On Sahar’s Blog today, Sean Stafford writes about how DNZoom came about and how the company is helping domain owners manage their portfolios. Sean discusses how his desire to build a management system for his own domain names led to the creation of an application that can now be used by other professionals in the industry.

DNZoom is now a part of the Bido portfolio, and Sean is at the forefront of the domain industry. Read the full article on Sahar’s Blog.

While I think domain parking is a great option for domain names that haven’t been developed yet, I believe domain owners should begin making plans to develop their domain names soon. I wrote a guest post on Sahar’s Conceptualist Blog about why I think now is the time domain owners should develop their domain names.

Please check out my guest post when you have a few moments.

Congrats to Sahar and team on the launch of Assista, the website he and Jeff Bhavnanie has been working on for a few years. The premise of Assista is that it helps you learn about a particular subject by tapping into other people’s questions. For example, I am currently researching Lowell, Massachusetts for my Lowell.com project. When I typed in “Lowell,” I saw questions that people had related to the city and to other Lowell-related topics (like Mike Lowell).

Overall, I think this is a fresh approach that will become popular, as it can help searchers expand the breadth of their initial search. While looking for one thing about a topic, many other questions can be seen, which could spawn new ideas and thoughts that may never have been had by the searcher.

Sahar and team has an aggressive goal of becoming one of the top 10 search sites in the next 18 months, and one of the top five in the next 3 years. These are lofty goals, but with the brains behind the project, it could be feasible. Here are a couple of suggestions I have:

1) As much as looks aren’t everything, the site doesn’t look great. I know this isn’t a major concern of Sahar’s at this point, but I think that will be key to going mainstream.

2) Speed is essential. While the results aren’t slow, they need to speed up. This will come in time.

3) It might be better if they frame the results from the “same window” page, that way the person can easily return to their results. For example, when the person clicks on “same window” for one of the results, they are taken to that site, but the Assista logo remains on the top of the page, so the person can return. I lack the tech knowledge/terminology - sorry.

4) When I got the results for a “Red Sox” search, it returned: 7336 questions / 267 exact matches / 7069 partial matches. There was no difference between 7336 questions / 267 exact matches. When I clicked both of those links, the same results showed up.

5) When I searched for something very specific, I didn’t receive any results. I searched, “Does salt increase cholesterol?” The search produced no results, but disappointingly, it didn’t make any alternate suggestions either.

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Overall, I really like the concept quite a bit. I like how I can get a popup window to show me a preview of the results page. I think this is going to get pretty big!

Reading Sahar’s post this morning has me also wondering what people have in place as an “out strategy.” What if domain values suddenly dropped (due to a number of possible factors), and the value of undeveloped domain names suddenly plummeted? I can’t even imagine this happening on one and two word category killer .com domain names, but this is something to think about for people whose portfolios may be made up of decent, but not killer domain names.

As with any market crash, panicking will only make things worse. I would advise against rushed selling just because the perceived value has decreased. The domain market is always in somewhat of a state of flux because there is no completely accurate price guide.

Here are five recommendations I would make while you evaluate your portfolio (which is always a good thing at this time of year)
1. Cash in hand is very important - (you can’t pay your taxes with domain inventory)
2. Have a development plan for each name you own. If PPC advertising drops, you will be more protected
3. Trim down your portfolio ($8/year x # of names is expensive).
4. Drop names that realistically have no chance of making money unless someone random wants the name to start a business. A few names at $8/year is nothing major, but if you have 500 or 5,000 this is a huge sunk cost.
5. Make less speculative purchases. Just because Brittney’s sister is pregnant, doesn’t mean you need to try to guess the name of the baby and buy 100 .com names.

As an aside, if you are concerned about this and want to cash out of your one word category killer .com names, drop me a note

When Sahar writes, I generally listen. This morning, Sahar made some predictions for 2008, and the following predictions worry me a bit:

“1. Top prices will drop: As the top of the domain market is driven by a handful of buyers (Frank Schilling, Kevin Ham and Co., Anything.com), I see those coming to the conclusion they either have enough to develop or have better returns elsewhere, therefore stop paying top dollars.”

