Not Only Is the Article Written by Deborah L. Jacobs at Forbes Wrong In My Opinion, It Shows How Financially Naive She Is

Nov 22 2013

In my opinion, today’s article at Forbes was another example of someone looking in, writing from afar, judging an industry on a single event or personal opinion. Deborah Jacobs spent hours “researching” an article for Forbes about domain names.  She talks to a few people including Rich Schwartz and Mark Ostrofsky (who didn’t seem to enamored with the auction either)  and comes up with an opinion.  The opinion is that domain owners are squatters and that domain names have lost their glitter. She bases the entire story on the “data” that high end domains don’t sell for as much as they did a few years ago.  And the example she uses?  It sold for $300,000 years ago but it’s at $50,000 now.  So let me get this straight, a form of media that is slowly fading out is losing value as a domain as well?  In the comments of the article I asked her if the paper industry was in dire straights because telegraph paper sales have taken a tumble over the last 75 years. In short, she couldn’t be more wrong.

Adam Strong posted what I already knew.  He is having the best year he’s ever had.  And he was in this industry back in the “good old days”.  I know for fact that Andrew Rosener is having an incredible year.  I personally did six figures last year and I do this as a hobby.  Godaddy, Namejet, and Flippa are doing millions a week in sales.  This industry is solid.  Solid enough for thousands of businesses to make a living off of it.  Yes this industry is evolving but what industry doesn’t.  Buggy whip makers had to start making brake pads but they never left the transportation business.

As for the word squatter.  I’m used to it.  I don’t even bother to use the land example. Let them know I own a piece of land that is empty and there are houses all around.  When I bought it there were no other houses.  I imagine that someone else would like to build a house on my property for the amount I paid for it but I want triple now.  I guess I’m squatting there too.  I admit that when I tell people that I invest in domain names many of them think I’m in porn.  I also admit that I while I highly respect Rick Schwartz and all that he’s accomplished, he may not be the best posterboy for the industry.  He is what everyone thinks we are. A guy in dark sunglasses, looking tough. A previous salesman and someone that got rich in porn.  We know him better. As a kindhearted, family loving, passionate about what he does kind of guy.  But the package is a bit intimidating to the outside world. We all have different personalities and depending on which domainer you interview, you will get a completely different perspective on the industry. But put simply, we are still investors that buy an asset and then try and sell it for more than we paid. And we would be buying and selling used banana peels and old Miracle Whip containers if the market was strong enough.  We’ve all come from an entrepreneurial background. We do it because we have a great present and a potentially great future.  Most of us are not trying to dig ourselves out of a hole as the author implies.  It’s actually the opposite, almost everyone I know have been reinvesting profits and haven’t had to bring in outside money for years.

In summary, once again we have another naive article written by someone that sees all the money but can’t figure out how to get a piece of it so she calls it Fool’s Gold.   It’s like going down to the stock market and only talking to the half that made the bad trades. She had an opportunity to focus on the positive but chose to go the negative route because she doesn’t understand domains well enough to know why anyone would pay so much for a marker on the Internet.   She says some purses cost more than many of the domains from the auction and somehow I think she would feel more comfortable with that purchase.  And that says it all.

PS:  She has since taken down the “Squatter” reference to Rick.  Wise legal move.  You can tell she is a lawyer

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Outsmarting the Dumb, Outworking the Smart

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  1. Rick Schwartz

    I wrestled hard with the picture to use.
    I would like to be Mr. Nice guy. But the fact is I have to protect the chicken coop from the predators out there and after 18 years, I learned I MUST be a bigger prick than the predator is. And I am. By a wide margin.

    Not because I want to be. But because that is what it takes to protect my portfolio and many others. You can’t be a nice guy when the #1 business publication in the world refers to you as somebody that is breaking the law to earn a living. And you got to put those on notice that would like to abuse WIPO to STEAL our valuable domains.

    I guess they want to save us before they crash and become worthless.

    I am open to change the pic, but I still gotta be a prick when it comes to predators and those that would like to minimize what we do by tagging us as squatters.

    1. Post author

      You results and actions let everyone know you don’t take any shit. You don’t need a picture to show that. Actions always speak louder than pics 🙂

  2. RJ

    Shane, she’s on to something – look at the most successful startups. I read about them daily..none seem to have launched on a generic keyword domain…they launched on brand able names. It’s *almost all* about the content, business model and customer acquisition..that’s why was not bid up to what a single top end bag went for at Heritage…

    Snapchat is worth over $4 billion, AIRBNB $10 BILLION+..MOST domineers will never make the 6-7-8 figures. It’s like being a trader..most traders will never make the big money. You have to create value, solve problems to make it big. Yes, there are few gifted domineers and traders. but it’s not the path for vast majority of those in the industry.

