Valuation
Methodology
To value a domain name, a business can compare the
following three sources of value creation.
The figures below are only for illustrative purposes:
- profit from buying
an already registered and active domain name, e.g.,
for $25,000. Since the site is already active and
developed, there exists a pool of surfers in the
world who periodically go to this site;
- creating their own
domain name for $70 in registrar fees, and spending,
e.g., $25,000 in advertising;
- buying an inactive
domain name being held for investment purposes, e.g.,
for $5,000, and then spending $15,000 for advertising.
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