If you’re just getting into the domain space it can be all too easy to think that flipping domains is an easy way to make money. You hear a story about someone buying a name for $2,000 and selling it for $20,000 and think, “if I just do that with one domain a month I’ll be set!” Ask anyone who flips domains and they’ll tell you that domain flipping is a lot of hard work and buying the right names and finding the right buyers is no easy task.
The problem is that there are far too many eBooks and blog posts that paint an all-too-pretty picture of domain flipping. This leads to some pretty serious “myths” around Domain Flipping that sadly leave many new investors disappointed. Below are some of the most common domain flipping myths I’ve heard, get these out of your head and you’ll be in a much better place:
Domain Flipping Myths
- You can easily hand-register domains and flip them to end-users for a huge profit – while you can flip hand-registered domains, many people do it for $100-$300 profit which means you’ll have to put in a lot of work to make anything meaningful. Also, the learning curve is steep so you will most likely be buying mostly names that you can’t flip at first meaning you’ll be spending your time doing something that costs money and doesn’t generate any revenue.
- Flipping Can Be Done Passively – sorry, flipping is an active process. If you think you can just buy domains, throw them on a listing service and watch them sell then you better be incredibly patient. Remember, a flip means a quick sale, waiting three years to close the deal is not a flip.
- If someone just bought a domain for big bucks, you can sell them a similar name – I can’t tell you how many times someone has told me, “I just bought this name for $x,xxx and I’m going to flip it to a guy who just bought a very similar name for $xx,xxx so I’ll make a huge profit!” Just because someone just shelled-out five or six-figures for a name doesn’t mean they’re willing to do it again for a similar name. Knowing what someone just bought might not be quite as useful as you might think, every person is different which means every domain sale is different.
- Domain Flipping can be learned in a few months – there’s this notion that Domain Flipping is something you can just pick-up in your spare time and generate meaningful revenue with in a few months. In many cases be prepared to spend a year or more cutting your teeth and learning the basics. You’ll make mistakes, lose deals, buy names that you can’t flip, and everything in between. If you’re looking for a get rich quick scheme, stay away from domain investing, there’s a real learning curve here that many people don’t like to talk about.
- All you need to do is make one big sale a month – sure, that sounds great, but it’s a myth thinking you can do this out of the gate. As I’ve said above, flipping domains is hard and every name is different. While it might seem like closing one big deal a month would be manageable, finding that one big deal is a massive challenge and could take months itself. The reality is that most domain flippers start-out by making a few hundred dollars a month in flips for 50+ hours of work which means you’re probably working for $2 – $4/hour for yourself to start.
I hope reading this list helps dispel some myths that some of you may have about Domain Flipping. If you are a domain flipper yourself and want to add some myths to the list, please add them to the comment section below! There are certainly more than five myths and the more of these we get out in the open, the better prepared new investors can be!