Supernatural Agency: Online business tales

“Economic uncertainty. The best place to be when revenue is hard to generate is a pre-revenue company. Whether or not we are headed into (or are already in) an economic downturn, and whether or not that will impact advertising expenditures, many in the market are already exercising caution. In times like that, big companies start acting more defensively and give up more white space to start-ups. This is good for start-ups.”

Dave Morgan offers five more reasons for starting an Internet company now and they’re all good ones.

This list covers just about everything I’ve ever heard of or thought about for raising cash to get started. If anything it shows the degree of commitment and risk you need to have to get out there and succeed.

This is not an endorsement of all of these techniques!

I was recently speaking to a friend of a friend who has started buying domains. She has no Internet background and knows nothing about domaining as the ‘industry’ (make that cottage industry  , knows it. Never heard of parking, type-in traffic, reselling, flipping, etc.

It’s what she did know that I thought was important. For every name she had registered she had a complete business scenario that made sense as a standalone business. She knew what they would sell, how big the market was, had profiles of who might visit the site and exactly how the business would earn money. She did not pick names that were odd combinations of words or were hard to remember. Most were three word dot coms (all were dot coms- she didn’t know that you could use non-dot coms for businesses). Her biggest challenge was figuring out which to develop first. One strategy she had shaped was to go to a local business that fit one of her names and offer to partner- she would own the site, they would fulfill and pay a commission- a kind of mom and pop affiliate deal.

It was refreshing to have a discussion of our business with someone smart who doesn’t have any pre-conceptions about what is the ‘best’ way to make money with domains. I suspect she will do very well. I know I learned something from her POV.

I like to tell people that we run a business with no employees and no customers. You can watch the wheels turn as they chew on that one. If they are business owners themselves they almost always have a wistful response that includes a ‘I hope that works for you’ look.  ;-|

The fact is there are very successful businesses that are profitable without employees or customers- they’re called investment or trading firms. In many cases they may be an individual or partners that only trade on their own account (they don’t manage money). Taking some capital and growing it via investing or speculation is an age-old business that is not reliant on customers or dependent on employees.

The domain world is simply the latest incarnation of this business model. Of course you can hire employees but you don’t necessarily have to. And you could provide domain services like development to customers but why would you make money for them that you could be making for yourselves? Domaining can liberate you from these responsibilities if you don’t want to deal with them. It might take longer to grow but the upside potential is still huge- after all how many businesses can you start with an $8 name and a hosting account?