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Is a domain name worth $3,000?

7 points by MaxWendkos ↗ HN
Hey HN Community,

I have a dilemma and I figure that you guys/gals are the best people to turn to for advice.

Currently, I'm working on a very early stage startup. I own a domain name for it that I don't particularly like, but it was available on GoDaddy so the price was right. However, I just recently found a domain name that I love. I really think that I can build a great brand around this domain and I'd buy it right now... except for the fact that is costs $3,000.

I currently have $6,000 in the bank, so this will take half of my account, but I will be able to secure funding from friends and family in about two months and will have no problem covering the cost then.

What are your thoughts? How valuable is the domain and brand to a startup's success? Would you take the risk?

21 comments

[ 2.9 ms ] story [ 55.2 ms ] thread
philiphodgen
If you truly believe this is a critical branding element, do it. And don't cheap out -- trying to chisel for that last $200 of savings isn't worth it in the long run.

No one can tell you whether the branding is critical or not. From my perspective it is immediately obvious that the name puts you in a completely different state of mind about the project. That positive-outlook state of mind is probably worth $3,000.

Side note: I spent money on a vanity phone number for myself because it is amazing what a cool cell phone number does to being memorable in my clients' minds.

maxdemarzi
>I'm working on a very early stage startup. >How valuable is the domain and brand to a startup's success?

At your stage, it's worth ZERO. Worry about this later. Do not blow half your load on a domain name. From one Max to another, don't do it.

there
is it something generic? if the startup fails, could you sell the domain name and get a big chunk of that money back?
MaxWendkos
Yeah, the name is pretty generic and U believe that it will have a high resell value if things don't work out. However, that also depends on finding the right buyer...
FreshCode
No. Build a prototype first. Don't be like Color.
mindcrime
Where Color's problems caused by spending $350,000 to buy the color.com domain, or were they caused by either A. having a lousy idea to begin with, and/or B. failing to execute their plan?

And besides, it's a pretty big hop from $3,000 to $350,000.

decadentcactus
Are you also sure it's worth a firm $3k? Perhaps you could negotiate it down a bit.
opendomain
I have bought many domains and $3k is cheap for a brand you love. However if you have only 6000, it is too much. I have started my open source project OpenDomain that lets people use domains for FREE (Drupal.com and OsCon.com) contact me domains at OpenDomain dot org.
MaxWendkos
Thank you for the resource! I'll check it out.

One thing I'd like to reemphasize is that, although I only have $6,000 in the bank, the friends and family round is a lock for a minimum of $50,000. Does that change your answer?

michaelpinto
Imagine if Flickr blew most of their seed money on Flicker.com and then failed because they couldn't execute their idea?

My advice: Why not just hire a good copyrighter to generate a list of 100 domain names? That can't cost too much money (under a $1000) and you can then rank the list and see what's available.

joshuahays
Build a prototype first under a dev name, ours was 'Festy' until we unveiled the name. If it's a Premium Domain for $3,000+ on GoDaddy, it won't likely sell anytime soon. But, even if it did, it isn't the end of the world.

Wait until you have the 50k in the bank. And even then, think twice about that investment.

In short, prototype first.

whichdan
Don't buy it on the assumption that you can get funding or resell the domain. Do you currently have an income? How long could you live for if you lost your job? Do you have a business plan / code / design for your product? Have you discussed the domain name with a few other people?

$3,000 isn't a lot of money for a domain, but it is when you don't have the money :)

diolpah
We paid hundreds of times more for our domain names than this, and we are glad we did.

It depends on your market, though. And it should be noted that we started out with a medicore domain name.

brudgers
Given that you are severely undercapitalized, cutting your runway in half for a domain name makes no sense. Particularly since there will be plenty of domain names for sale in 3, 6, or 12 months when you are ready to bring the product to market - or have angel funding.

There is no point in spending money on something today which you don't need and may not need...Pivots happen.

Good luck.

thewordpainter
^great advice. there's a good chance the business will morph with time so i wouldn't drop anywhere near that kind of money until you've started making money with a product.

actually wrote a quick blog post about this subject as we were battling the issue recently: http://adamwexler.wordpress.com/2011/06/29/why-does-naming-a... it's a bitch-and-a-half to find a great URL these days, but try not to let it get in your way.

daimyoyo
My advice would be to try and come up with a name that's not registered. You don't want to lock up half your capital speculating on a domain, when you can spend a weekend brainstorming to come up with a domain you'll be happy with. Also, remember that the domain won't be unavailable forever if you should miss it this time around. It might come available again if and or when you get funded.
MattBearman
NO!

I think these days all domains are over valued, how often do people type a url into a browser these days? And how often do they just 'google' it?

Consider color.com, they spent a huge amount of money on that domain, and it hasn't helped them one bit.

</rant>

Best of luck with the start up :)