Domain leasing I feel will continue to be one of my main focuses this year while others tick over, I am either having more luck or business owners are more receptive to new ideas in challenging times, either way I feel after a year or so of working quietly I am beginning to reap some of the rewards.

The premise for domain leasing for me for the most part is to buy a good product based generic UK domain, build it out as much as can be justifiably done to get it indexed and possibly ranking and then offer it as a second storefront to existing businesses, show them the advantage of a generic, high recall & recognition value especially when advertising, easy to spell, niche dominance and market credibility as well as some traffic.

The first year was mostly working on getting some good domains and after a great early lease it’s been odd pickings here and there to finally end up at £775 per month in income at the end of last year for a business built literally from scratch. 

This year needs to be the year I take this side of my business up a notch, the basic strategy which I have detailed on the blog is sound and I’ve tested it out enough times to feel happy with the principle. I decided in January my goal for this year will be to get up close to around £2000 per month from leasing which will be a pretty decent sideline, you have to remember that if I get it up to £24k annual income by the end of this year then not only is it a business earning pretty much £24k net passively, it also has assets that amount to far more than that, the lease itself increases the value of the domain hugely.

I’ve been asked once or twice to list domains for others and lease out for others but that’s not on the cards just yet, for now I need to ensure I’m getting a decent payoff for investing the time & effort needed to see a domain through from purchase to lease and that means ignoring the £15-£45 per month price bracket. One of my better domains was leased out this week for £500 per month, it was 2 long months of waiting to conclude the deal but it’s done and I’m very happy to have it wrapped up, I’m happy to say that for the most part I’m still working on the general rule of trying to get my capital invested back in around 12 months on a lease of 2 years+

Already done some more research and bought 2 domains, one for £600 & one for £800 which I feel are good candidates for leasing out at around £100 per month and I feel I have the inventory here to push on. Like I mentioned earlier I have had good feedback in the last few weeks when approaching companies, one agreed to lease 3 domains for £360 – not sure if it will come off and I can’t include it until the paperwork is done, I’d really like to get a few done this year around £100-£200 as they would add up quickly, however for now the confirmed passive leasing income stands at £1275 per month.

Edit: I created a category for domain leasing which started with this post some time ago!

I have been asked a few times if I would list or lease other people’s domains, it’s not something I am particularly interested in at present, a pretty good example of why not happened this weekend and went like this:

I enquired about a nice one word UK domain, offered some money but the owner who had the domain since 1996 and ran a small unrelated business on it wanted £40,000. Far too rich for me but rather than walk away I decided to ask if he would consider letting me broker the domain for lease or sale as his asking price of £40k was not entirely unreasonable and I had a couple of people I felt I could hit up and offer the domain to.

So I needed to know 2 things
1/ What’s the lowest you would take for a sale, to which he replied £35k
2/ Would you consider a lease to buy, for example lease it for £400 per month with an option to buy built in for £40k thus enabling a buyer to build on it and buy once they got going, YES the owner replied.

I worked over the weekend sending emails and answering questions on this domain and yesterday agreed a deal with a pair of businessmen, they were happy to lease the domain on a 2 year lease for £500 per month with an option to buy for £50,000 written into the agreement. Pefectimondo I thought, this was much better than I had suggested and should surpass the owners expectations. Even though I would take 15% commission this would still give him £425 per month and a possible domain sale of £42,500

The domain owner agreed to phone me this afternoon and after thinking it over he decided that £500 per month probably wasn’t worth changing his stationery and moving his buiness, this completely contradicted his earlier conversation where he told me he was looking to sell the domain and had been actively moving all the important things away from the site over the last 12 months. So now the deal is dead and I’m pretty annoyed, it’s my own fault for acting in good faith and believing what I was told, I’m also going to look like a twat going back to the businessmen and telling them the deal I offered them is not going to happen.

I noticed a sudden rise in type in traffic on one of my domains last week, it had only just had a minisite put on it and suddenly had 100/150 visitors per day, checking analytics I confirmed these were actual type ins and not organic which just didn’t make sense.

Later that evening all became clear, a television advert was running for a new company that was not entirely dis-similar to my domain, traffic leakage. The problem being that the traffic was totally unrelated to my minisite and changing my content would mean I was trying to wrongly benefit from someone else’s business and trademark which could result in me losing the domain.

I decided to contact the company – just to inform them of the traffic leak and the lack of clarity in their adverts in relation to their domain name. To my surprise they were very excited to suggest I use a referral banner and were happy for me to send traffic on and pay me £2 per lead. Crazy! this company had a poor domain probably reg fee, I have the better clearer generic domain, they spend thousands on a TV advertising campaign which sends 150 visitors per day to me and then they pay £2 per lead for any of their visitors I send on through due to traffic leakage, effectively paying twice for the same traffic.

So I agreed The TV advertising campaign runs for the next 4 weeks after which I’ll get paid. The marketing department really should have seen this coming, my generic domain was caught for free a few months ago so with this stroke of luck I should be well in profit and have a healthy payment in a months time. Just shows how old and new companies still just don’t get it.

