Equity in domain names

[zhenjie]

So here's an interesting question, especially those with large domain portfolios.

You goto a bank for a loan. Do you put down your domain portfolio (assuming they are not developed or fall into assets that are a 'business) as an asset/equity that you can leverage off like your other assets? My guess is when it comes to valuations of domian names that it will be a complicated matter and most bankers would be oblivious to them.

 

[jhellyer]

Having been involved in the finance game for over a decade, I can assure you that the Bank Managers eyes would roll back in his/her head with confusion at the mere mention of Domain Equity...lol

 

[Data Glasses]

I asked the manager at the anz i bank with and she said 'if you had proof of purchase' it may contribute to being recognised as something of value

At first there was a blank stare while i explained, i did refer her to netfleet and drop in the hope she would see what's happening in the domain world

 

[Shane]

I don't know of any bank that would use your domains as security for borrowing against, but certainly they'd look at the income side of things provided that you could show evidence of consistent income over two years.

In terms of really valuable domains, I'm sure you'd be able to find private sources of money where they would place a fixed or floating charge over the domain or domain portfolio.

 

[zhenjie]

I think you're spot on Shane. It'ss easy to provide income from domains generating revenue. I was hoping that a domain portfolio could be seen as an asset also. It's a shame they can't be because domains are generally appreciating but hard to prove value and growth.

 

[DomainNames]

So here's an interesting question, especially those with large domain portfolios.

You goto a bank for a loan. Do you put down your domain portfolio (assuming they are not developed or fall into assets that are a 'business) as an asset/equity that you can leverage off like your other assets? My guess is when it comes to valuations of domian names that it will be a complicated matter and most bankers would be oblivious to them.

If its a portfolio under a business structure yes banks will loan on it depending on its value. Netfleet.com.au has a nice free valuation tool in the admin panel to see what the basic estimate of value of your names might be.

 

[Cooper Mills DomainLawyer]

Guys

with the new Personal Property Securities Act 2009 (which comes into operation next year) I believe that banks / lenders will start to look at domains and other IP as collateral, as to what value they place will be interesting. This new law will see the setup of a register here.

the problem has simply been how to secure IP assets. This new system of registration will allow registration of interests over domain names, as opposed to charges over a whole company. I know that Macquarie Bank has been to a few domainer functions we have organised, so I suspect they and others have thought about the value of domain names.

This is one to watch!

 

[snoopy]

So here's an interesting question, especially those with large domain portfolios.

You goto a bank for a loan. Do you put down your domain portfolio (assuming they are not developed or fall into assets that are a 'business) as an asset/equity that you can leverage off like your other assets? My guess is when it comes to valuations of domian names that it will be a complicated matter and most bankers would be oblivious to them.

Show them a profit and loss statement/income statement and they will lend, show them a list of names with no financials and they won't.

The most practical way to approach it would be to put down business details rather than having to have an in depth discussion about domain names being assets, in truth most domain names aren't assets and that is why most banks would rightly "roll their eyes".

If you really want a bank to take domains as security, as opposed to just looking at cash flow then you'll be out of luck and will have to use services like domaincapital.com, which will effectively give you are rate like you are financing a tv set or a holiday to europe (actually the rate is typically worse than that kind of lending (~15%)).

 

[Designer]

Are there any specialist domain lenders in Australia? Like in the USA.

 

[snoopy]

Are there any specialist domain lenders in Australia? Like in the USA.

No, the market is too small.