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.CO

18 January 2011

Sedo Plans Second .CO Auction, Plus Some Thoughts on Knowing When to Sell

Sedo’s Premium Generic .CO Auction, which starts on February 10th and runs for a full week following GoDaddy’s much-hyped Superbowl XLV commercial, has received a lot of interest from domain investors. So much, in fact, that a rep for the company told me today that they’re already planning a second auction (for which the dates haven’t been set yet).

February’s auction includes 175 names, including many of Mike Mann’s (Codom Holdings, LLC) premium names. With the exception of a few headscratchers (how did that get in there?) set at low reserves, there are some GREAT keywords up for grabs. Here are a few:<!--more-->

art.co
automotive.co
bath.co
biking.co
cigar.co
dance.co
exercise.co
friendly.co
lasvegas.co
restaurant.co
movie.co
creditcard.co
bank.co
gas.co
gold.co
health.co
investing.co
internships.co
luxury.co
fitness.co
finance.co
drugstore.co
clothing.co
pizza.co
luggage.co
technology.co

In full disclosure, yes, two of those are mine: Friendly.co and Internships.co.

Sedo has an extensive list of buyer and end-user contacts, and I’ve been assured that their brokers are actively reaching out to companies about this auction. I think it’s interesting that they’ve chosen to go ahead with a second auction before seeing the results of the first one—and it obviously benefits them, since there are so many people clamoring to submit their names, and even if they sell at low reserves, Sedo gets paid. It also benefits those who have .CO portfolios and are looking to sell their names. Which brings me to my next point:

How do you decide when it’s a good time to sell?

I have enough decent .CO domains that I could sell a few and still keep plenty as longterm holds. I didn’t register most of them as “flips,” and I’ve always thought it would be silly to sell your best 1-2 names early on. Then again, there’s something to be said for using the .CO “hype” to your advantage and striking while the iron is hot.

I could submit names like MortgageLending.co, Borrowing.co, Naming, co, and HealthProducts.co with no or low reserve, but that’s a risk. There seems to be an art to auction pricing because on one hand, a low reserve encourages bidders. But if the name doesn’t go beyond $60, well, you’re screwed. All of those names are ones I’ve had private offers on and I’m fairly certain they would go for more than that, but that’s the risk with low reserve auctions.

I consider my premium Spanish and German terms to be longterm holds. Oddly enough, the names I’ve received the most offers on have been Anna.co, Friendly.co, and Girokonto.co (German for “checking account”).

I registered many of these names with the intention of holding onto them for 2-3 years, but now it’s being suggested that I submit a few of these very strong, one-word names for insanely low reserves. I want to make sure I’m not shooting myself in the foot.

I like to experiment and test out different strategies, so I’ll probably throw in a few no/low reserve names in the second auction, but I have to pick the right ones. I’m not risk averse, but I do try to think things through beforehand so I don’t end up regretting my decisions.

Are you buying names as longterm investments, or are you content with flipping a .CO 3-5x what you paid for it?

If anyone has thoughts on selling vs. keeping names for the long term, I’d love to hear them.

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About Nadia

Nadia is the editor of DomainSushi. Her love affair with domain names and web development dates back to 1998, and she is passionate about educating the tech community, small business owners, and laymen about domain name strategy. Follow her on Twitter: @DomainSushi.

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13 Comments

  1. AndersonJan 19, 2011 at 2:56 am

    Most of my longterm domains are speculative names. These make up about 10% of my portfolio. But these are longterm “conditional” domains, if you will, and are based on growing (not emerging) market trends. “Conditional” meaning if tomorrow there is an acute demand for the spec items or popular demand, I won't hesitate to sell. But who knows what tomorrow will bring? Market awareness could change in 24 hours, 3 years, 5 years or even 10. So for each of these spec names I have set a time frame. Upon expiration of the time frame, I'll sell really cheap or drop.

    The rest of my domains I wouldn't mind flipping for 3x-5x, unless I have a hunch an enduser may be willing to pay more. In which case a domain becomes part of a new category of domains called “right offer” domains. “Right offer” domains could be long or short term domains.

    Setting a no/low reserve is beneficial when some bidders are endusers. Anything can happen when domain investors are the sole bidders. They are naturally prone to changing their minds about how much they are willing to spend. This is understandable since they view most domains as an investment opportunity and not the corner stone for a business venture.