“5. Top portfolio owners to diversify away from domains, investing in other technologies (Search technoligies, others), services ( arbitrage, others).”

Sahar has a great feel for the domain name market, better than most, so when he makes a prediction like this, I would take some time to evaluate your holdings.

I’ve noticed that many of the mid-level to highest-priced domain auction acquisitions end up in the portfolios of the big players. They control quite a bit of the money that is invested in domain names. If one or more of these companies drop out of the bidding at domain auctions, we could see what would appear to be a market correction. Of course, another company could come in and fill the void, but it would take a whole lot of financial power to do that.

Regarding the prediction below, I know that Owen Frager has also been saying something to this affect for a while:

“4. Top portfolio owners to collaborate more with marketers outside the domain space (such as Scott Day/Seth Godin The “ever” project), SEO folks.“

This is a smart approach to domain development. If you look at some of Scott Day’s domain names (like Chairs.com as an example), you wouldn’t know that each wasn’t a full business. Not only does Scott seem to have one of the nicest portfolios assembled, he also has one of the smartest development strategies.

At this time of year, it’s always good to evaluate your portfolio and make changes if necessary. It’s smart to have a diversified portfolio in case there is any type of domain market correction. When it comes to domain names, content is king (for monetization and protection), so now is the time to consider your development strategy.

As some of you know, Sahar has been holding a popular logo contest over at Sitepoint. This contest has become huge, as Sahar has offered $2,500 for the winning logo, and is even offering $1,250 to the person that refers the winning artist to the contest. There is now a YouTube flash video marketing the event. Some of those logos are damn good. Nice idea to add the viral P2P and YT elements:

The domain name Vista.com and the VISTA trademarks were sold by Innuity for $1.25 million. You can read the press release covering the sale here.

Sahar also has some commentary about the sale here. I think Vista.com is a fantastic generic domain name. It illustrates the topic of “domain usage.” Regardless of whether a huge company owns a trademark for the word, someone else can own it as long as the content doesn’t infringe on the other trademark.

Sahar Sarid is more than just a domain investor, business developer and industry blogger, he is also a great teacher. Recall Media Group, the company he founded, is a leader in web development with projects including FuneralHomes.com, Flowchart.com and Assista.com. Under Sahar’s leadership, the company has grown and thrived, and it now dominates in the funeral vertical.

Sahar is a pioneer in the direct navigation business and a highly esteemed domain industry expert. He offers industry news, advice, and case studies on his frequently updated and highly touted blog, Conceptualist.com. Sahar’s vision of creating technology platforms that are scalable into multiple verticals is the foundation of Recall Media Group’s mission.

Sahar has an extremely diverse background that includes Military Service (Israeli Army), Retail Marketing, Professional Athletics (Rollerblading) and of course, Internet Technology and E-commerce. Sahar feels strongly that by cultivating a “desire for knowledge” and thus fostering advanced analytical and questioning skills in our youth, future generations will be better educated and more tolerant. His belief is that this will inherently create a fundamental shift in our socio-economic, cultural and political paradigms, culminating in a healthier, more peaceful, and ultimately a more sustainable global society/community.

In May, DNJournal published a great profile of Sahar, and I think his story is inspiring.

1.) EJS: What are some of the growth challenges you and your company face, and what are you doing to overcome these challenges?

SS: “Figuring out what works is most challenging. You first come up with an idea, it all sounds too good to be true, you are hyped, energized. You then put a business plan together, test the feasibility, and if all clicks, go build the product. Once built, you release your product just to find out your plan & model do not work. This is more common then you can imagine. Now you have a problem which is to figure out which part of your new venture doesn’t work? Sounds simple, but because *everything* is new, it is hard to figure out what is broken, and sometimes it is a combination of things, which makes it twice as hard. Is it the sales pitch? Is it the site design? Is it the industry? Is it the sales team? The list goes on and on. What we do is stay persistent, stay true to our core values, and march forward. We get into new ventures knowing very well that once the venture goes live, sometimes after years in development, it is the very beginning, not the end.”

