Want evidence? Watch Wall Street during any given earnings season. Information flow is at its peak during the months in which most companies report quarterly earnings…and the market makes significant adjustments to stock prices during these months.

The domain name market is in its infancy for sure. Right now, it’s a nascent market that suffers from a dramatic lack of information flow. It’s basically the opposite of Wall Street - private deals with unreported sale prices are made all the time, valuation models aren’t widely distributed, and hard, reliable data on individual domain names is difficult to come by.

If the goal of all good domain investors is to create a stable and liquid market, then we should commit to letting information flow freely before someone comes in and makes it flow for us.

Technorati Tags: domain names, domain investing

Beyond the irony, the post offers a nice case study of the current domain name environment. Picking a domain is an important part of getting a new company or new project off the ground. The smart folks in the world pick smart domains, assign a value to the domain, and determine if they can buy it within the confines of their budget. This reality ensures that market prices for good and great domains will continue to increase.

Others take a different approach. They keep checking GoDaddy until they find one that’s available for registration. This strategy is guaranteed to produce a false sense of success and will yield a truly great domain in only limited circumstances (e.g., localized generics).

Technorati Tags: domain names