Maybe it’s scary, maybe it’s just poor book-keeping, maybe it shows I’m not on top of things however I still love it when that happens.

I use netvibes for a bunch of news/feeds, it offers inspiration and ideas at times, for example this morning I caught a Digg headline about having your genes analysed using the term ‘my genome’

I have a few gene related domains like genes.co.uk & genomics.co.uk but seeing it in that article the domainer/developer in me saw the beauty in the term ‘my genome’ and although I have spent more than I should have in the last 12 months I had to have a look at mygenome.co.uk as it sounded like a great domain for a business and to my surprise, I own it. Phew, I love it when that happens, I feel like I just saved myself a few quid  - looking back now it seems I bought it for £200 on the 1st January 2008. Personal genome sequencing just like led bulbs are future technologies that are just around the corner and a couple of years away from being mainstream, a good time to buy and develop, I think I should build out a few of the gene related domains and look into affiliate opportunities this year to capitalise on the groundwork I did last year in buying a few strategic domains.

Just before I sign off for the year I wanted to do a last kind of post on domaining, I’m still 100% happy with my strategy of securing prime keyword specific generic domain names for the purpose of building on. While it would have been nice to reg some domains 10 years ago my mind was on other things, this is still a period in time that won’t be repeated, I still feel we are here just now pretty much at the creation of the internet and there are opportunities today that won’t be here in a generations time.

There is a small element of ‘fear of missing out’ no question but that’s only a tiny part of what has driven me over the last 12 months, when things settle down over the next few years and they roll out other new extensions and add variety and choice I still have the gut feeling that it won’t dilute anything, perhaps the reverse. Country code domains like .co.uk and .com have been to the forefront for the last 10 years and the branding, trust and recognition by the public at large gives me confidence that domain names and especially the good one’s will continue to appreciate in the coming years.

The main thing that’s changed recently is the domainer to domainer sales at the bottom end has dried up, it seemed to be mainly fuelled by selling to each other based upon speculation anyway so moving forward I’ll jot down my golden rules for buying domains if you wanted to replicate what I have done. These are my own views and my strategy, it may differ for other people. (more…)

I think after 12 months I am pretty much done with buying domains, not in a negative way, just that I mainly sought a couple of niche areas to target and I’m about completed on my quest I think, I’ll dabble no doubt but it was always about getting assets to develop and build on while opportunity was there and not about greed or amassing them or trophies, I’m more than pleased with what I have secured in the last 12 months.

One niche was to buy to lease and I wanted to concentrate on furniture for that, the other niche was to buy to develop. My development domains are computer & electricals so TVs, PCs, PC Games and more recently notebooks.co.uk and netbooks.co.uk

Netbooks are a growing market, a big enough market for 2009 for me to be very interested in, the domain had some age and thankfully my first offer was immediately accepted and the domain transferred all within a few hours so no heroic tale of toil and determination, just a nice simple deal with two happy parties, I get the domain and the seller gets a wad of cash in time to buy some Xmas presents. I put amazon up there for now and actually sold 3 of them in the last week, shame Amazon cap electricals at £7 but it’s still £21 earned and better than a few Adsense clicks.

Only another £1979 still to earn back from that domain and I’m quits In a stroke of luck (which is always gratefully received) I received an email and entered dialogue with a company one week after buying it,  they were willing to pay £5000 plus VAT  - tempting though it is to make £3k that quick and in time for Christmas (and my bank could be doing with it right now) I have to play the long game and refuse, damn it!

Notebooks.co.uk is the other recent purchase however I had to be more creative and offer added value to secure it. I love those types of deals, the response went along the lines of

We would be willing to sell this domain for the right amount of money, I am not sure £2000 is the right kind of money for us to relinquish it though.

That’s a fair comment and you have to start somewhere, 2 emails and one telephone call later it was sold without me having to increase my offer, I gave some advertising on my sites so again both parties are happy. If 2008 was all about my land grab and about spending money to aquire some great foundations then 2009 really has to be about development of these and turning dormant domains well on their way towards micro businesses. I feel pretty happy to have bought the domains I have, while computers.co.uk or laptops.co.uk would be very nice they are well outside my budget so I’ll settle for their poorer cousins PCs.co.uk & Notebooks.co.uk and rest in the knowledge that I was relentless in 2008 to build a very small portfolio of domains at a time when some still protested all the best deals had been done.

Extending AdSense for domains to all publishers

Many publishers have approached us looking for a way to monetize their domains, and today, we’re excited to announce the expansion of AdSense for domains. This product allows publishers to earn revenue through ads placed on undeveloped domains.

The product will be initially rolled out in phases to English-language AdSense publishers located in North America, and we’ll expand to additional regions and languages in the future. To check whether AdSense for domains has been enabled for your account, log in and visit your AdSense Setup tab. 

