But, I almost named this post:
GoDaddy’s huge conflict of interest
...for startups trying to buy their domain
Anyway, here's some contextual information before we dig into the wild wild west of acquring domain names.
I’ve been CEO of Handshakin.com for just over 4 years, and it’s my second year speaking at the domain name investor conference. Finally, in 2019 sales were at a point where it was time for us to grow up and to acquire our exact match .com: ‘handshaking.com’.
This would save our sales team time from having to explain it’s ‘Joe at handshaking dot com, without the g, let me spell that for you.’ With handshaking.com, they just need to enunciate the words clearly, and it’s a word that almost everyone can spell.
As a domain investor of almost a decade, I knew that finding the precise domain name that I needed was not going to be readily available. In fact, I had tracked the domain “handshaking.com” for years, but it’s ‘buy it now’ price of $12,000 was always out of budget. With the growth of my company, I felt like we were strong enough to start conversations.
I’m a Godaddy customer, domain investor, and Founder/CEO of Handshakin.com. When I found out that Handshaking.com was owned by “Name Find, LLC” it made me incredibly uncomfortable since Godaddy owns the Name Find portfolio. Were they going to quote me a higher price because they know how many versions of ‘handshakin’ I own? I’m the ultimate end user, and I wanted the domain name investor price, not the retail price.
Plus, I am a big GoDaddy customer and have been for many years. I even have hundreds of other domains that I was willing to transfer into GoDaddy to give them more business as a negotiating chip.
So here’s how the story went:
GoDaddy Appraisals said that handshaking.com was worth $3,148 even though they were asking $12,000. Yes, it sounds a little ridiculous, so maybe someone could explain that to me, or correct the price to be reflective of their own appraisal of it.
1/2019: Introduced myself to the GoDaddy team at NamesCon conference after I gave a speech.
Decision makers were not at the booth, but I got cards and they said they’d connect me with the right person to discuss buying the domain name.
2/2019: Tried to negotiate anonymously as a buyer
I called the number on the parked ad page on handshaking.com to anonymously offer $1,000 for the domain handshaking.com, they told me that they only could start a dialogue at half of the current asking price of $12,000, which would equal $6,000. I told them GoDaddy Appraisals valued it at $3,148; they told me it was not accurate.
2/27/2019: Tried to negotiate with a higher price as a broker
I called the number on handshaking.com, told them ‘my client’ wanted to offer $2,500. They didn’t want my contact information, and told me that my client needed to offer $7,800. I asked them for a counter, and they did not give me a price. They had increased the minimum offer to start a dialogue since my last phone call to them. Godaddy Appraisals remains half of their internal ‘minimum offer’ price. A little frustrating.
After a few months
I decided I was willing to spend several thousand instead of a few thousand, as long as I could understand that I’d be getting a good deal and I knew I needed to learn more (hopefully from the seller) on why this domain was worth so much.
Reached out to my premier services account rep
When you are a bigger GoDaddy customer you have a direct contact who can help you manage your domains when their domain manager is not working (very common for bigger portfolios like mine).
5/2019 I decided that I would ‘show my hand’ and tell my account rep, Theresa, that I needed help getting in contact with a broker. She couldn’t even help me get in contact with someone at GoDaddy who would even talk with me! I heard the same thing from her: You have to offer the minimum offer to begin negotiations ($7,800).
5/11/2019 Had a talk with one of my mentors in the domain investing space, Morgan Linton, who advised that I not take my anger out on godaddy and that the domain was worth $50-100k. That was comforting to hear and made me feel like I was making a smart investment, not overpaying a company I dislike for something that isn’t worth much to other domain investors.
So then I offered $7,000 on 5/11/19 but then immediately lowered my offer to $4,500. I was feeling a little impulsive. However, no changes, no responses, no appreciation from GoDaddy… still was not closer to making a deal happen.
No luck or help from my account rep, Theresa.
More time went by and I decided to offer the $7,800; I was willing to purchase it at that price after understanding with what value the domain comes. Does it have traffic coming to it? Does it have a high domain name authority or any other SEO value that I’m not aware of?
I believed that someone needed to sell me on it. As a purchase in the several thousand dollar range, it’s safe to expect a sales call, right?
GODADDY ACCEPTS MY PROSPECTIVE OFFER OF $7,800. But still no one has any reason or explanation on why the price is still more than double their own appraisal.
Godaddy, you’re ripping me off.
I had previously texted one of my closest friends from college who actually got me into domain investing. He was planning to introduce me to Joe Styler, a broker with whom he claimed to have a good relationship. He said that Joe was the one guy at GoDaddy who could help me purchase this domain at a fair price.