2.) EJS: In an article comparing today’s Internet market with pre-bubble 1999, Aaron Kessler of Piper Jaffray said, Internet companies “are buying users instead of revenue and profitability.” How does your company convert eyeballs into dollars?

SS: “For us it is all about the bottom line. We are big believers in direct navigation and targeted search whereby our advertisers benefit the most, therefore we convert on behalf of our advertisers those eyeballs into dollars.

We do not believe in the idea that eyeballs without revenues is a good position to be in. We strive for profitability on our own, without the *need* to sell the company nor the need to take outside funding. For that, profitability is a must. As far as conversions, we always do things with scalability in mind. We try many different concepts and fail at most, but when we do get one idea right, since scalability is built in from beginning, it is a home-run that covers all our failures and then some.”

3.) EJS: In 5 years, when someone hears the name Recall Media Group and Sahar Sarid, what do you want to be the first thing that pops into their head?

SS: “I would like the world to know Recall Media Group for its integrity and persistence. We care about our people, we care about our partners. As for my name, Sahar Sarid, I’m working on building Assista which is a very important project in my life. I would love to be known for that project.”

4.) EJS: What skill do you think is more important - a strong business acumen, web development expertise, database programming or graphic design? Is it better to work to improve your weaker areas or hire people who are experts?

SS: “Common sense, good values, your reputation. If you get those together rest is easy. Web development (design, programming) is a commodity nowadays that can be sourced to professionals at very reasonable cost. Business acumen is important but not as important as basic fundamentals of life. At Recall Media Group a lot of times we compare business models to real life scenarios. If we have a good match we know we are onto something. If we don’t, we know something isn’t right.”

5.) EJS: Do you think your Israeli background and upbringing has contributed to your success, and if so, in what ways?

SS: “I think it helps. Israelis, Jews, are raised mentally, as the underdogs. We are taught all our early lives, through the bible, our history, that we were not likable, even hated. We are taught that if we want something we should do something about it, not wait for things to happen - make things happen. I grew up with that sort of mentality, being the underdog. Today, if I see someone who has something I want, in my mind, I believe that person is living “my dream”, “my life”. For me, that is unacceptable, that isn’t right, and it is something I must do something about, right now.”

***BONUS QUESTIONS!!***

6.) EJS: Other than your funeral-related names and developed sites Assista.com and Flowchart.com, what are your top domain names, and how do you intend to develop them?

SS: “We have tens of thousands of domains, some good, some aren’t. I don’t tend to elaborate on our corporate ownership until the day we develop. What I’m finding out is if we start a business in a certain niche we tend to want to control that niche and build supporting businesses and offerings with that industry. I think it is safe to say that you will see more Assista related projects, more Flowchart related projects, more funeral related projects, more domain related projects, and more directory related projects”

7.) EJS: You don’t seem to be a person driven by making lots of money. What is your favorite part of the business, and what motivates you?

SS: “In business, I’m motivated by competition. I don’t believe anyone is better than me. I believe if someone can do something, I can do it better. As for favorite part of the business, I would say seeing persistence pays
off, winning “against the odds”.

In my own life, I’m motivated by teaching, helping others. I’ve been a “natural teacher” all my life, since childhood. Everything I was involved with I thought others. Teaching and helping others help me understand fundamentals better. True mastery, in my humble opinion of course, is to see others taking your teachings and succeeding. In the domain space, few I taught/helped became self-made millionaires. For me, that is priceless.”

8.) EJS: You recently announced that “Recall Media Group is working on our first (of many) domain related ventures.” Are you able to divulge more information about the project?

SS: “No :)”

A great post on Sahar’s Blog this morning comparing the opportunity in Fort Lauderdale real estate to the opportunity in domain names.