Google have finally (In North America) opened up Adsense for domains, so domains with type in traffic that you don’t have a site for that were previously idle or at best parked can now be monetised through Adsense for domains. Being in the UK it’s not an option for me at present but when it’s rolled out I’ll be keen to give it a whirl.

http://www.google.com/domainpark/

For those of you keeping up with my domain leasing attempts I have 2 more leased out in the last couple of weeks, both @ £50 per month, one on a 2 year lease, the other on a 3 year lease, one domain was caught for £5 the other cost me £700. That takes the total to 5 domains leased out @ a total of £775 coming in per month.

Overall thoughts on buying domains to lease recently are pretty much unchanged:

1. Make sure the domain encompasses a whole or substantial part of a business, it has to be attractive to an end user to build a second store front on, don’t try to get into too small a niche.

2. Make sure the niche you choose has a lot of players or potential end users, your going to need a big audience to find the right person with vision, I sent out around 30 emails last week and in one reply where I was asking for £75 per month the reply stated he would buy it for £75! When speaking on the phone to another potential end user he was shocked the domain I was trying to lease cost me over £1000, those are hurdles that still need to be tackled.

3. Again if there is a fee paid for the domain which is usually the case with good domains I try and get that back or most of it back within 12 months and therefore look to lease out for 2 or 3 years.

4. The domain needs to be ranked for it’s name, of the 5 leased out, only one was not ranking top 10 for it’s name, it’s that added value that helps make a deal just now.

That’s probably all the progress I’ll make with that side of my business this year, next year I need to crank it up and I have a lot in the pot that I have been working on all year quietly so I really want to aim to take it above £1k a month and towards £2k a month. it’s certainly not get rich quick but once the time & effort is invested if I have 10-20 valuable domains leased out in the future making an income of 4 figures a month it would make that side of my business pretty valuable considering the investment would have paid itself back within 12 months, that business would be valued on a multiple of it’s income and the fact that the capital assets appreciate in value each year. It may be an option to sell the busines as a going concern one day or just live of the income.

Recap/timeline on the last year for domain leasing.

• It was August last year I made my first post where I considered the idea: Become an internet landlord
• 2 months later in October I had my first domain leased out
• In January 2008 I put in my to do list for the year “I would like to progress with leasing a bit more so would look to have at least 2 domains or sites leased out on long leases to expand on what I have started there and prove to myself it can grow.” 
• I knew ranking and buidling some value into the domains would take time and hamper progress in 2008 so it was nice in May to lease out my second domain.
• After leasing out the second one it really opened my eyes to the added value this gives a good domain.
• It would be November before my 3rd, 4th & 5th lease would come, no surprise, I expected a year of buying and working on them before I could get down to realising them as assets.

All in all from a standing start around a year ago to get to £775 per month is fair enough, the first year is certainly the hardest and next year should offer more opportunities with more money being spent advertising online. Almost all my domain buying has been done in the last 12 months – it’s been a big shift for me but I think the fact that I have detailed a great deal of it on this blog shows it’s certainly not too late for anyone, there is opportunity if you have motivation.

Completed the purchase of PCGames.co.uk yesterday for £3500. No small amount but overall I am very happy with the deal and the purchase, it was done through sedo as the seller for some reason wouldn’t talk directly, still if they want to pay 10% to sedo fair enough. It obviously sits well with PC’s. Gaming is massive, I had looked at videogames as a domain but quite rightly the seller of that wanted £50k – there was a possibility of talking about a joint venture or lease to buy but it was always going to be a very expensive domain that I didn’t own outright.

PC games is a much smaller market than videogames but with that the price comes down a lot as well and as I said it ties in with PCs beautifully. Why pc games? Well for me I view the gaming industry as one (from a consumer level) that won’t suffer as much through the recession and will fare well in the coming months and years. I don’t know the numbers but while Woolworths & MFI go into administration I am pretty sure that Call of Duty 5 still broke records and sold very very well. It’s not that people don’t buy music, games and household goods, it’s just that they don’t go to Woolies anymore to do it.

Games are outselling music for the first time and with broadband uptake at around 60% it offers for the first time a solution to pc piracy that had long since plagued developers, anyone with a machine that’s good enough to play the latest games will have an internet connection and that means the copy of the game could be validated against a central server cutting out the ease of piracy that has hampered the pc gaming industry. Gaming will always be bigger on consoles but the pc market is a big enough to make this a great investment if I can execute it’s development properly, which I’ll get round to as soon as I can complete COD World at War

250 times the processing power of a traditional dektop pc the personal supercomputer may not be the work of fiction. With 4Tflops of floating-point maths these are designed for research and science more than gamers at present and at a snip under $10k you won’t be playing Crysis on one anytime soon.

Typically when I read articles or press releases like this is checking the whois and finding the obvious domains were register years and years ago.

However personalsupercomputers.co.uk was free to reg today and just in case anyone else is interested in such domains/technology there are some possibly decent domains with potential still available.

personalsupercomputers.org
personalsupercomputers.net
personalsupercomputer.net