How to Acquire a Domain Name (That Someone Already Owns)
Background: We created Domainr almost four years ago, and since then many people have contacted us asking how to buy domain names that other people already own. We’ve not yet been through that process ourselves, so we asked our friend Julian Shapiro, founder of NameLayer, to write a guest post describing how it works — here’s Julian’s advice:
1) Direct Contact
If there are no contact details on the domain’s site, perform a WHOIS lookup using DomainTools.com. You’ll either be presented with the domain owner’s contact information, or you’ll be stone-walled by a “Privacy Protection” service. If the former, contact the owner using the fantastic advice recounted in the first comment on this blog post by Fred Wilson. If the latter, you can pay for a Whois History report at DomainTools, which will give you all the WHOIS records DomainTools has stored for the domain in question. Your goal is to find a point in time where the domain’s owner had not yet set up Privacy Protection, and therefore momentarily had his or her contact details publicized to some extent. You can then proceed to contact the owner, using the guidance from Fred’s blog post.
Pros
- Direct contact means you can offer a non-standard payment. For example, if you get the owner’s email address through WHOIS, you can search for their email on Facebook, read their profile details, and get a sense for who they are and how you can appeal to them. (If it’s someone in the tech industry, you might offer shares in your company like Mint did or advertise their name in the footer of your site like Firefox did in the early days.)
- You can bypass the major aftermarkets (Sedo and Afternic). When you’ve come close to finalizing a price with the owner, mention using Escrow.com instead. Sedo and Afternic charge around 20%, while Escrow’s fees are much more reasonable. (Escrow.com is what NameLayer uses for all its $2,000+ sales, and we’ve never had any issues with them.) This way the owner will ultimately keep so much more of the sale price, that it’s as if they’re being paid an extra 15% on top of the offer. It also hides the final sale price from public records, which for some people is incredibly important. Although Sedo (the largest domain aftermarket) might give you the option to hide the sale price, they’ll charge you to do it. Ultimately, using Escrow.com is a huge win that might tip the owner in favor of your lower offer.
Cons
- If it’s a domain that receives a lot of offers, your email may just get lost in the noise. If you’re worried about your email going unnoticed, then consider using a brokerage service (discussed below), which will make your inquiry stand out. Brokerage programs require that the acquirer pay up-front fees, and brokers handle the transferring and escrow processes. It’s a huge bonus for the domain owner and they’ll consequently pay more attention to brokerage emails.
2) Brokerages
Use DomainTools.com to do a WHOIS lookup — it’ll tell you which registrar the domain is using. Visit that registrar’s website and search for their “Brokerage/Buy/Offer” service. The trick here is to always use the brokerage service of the registrar with which the domain is registered — this way the registrar knows how to contact the domain’s owner, even if the owner is using Privacy Protection. If for example you were to use GoDaddy’s service to contact the owner of a domain registered with Network Solutions (which has their own brokerage), GoDaddy might not be any more effective at getting in touch with owner than you yourself.
Pros
- See Cons in the previous section.
- The corresponding registrar actually knows the domain owner’s contact details.
- You hide your identity as the buyer. (Then again, you could also just create a random @yahoo or @gmail email address for the sake of making a Direct Contact.)
Cons
- You’ll pay a fee to use the service.
- The buyer will see your formal approach as a sign that you have money to spend. They’ll wind up haggling harder and you will pay more on average.
3) Legal Claim
If you believe you’re legally entitled to the ownership of a domain because it infringes on a trademark that you registered prior to the domain’s registration, or because they are misrepresenting themselves as you, or for a few other reasons, consider exploring the UDRP. Read through both of those links thoroughly before you proceed with this option, as it will cost you time, energy and money, and you might not win.
Pros
- You’ll pay nothing besides the UDRP fees in order to acquire the domain.
- If the UDRP decision ends in your favor, you’re almost guaranteed to acquire the domain.
Cons
- If the UDRP decision is not in your favor, the owner will have largely “proven” the validity of their ownership and will accordingly be stubborn when haggling with you for it, because they know that you won’t be able to easily fall back on legal action.
4) Aftermarket Bidding
If the domain in question is listed on Sedo or Afternic, then you can simply place a bid. The only advice I can offer here is to first inform yourself of the reality of domain name analysis, research past sales with similar keywords, and get a feel for the domain name aftermarket’s trends.
Pros
- All bids are contractually binding, so the owner is less likely to back out.
- The haggling process is systematized and straightforward.
- The aftermarket in question will handle the entire transaction process.
Cons
- You can’t offer non-standard payment.
- You can’t easily use the power of written persuasion to talk them down to a lower price.
Julian is the founder of NameLayer.com, a domain name portfolio for tech entrepreneurs. You can follow him at @Shapiro.