    Generally, it helps to ask some questions before a domain is sent to auction:
    1) How desirable is the name?
    2) Who would want the name?
    3) What would they want to use the domain for?
    4) What do I expect the domain to sell for?
    5) How would I feel if the domain sells for less than I would like?

    The first 2 questions may seem similar but aren't. There are desirable and “want” names. Like.me is very desirable but not too many buyers would care to own it. Web-design.com is both a desirable and “want” name.

    And it also helps to look at past auction sales of similar names. :)

  2. NadiaJan 19, 2011 at 3:18 am

    Hi, Anderson, thanks for the detailed comment! I agree with all of your points, especially about having “conditional” domains. Every investor ultimately has a price they'd sell for. One of the best quotes I've read (and I don't remember the source, or else I'd give them the credit) is “if you're doing this correctly, someday all of your names will belong to someone else.”

    I have a similar way of looking at my names, except since I've added so many new ones in recent months, things have shifted around. I need to sit down and prioritize them all. I'll be doing that with my .COs in the next few days.

    In general, the names I've been submitting have been ones I feel satisfy #1-2 in your list, but aren't names I'm particularly attached to. Once I've received 3-4 offers on a name, that lets me know it's something multiple people would want.

    It's hard to base things on past auction sales of .CO, because well, there have only been a few, including the landrush and Latona's (which was hardly publicized and didn't have a platform nearly as accessible at Sedo's).

    I do check past auctions of related keywords – 'friendly' is not exactly the same, but Pengyou.com & .net (“friend” in Chinese) sold for $100K and FreeHoroscope.com was $185K in '07.

    The actual .CO auctions have been all over the place.

    #5 is probably the biggest thing. It's not like I would have a whole lot of time to shop a name to individual buyers in the next 20 days, so there's no way to gauge end user interest before signing Sedo's sales agreement. So I'm going to try to stick to names that would appeal to investors but hold onto the ones that my gut is telling me have the potential to appeal to end user companies a little bit later down the road.

  3. Mark FultonJan 19, 2011 at 9:19 pm

    I think you have the right idea, Nadia. Hold on to those domains for a few years. Throughout 2011 .CO will be gaining even more traction. With the introduction of new gTLDs, exposure to the industry is going to spike as dozens of extensions are launched. Many of these will make .CO an even more attractive option as it is a higher quality extension with valuable meaning behind it.

    I wish you the best of luck in the auction, but I think right now the buyers just won't show in force.

  4. NadiaJan 19, 2011 at 9:54 pm

    Hi, Mark. I appreciate the comments, and the fact that you took the time to stop by. I think you're right about holding on to the names – I'm not looking to liquidate my .CO holdings any time soon. I might throw a few into the second auction, but I think I'll hang onto my my best ones.

    Thank you! :)

  5. AbdelJan 23, 2011 at 12:13 am

    I'd say hold, unless you get an offer you just can't refuse.
    I saw your .co portfolio, you have really nice domains there. I am sure they will be worth $$$$ in the future. Alot of people still dont hear of .co yet!!!
    Personally I love flipping my domains, This saying stock in my head “Don't fall in love with your inventory” Don't get me wrong i feel bad sometimes after I sell a domain.

    Good Luck with your auction Nadia :)

  6. Jason Allen GoodlinJan 24, 2011 at 10:11 pm

    HI Nadia,

    Cool domain blog. Congrats! I always see your comments on EB and the Domains. It's cool to visit your website. I found you through Twitter. You follow my DomainingMojo feed.

    I believe that it's a good time to sell .co. I only purchased 6 .co. I submitted QRT.co and ResumeServices.co last night. I don't mind if they reject the domains. I own many resume domains, which are easy to sell.

    I also own Aesthetician.co, Suisun.co, BryantPark.co, and Pier39.co. I didn't submit the tourist locations due to Sedo's criteria. I plan to keep aesthetician.co as a long-term investment.

    I don't think buying .co to flip at 3-5X is even worth the time. I can buy .com and flip at 10-250x. I have been able to do it. I stopped buying .co because of the price. I continue to find many quality resume, education and job domains.

    In my opinion, I would test the .co market. There are still many good domains that are unregistered. Great blog! Thanks.

