Domain Name Acquisition Value

When acquiring businesses, consider the value of domain names as an additional asset that can provide significant upside to the deal. This strategy was demonstrated in a deal where a domain worth $1-2M was acquired essentially for free as part of a larger business acquisition.

Key Points:

• Case Study Example:

  • Acquired a $10M revenue business that was shrinking
  • Got the business essentially for free through clever debt financing
  • Domain name alone was worth $1-2M depending on sale timeline
  • Entire purchase price was paid back within 3-4 months through business cash flows

• Strategic Considerations:

  • Look for deals where valuable domain names are bundled with business acquisitions
  • Domain value can provide downside protection or additional upside
  • Can be particularly valuable in distressed or quick-sale situations where sellers may not fully value these assets

• Financial Structure:

  • Used debt financing to acquire the business
  • Business cash flows paid back the loan within months
  • Resulted in essentially free acquisition of both business and valuable domain