How To Go About Pooling Investors For A New Profitable Business?

Hello Everyone, I am writing to see how I would go about finding domaining related investors who may want to invest money in a profitable domain related idea. Usually I am flying solo in the domain arena, but lately I have been working on a master scale plan. The plan is very unique and hasn’t been discovered yet. There’s no risk involved, and I may end up getting a loan to cover the cost of the operation. I’m just curious how I would go about finding investors who would invest in this profitable idea – and would like to be proactive during the development phase & almost instantly proactive in obtaining profits back for their investment.

This idea isn’t related to drop catching expired domain names. Instead it focuses more on the other side of the coin which entails securing sales to end users. To get to the point, it is focused around liquidating domain investor’s portfolios and putting the right domain names into the right end users at the right price to make both parties happy. The technology I am working on encompasses small, medium and large scale businesses / end users. I value domain names the same as I value real estate. The difference here is that virtual real estate has a lot of potential and margin for profit. In my calculations, it could very well double my investment in money & time within the first year & continue to double my & my investor’s investment every year as a sure fire guaranteed & legal way to make money.

I’m in my mid thirties and have a family, so operating this business by myself isn’t ideal at this point in time. My experience  has taught me that the more involved others get with a successful idea, the more it will prosper. I lack the funding, marketing, sales and drive skills other investors or their investments may bring to the table. I also lack having the time to work on this project all by myself 24×7 to bring it all together in the time window I forsee before the cat gets out of the bag & everyone else catches on. There’s importance in being the first at a unique idea, doing it right the first time, and harnessing it’s strength to become a very profitable trailblazer in this industry. If a good idea works, others will catch on and mimic it, but the first brand to actually do it will be where everyone goes.

The idea in itself will require a low startup fee, however there will be a time frame where we as a group will be waiting for our commission to arrive. Ideally, a good investor would be someone who holds a mediocre domain name portfolio with end user prospects. This way, we can focus more on selling our own warehouse of domains & reaping the benefits, tweaking the system and adjusting before going public as an equivalent to as most would consider – your everyday real estate / mortgage company. Once our overhead costs can be covered and the wheel starts spinning, the commission wait during the escrow process or domain push / final payment won’t be an issue. The issue I am seeing is how to get the ball rolling now and it all boils down to having capital on hand to pay for overhead costs until we’re all paid out & the funds are divided up evenly between the board of directors.

Some questions I have would be if it would be a good idea to start up a new corporation for this venture or umbrella it under my current corporation. If so, I am leary since my current corporation & drop catch strategy solutions are so profitable – I want to keep this venture separate. Does anyone have any tactics or advice I could use to find investors? How would I go about making everyone happy and operate the business as the founding owner & CEO of the operation? Would the investors obtain company stock and the company have to go public before inviting investors to divest in the business? I guess there’s a lot I need to learn – but I am on the right track as I have been doing research & a lot of businesses look to investors to make their dreams a reality. I’m sure I can get a bank loan & become profitable, but it would be nice to work with similar minded people to push & motivate each other to a goal of everyone getting a fat check for their efforts & investment.

The system I am building is perpetual and not a one time deal. I am looking to establish a brand that will be here tomorrow and provide consistency to the domain seller & buyer. It will be a pleasant experience, one that will travel through WOM (word of mouth). Some marketing may be required, but that will be to cover the awareness needed globally to fit a service no one has come up with yet & simply makes sense & is desired. The funding I am seeking will be for development, research & staff to carry on the idea to it’s fullest. Once the wheel gets rolling, there should be no stopping it as everyone will profit from the initial idea. Basically if something makes sense & it works, it will operate itself by providing a means to take the profit, re-ingest into the system and continue to spit out profits for the employees & investors / share holders.

The technology I am brewing up doesn’t use bad practices such as:

  • Emailing whois emails with end user emails
  • Bombarding emails with SPAM
  • It won’t use a MLM (Multi Level Marketing) Ploy or related bad practices
  • Here today, gone tomorrow strategy – it’s long term (forever) oriented
  • Won’t scam or blind sight buyers who will have remorse. It will be the opposite where buyers will keep returning
  • Won’t make any empty promises, but instead be something that clicks and make sense to both parties

If anyone is willing to talk more about this, I am all ears. I was going to consult with other domainers and business people I know these ideas, but thought I’d post on my blog first to see what comes out of it. While I’m not promising any investor that you’ll become a millionaire overnight, there is potential in this system to make a hefty / considerable sized profit in a short period of time. I’d assume along the lines of doubling your money (initial investment) within the first year or two and let the profits snowball in for the years to come. The system I built has been very profitable for me, but I usually sell my own domains with this system. A good and average example would be that I pick up an expired domain name for approx $9.75 and the system allows me to flip it near instantly for around $200 – $599 average. It won’t work for all domain names, but other ends of the system have measuring aspects & with human interaction, we can leverage liquidating domains we own & other people’s domains for huge profits.