  7. NadiaFeb 1, 2011 at 4:28 am

    Hi, Jason,

    Thanks for contributing, I really like your blog as well! I tried commenting on your post about Sedo the other day, but I don't have any of the profiles necessary to log in. I obviously have a Gmail account, but it's Google apps which is run off my own domain name, and for some reason, it didn't work when I tried to log in.

    I wish there were an option to log in with Twitter, because my Facebook isn't an identity I use for domain-related stuff. I guess I could just sign up for an OpenID account. :)

    Anyway, yes, I agree that .CO is overpriced, and I'm hoping the renewals come down this summer. I've decided to hold onto the better names, but I don't mind selling some of the lesser 2-word combinations for a profit this year. It will allow me to reinvest in some better names.

    Keep up the great work with your blog!

  8. NadiaFeb 1, 2011 at 4:29 am

    Hi, Abdel, thanks for chiming in! It will be interesting to see what happens. I've been working really hard to promote my 2 names in the auction.

  9. EricFeb 2, 2011 at 2:25 am

    I guess this post is a reply to everyone else who already commented! I've registered so many .CO domains (over 100). I've been selling a bunch in the $100 range. I don't mind too much since i have so many. I guess that I'm afraid of having to renew so many at $30 a clip. Some i have regretted not getting more for. sometimes i think that it is best to let go of most of your middle or lower quality names even if it is only at 3X-5X what you paid for it and keep just those few high quality names you were lucky enough to get. I mean owning so many can get expensive and the fear of those renewal fees adding up really gets to you because you fear how long it might take to get “top dollar”. I say take the money and run and just keep a few high quality names because that is all you really need! I was lucky enough to get CLEANENERGY.CO, CLOUDCOMPUTING.CO, NATGAS.CO, BIOFUELS.CO, FUELCELLS.CO, and the hyphenated GO-GREEN.CO. I still have around 75 or so others that i think are pretty decent for sale on my site at erichatch.com. :)

  10. NadiaFeb 2, 2011 at 2:36 am

    Hi, Eric. Thanks for stopping by, and for your little sales plug. :)

    CloudComputing.co is certainly a winner. You're right about hanging onto the best names, which is basically what I'm doing. I figured I'll also be picking up some new ones during the massive avalanche of drops that will happen this summer. So it's essentially a cycle of selling off the lower value names and stockpiling the best ones I can find. Keep up the great work with your site! :)

  11. JoelFeb 10, 2011 at 6:50 pm

    Just have four .co's only and will hold for a while to see what happens with the market. My goal was buying .co's that had over 20,000 exact term searches only. So the winners are Layla.co 91,760 exact searches, arron.co, leann.co and Reyna.co (Queen in Spanish) Layla.co gets the most action so far. So I say hold to your good single names and see what happens.

  12. Bram C.Feb 16, 2011 at 7:57 pm

    I actually only have one .CO name left (sold 8 of them already) but i'm hoping for a nice profit. I might submit it to the second Sedo .CO auction.
    The domain:
    Cutter.co –> 112,220 Exact Searches/Month.

  13. www.petforum.coJun 10, 2011 at 5:12 pm

    Amazing, there are still some decent single word .co domains you can get. Today i just hand registered Cosmotology.co. I was surprised nobody had it yet. Its not a “Great” name by some standards but still a pretty good one. I was driving down the road with my wife and heard a commercial on the radio having to do with cosmotology so i whipped out my blackberry and checked to see if the word was available. Sure enough it was. Sometimes if you hear something on the radio or TV and it stikes a cord you should always check to see if the domain is available. What do you think? Also i heard on the radio that they came out with a new swimsuit called the “solar bikini”. I guess the material absorbes sunlight and it has a USB thing embedded into it where you can charge your ipod while sun tanning on the beach. You don't have to worry about your battery dieing. Almost every variation of this in the domain world has been scarfed up. I think i was able to get the Last remaining domains in this area. I got solarswimsuit.com, solar-bikini.com, and solar-apparel.com. Practically everything else you can think of is taken. Yes, i paid around $33 for the three but since i collect a lot of dividends every month from my stocks its really nothing to me. IF this product ever becomes popular maybe just maybe i can make a few dollars. Domaining is FUN!

    Comments welcome!

    Eric
    petforum.co