“One of the interesting facts I picked up on is the land on Millionaire’s row (which now is being refered to as “Billionaire’s row” due to cheaper money) was given away for free back in the 20’s. The first thought of course is how people overlooked this great opportunity back then? Then the second thought took me back to 1994, when Network Solutions was still giving away any domain you wanted for free, if you just asked for it. Can you imagine? You could have picked up million dollar names only 13 years ago, as many as you wanted (could have structured within different companies at ease) as long as you asked for it.” – Source: The Conceptualist

Read the rest of Sahar’s post here.

Sahar’s post and a thread on Rick Schwartz’ Targeted Traffic Forum got me thinking about what advice I would give to someone looking to enter the domain investment business. Since I have a couple of friends who recently started out in this business as a hobby, I have a few pieces of advice that I shared with them and will publicly share.

1.) NEVER ever register domain names with famous or somewhat famous trademarks (or trademark typos). Either you will get burned or live in fear if you buy them. Not to mention that the money producing ones are registered (mostly by keyword scripts), so it would be a waste. Additionally, stay away from domain names of athletes, celebrities, politicians…etc.

2.) Read as much information about domain names and the industry as possible. It takes a gut feel to be able to do well in this business without spending a fortune on new registrations. You may end up wasting alot of time and money registering domain names that have no meaning or value to anyone but you. I have a list of valuable domain resources in my blogroll, and you can go from there.

3.) Get a feel of what’s selling in DNJournal’s weekly sales list. See previous sales prices on DNSalePrice.com. Check out what’s closing on Sedo and Afternic as it is more likely that a rookie will have access to names that don’t make DNJournal’s sales list. It might be wise to focus on a particular niche at first (like LLL.com names or financial names for example). Try to find unregistered domain names that are similar to ones that have sold.

4.) Sign up for one of the public domain forums and read as much as you can. I believe DNForum.com offers the widest variety of information, but DomainState.com and NamePros.com are also great.

5.) Always be honest in your business dealings. Although most business is done online in the cyber world, almost everything is traceable. No matter how many online personas you may create, you will be known for what you post and how you post it. If you are dishonest, it will probably haunt you, so don’t start off on the wrong foot. There is no such thing as “easy money.”

6.) Ask some of the more seasoned domain investors for advice. I’ve met many people who have been successful in this business, and most are very willing to give out advice. Alot of people spend hours in front of their computers focusing on various projects, and human interaction is greatly appreciated. Personally, I like speaking about domain names, and it’s great to see new people in this business finding success.

7.) Read the news, popular blogs, trade journals…etc to find and become knowledgeable about current events and new trends.  Buy non-trademarked names related to those trends you spot.  Never try to capitalize on a tragedy or other event no matter how much money you can make in a short period of time, unless you intend to build a “real” memorial site. Think of it this way, would you want a New York Times headline to read: “Cybersquatter John Doe Takes Advantage of Families of XXXXXXXXX Tragedy?”

8.) Don’t spend thousands of dollars on a single name until you have a plan that does not solely rely on ppc monetization.  It is likely that the seller isn’t selling a high earning ppc name for less than market value, so it will be difficult to find a deal.  Also, don’t buy an expensive name until you have the resources already aligned to implement your plan.  As Darren Cleveland mentioned in this post, development is difficult, can be expensive, and can be time consuming.  Unless you need to act immediately, hold off on buying high value names.

9.) Do your due diligence when buying a name in the aftermarket.  As I said in this post, you should do a Whois history check, call previous owners and search the forums/boards for any issues.  If you buy a stolen domain you may lose your money and the domain name.  Aftermarket sites like Sedo are not immune from domain thieves.  You should also use an escrow service like Moniker or Escrow.com for higher value transactions.

10.). Keep good records of your domain portfolio, sales, expenses and contacts.  Use the contacts as leads for other domain names or even for open discussion.  Track your domain names as you would track stocks in your investment portfolio.  Always be honest on your taxes because the penalties could be much more than what you would gain.

Domain investing is a great hobby or profession for many people. I believe it is still the “wild west,” and as such, special precautions need to be taken when going into this business. If something seems too good to be true, it really probably is. Trust your gut, and if you need help, feel free to ask.