Patting yourself on the back can have adverse effects.

Earlier today, domain investor @tonynames posted a request to domainers on Twitter:


Tony is referring to a common practice of domain investors: mentioning how much they bought a domain for and how much they sold it for.

The problem with this is twofold.

First, it gives ammunition to people who hate “squatters”. You charged me $4,000 for something you bought for $40?! That’s crazy!

Second, it ignores the reality of domain investing for most domainers.  The unit economics are spectacular, but the overall economics are tough because you only sell a small portion of your portfolio each year.

Consider this response from @domain_org:


When someone tells me they sold $100,000 of domains last year, I often ask them what their carrying costs are. On top of that, how much did they spend on new acquisitions this year to keep the sales flowing? In other words, what’s their cash flow?

Anyone can build a portfolio that generates a lot of sales, but are they actually adding money to their bank account?

Join the conversation here.


Post link: Sharing your purchase price, but what about cash flow?

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