  3. adam

    Mike, he’d have to prove that it was false ? It has a variety of meanings/context and it would be difficult and time-consuming to do, I’d imagine.
    RJ. For the 2 lucky companies you mention that made it to billions there are plenty of other startups operating with a good domain that did propel them forward. A domain isn’t necessarily going to make the company a success. A better product might not either. It’s a perfect storm. Check out these 3 companies sometime :,, . . . they were all start ups at one point too. The author isn’t just talking about start-ups either. I think the people in the trenches buying names for startups can tell you that the market isn’t cooling down.

  4. Rick Schwartz

    Thank you for taking out the reference about me being a squatter from your article.

    I would like to point out one last fact.

    According to at last Months T.R.A.F.F.I.C. Domain Industry Event, at least 2/3 of ALL domain sales are not reported by Most high value deals are never reported because of non-disclosure agreement.

    Agreements that I have refused to sign over the years so that the REAL story about domain name investing could and would be told.

    So the larger the sale, the less chance it would be public unless they are a public company and even then there are easy ways to hide what was paid.

    In 2003 when I sold for $1.3MM it made the news around the world. Was on CNN. Was everywhere. Fast forward to today and my $1.35 Million sale last month was hardly mentioned. Million dollar sales are common place with domains reported or not.

    Today it is the $15MM-$20MM that would get the focus but again, according to just last month, those sales this year have not been made public. However since handles the transactions for many large deals, they do know and with some arm twisting, they shared with our audience.

    .Com is the largest, most important and most powerful franchise the world has ever known. That is what should be covered. That a few letters with a .com tells folks anywhere in the world exactly how to contact you in various forms. It is the lifeline of most every business on the planet today. I have watched it grow from less than 5% to critical mass.

    The ignorance by Madison Ave and Corp America during this time has been stunning! The misinformation even more so.

    When I was born 60 years ago all the land was bought and I had no money. 500 years of squatters I guess! But the Internet gave real estate an entire new dimension. An entire new chance. I saw that parallel and I acted on it.

    There is still plenty of opportunity in domain investing and I buy domains nearly every day of the week. Maybe I should go register

    The one thing I would hope comes from this….a real article about the important of domains based on facts that allows your readers to see what Steve Forbes himself saw when he spoke to our small but blossoming industry in 2007.

    His video is somewhere on the site so you can see EXACTLY what Steve Forbes himself believes about the legitimacy of what we do. And my 1999 is still in tact so you can measure just how many things I got right all those years ago.

  5. Mike

    Hey Rick, I remember reading about Steve Forbes speaking at your conference years ago. You should reach out to him, let him know your point of view and offer to write a story about Domains for the next Forbes issue.

  6. RJ

    Yes, the domain market has been fairly strong this year. No doubt. But compared to the startup scene? we’re lagging way behind. There is massive liquidity in the startup universe and I know of 2 startups first hand that got bought by strategic partners before they went live for $10m+ for what was 3-6 months work coding. It’s insanity! My point is we are focussed on making the next $1k, 45k $50k $100k sale when it’s raining millions all around.

  7. RJ

    Time and energy are finite. MOST are wasting them on pennies..I have seen the light and it’s already making a huge difference in the level of people I am dealing with and the kind of interest I am receiving around my business. When it came to domains 99% of my domains top out at $20k whereas with my startup $20k is the minimum I’m taking from angel investors (2 confirmed at $50k+).

    Morgan Linton is another domineer who gets it and has pivoted.

    Most of us are intelligent enough to be in the shoes of those making the big bucks.

  8. Savio DSilva

    As an outsider and an insider in the domain name business I can afford to see both sides of this article and the aftermath pretty clearly. Seems like the article has loads of truth in it since some of the domains sold at 5 figures and over in the past have been self domain name hijacked. However, she should not have got so personal by targeting just a couple of domain investors and sellers. Shane’s article here is once again based on what he knows and sees so he has done the right thing by trying to mock the Forbes article using his 3 to 5 paragraphs technique of writing. I hope that outsiders don’t view this Forbes article like we (domainers) do. It is healthy to see both sides of a story or all sides. Forbes is not a guy on the street but a multi-billion dollar company. They know how to get guys like Rick to sit up and pay attention.

  9. picas

    in her pointviews ,so i have some names means that i am really lawbreaker …but i am nothing as compare to Shane ..his portfolio makes him a really Wanted man ..ha ha

  10. Car News

    The author does not have the whole story about domains but she isn’t completely wrong.

    Rick has had made plenty of legitimate sales. However, he does own Terry Bradshow (dot) com and said I believe he is in the process of trying to sell it to him. That is cyber squatting.

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