However, I was not introduced to the promising connection in the 24 hour timeframe that GoDaddy had put me on to accept the $7,800 offer or not. GoDaddy said that they would move forward with other buyers if I didn’t move forward within 24 hours. I still did not have any meaningful conversations, although I had been in contact by phone with my account rep and a broker who really had no reasons at all to explain to me why the domain was worth $7,800.
“I couldn’t imagine buying a domain from them as a regular business owner without knowledge about domain name investing. It would feel incredibly unfair and shady and would likely turn out to be a nightmare.”
You can get a flavor of the level of stress I was feeling at this point. I even went to email the CEO of GoDaddy emphasizing that I was a big customer, their appraisal was $3,100, and I wanted to buy it for 150% their appraisal price. I never heard back; the email was just forwarded back to the folks that didn’t have any ability to change anything. Lame.
Anyway, here are my texts with my college buddy (exchanged while I was in the middle of getting ripped off or losing my exact match domain name):
Emailing the CEO didn’t help at all.
My friend’s contact Joe Styler didn’t have anything helpful to say.
As of 5/14/19 , I was asking them to accept my $4,500 offer which is a counter to their current offer of $7,800. However, they never had any explanations as to why it was worth that much more than their own appraisal. They came down from $12,000, for which I’m very thankful, but even if you take the difference of $7,800 and $4,500 you get less than 3% of the money I have already paid to GoDaddy as a customer.
One would think they would take that small number into account to help one of their big customers. NOPE.
Don’t forget that THEY appraise it at $3,100 and I’m offering 150% higher than that.
Additionally, as a premier customer, it was close to impossible to get in contact with the decision maker. I was really upset, stressed, and frustrated.
On 5/14/19, I checked the email I sent to the CEO four days ago and saw that it was viewed 14 times.
They also highlighted that they had other buyers that may buy it this weekend, but I was trying to not let that stress me out since another confidential source of mine had told me how many offers they have had on the domain recently. It’s not that high.
5/19/2019 I have not budged from my offer of $4,500, nor have they let me talk with anyone who has told me why it’s worth $7,800. My plan right at this point was to hope no one buys it, and then cough up the full price they were asking and terminate my entire relationship with them due to awful customer support, their handling of their conflict of interest, and a broken domain manager that makes bulk domain management a task that takes longer than it does on other platforms. Peace Godaddy. You’re welcome for the extra few grand you’re getting out of me.
5/20/2019 I have consulted with legal counsel. Now I’m worried that if I threaten this huge corporation that they will raise the price or refuse to sell it to me, despite the fact that I may have a claim due to our intellectual property, and the fact that:
Godaddy acquired the domain handshaking.com after I registered handshakin.com as their customer. If that doesn’t break your trust with GoDaddy as a company, I’m not sure what will.
I am leaning towards buying it for $7,800 which felt really upsetting. I was already moving decent chunks of my portfolio to another registrar in the meantime in hopes that will. Their domain manager is so slow for bulk updates. I unlocked my domains to transfer them but then it later turns out that they were not unlocked.
After talking with two attorneys that are friends of mine, I began learning tons of things about Godaddy’s incredibly shady legal history. I invest in domain names because they are assets, and it’s also the wild wild west since domains are a new asset class (less than a century old, contrary to real estate assets). I’ve always enjoyed the upper hand when I own a domain that someone else wants, regardless of their threats, but I have sold plenty of domain names far below market value if I can still net a profit. Conversely, Godaddy is straight up stubborn, unresponsive, all while they have enjoyed tens of thousands of sales from me. Frustrating.
In this video they said they acquire portfolios of domain names to ‘help’ small business owners. However, I have direct experience that that is simply untrue and they are taking advantage of small business owners, by charging multiple times higher than what they appraise it at. All while they already can see what domains you already own with them.
Be careful before you buy a domain like johnsconcrete.net for your business, because nothing is stopping Godaddy from acquiring johnsconcrete.com from whoever owns it, to later sell it to you for more than even they appraise it.
5/23 I bought the domain for $7800 + one year of renewal. I was terrified, upset, and was anxious to cut my non profitable relationship with GoDaddy. They ripped me off, despite being a big customer, and multiple times I had sold my domains at GoDaddy auctions and then they asked me to send the domain over before I received payment; but then they will not collect payment, and then also not give me the buyers info to enforce the contract.
I had to pay a premium price that I believe was more than it was worth. I’ll move on from this relationship and cut half of the $7,800 in the domain handshaking.com as a loss. Thanks for teaching me to place a higher priority on relationships and trust with our vendors GoDaddy! Hope you fix your broken domain manager with the extra you charged me.
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