pie bigger and truly, um, the more professional we are, the more that we build up our community, the more that we educate. I mean, that’s domain Sherpa’s mission is we just, you know, offer this education to level up the whole industry and, um, and it’s neat to see how you do that individually. Logan. Thank you.

Yeah. Yeah. And I think, I think it’d be challenges the irrational behavior of the buyer sometimes where, um, you know, they think that they have, they’re entitled to the domain name that you’ve had for five, six, 10 years. Um, and they would never behave that way with someone who has an empty lot in their neighborhood. You know, that someone’s not using, they would approach them and say, Hey, here’s 50 bucks for this, this lot that’s worth three to $300,000. You know, would they would insult them with such a low offer and they wouldn’t insult them with actual words saying, you know, you’re scum for having this domain name and not using it. It would never say that to the person in their neighborhood who owns that lot. Um, they would treat them with respect and, uh, would, you know, if they’re serious about it, they would find ways to get the money to buy the main name at the price that the seller is trying to sell it at. And so with domain names, it’s, it kind of goes out the window. And I think it’s a, I think a lot of buyers just have this sense of entitlement that’s not there unless they have a trademark situation where, um, someone is sitting on a domain that has their trademark in it, uh, and they can prove to an arbitration panel that, you know, they indeed have rights that precede the rights to the domain name holder has in that domain name. So

there’s a lot of education that needs to take place, but education can’t even start without credibility, without, um, trust. And, um, that’s why we as an industry really need to, um, work on our presentation and encourage others who may be lacking that. And, um, and then because you can’t teach someone if they think you have nothing to teach in the first place. So, um, and I think a lot of progress has been made and will be, con will continue to be made. So Logan, it’s such a delight to have you on. I hope next time it’s not so long. Um, and I don’t have any plans to be in Dallas soon, but, uh, when I do, I’ll let you know.

Okay. Well I’m, I’m, I’m going to try to avoid Phoenix this summer, so don’t send me to come into Phoenix anytime soon. Okay.

He visits Phoenix in July. Ever

degrees here, so I can, I can imagine what it is in Phoenix.

Yeah. And big co kudos to you. I know you put thought into your lovely background for all our viewers. Um, we do not always have the prettiest backgrounds, but, uh, kudos to you. That is a beautiful Rose garden. And, um, and every so often I see the beach ball float by

visual interest instead of just a blank wall. Yes.

Yeah, yeah. I think now you just need to go outside and do the fancy dive and that’s how we’re going to end, right, Logan?

Okay. That’s right. That’s right. I promise I’ll do it after we, we’re off the air, so,

Oh, all right. Okay. Well, I’ll see you next time.

 

Watch the full video at:
https://www.domainsherpa.com/profitable-flip-crypto

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4 Responses to “Profitable Flip: Crypto Domain with Logan Flatt”

  1. Uknowledge says:

    Another nice interview featuring the Smart Logan.Always interesting to hear what name he sold.

  2. Ricky Deas says:

    Hi Tess, Thanks for another informative interview. You made some great points in the closing words on the industry. Love the passion you have for the business.
    Logan; that flip was very exciting. It was like a movie with cliffhangers and you came out on top. Great negotiation. Closing thoughts were very encouraging as well.

  3. Rod says:

    Well done Logan and congrats on another great sale/negotiation. Keep on killing it!

    1. Logan Flatt says:

      Thank you, Rod – I am looking forward to your next time on DomainSherpa!

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