Let me know your thoughts & if you’d like to invest in my new system soon to be coming out. If need be, I will release it on my own, but feel like there could be more synergy if I involve other entrepreneurs who can also provide domains, funding, feedback and belief in the system. It just seems like it would be a much better ride down profit avenue if we work as a team and everyone gets a bite of the cookie here. Thanks for taking the time to read this & I look forward to working with you in the future.

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14 Comments »

 
  • Sounds interesting. I would not be able to contribute any time working in or on the business but may be able to provide capital and sit on an advisory board.

  • It should be a new corporation so that it does not interfere with your existing business. Also investors do not like complicated company structure.

    As you mentioned that the initial expenses will be low, so I would suggest to build the initial version of the system, get early customer on-board and get the revenue rolling. Then it will be easier to try to raise seed/angel money. You can use AngelList(Angel.co) to raise money. It’s a great platform for startups to raise money.

    I would strongly recommend reading Mark Suster’s series on angel investment, http://www.bothsidesofthetable.com/angel-topics/

  • Garry Epperson says:

    Holy crap I thought I was reading an article from The Onion. I think this post contains 100% of the things NOT to say when pitching an idea. I absolutely don’t think you left anything out. It has it all:

    No risk
    Huge rewards
    I could do it myself if I really wanted to
    I have plenty of money already but I want to use yours
    You do all the marketing and sales and put in the time whilst I sit on my fat ass and spend your money
    We’ll sell YOUR mediocre portfolio to test it (and split the money)
    All the keywords (umbrella corporation, divest, synergy, get the ball rolling, board of directors)

    Please throw this crap in the trash and don’t ever pitch it again this way. Anybody would be an idiot to give you money based on this post. The first thing you should do is learn how to sell. And consequently, one of the best places to learn is with the aforementioned MLM (which by the way is NOT a bad practice as you suggest.) MLMs have made lots of people millionaires. But there’s one secret that you have evidently not learned yet, you have to put in the time and work. Nobody is going to give it to you.

    Now you can completely dismiss this as bullshit or by some miracle you can listen to this and learn something from it.

  • Furkat says:

    Try to approach VC or kickstart.

  • Garry Epperson says:

    Sorry I didn’t realize you only posted positive comments or I wouldn’t have wasted my time.

  • admin says:

    Thanks Morgan,

    I will work on the overall idea and flesh it out as far as I can. I appreciate you offering to help & I will keep you in mind when I’m ready to present the system and have the basic business structure in place.

    Dan

  • admin says:

    Hi Rahul,

    Thank you for your valuable input. I will read Mark Suster’s angel investment series. I agree that it will be best to build out a new business and keep it simple. I also agree that it will be best to have the basic system and business structure in place before pitching the idea to possible investors. I appreciate your feedback, thanks again.

    Dan

  • admin says:

    Hi Gary,

    Thank you for the feedback. I’ve never had to ask for funds so this made sense to me to post what I was thinking and ask for advice. I understand MLM’s have made people millionaires, I was referring to the bad practice MLM’s. I agree that it will require a lot of work and time, hence why with funding some of the work can be broken up and given to people who specialize in those areas. I’ll keep your advice in mind to not pitch asking for funding this way again. The way I see it, if I’m straight forward with what my intent is, an investor may value that and give it a chance.

    Dan

  • admin says:

    Hi Furkat,

    Thank you for the comment. I assume you mean kickstart.org? If so, I will check it out. About VC, I wasn’t a business major in college so I’m not sure how to go about finding venture capital. I appreciate your comment and will look into VC and kickstart. Thank you.

    Dan

  • admin says:

    Gary,

    I always post all comments on this blog. Good or bad, it will be approved & I will reply. I couldn’t get around to replying to your first comment because I work fulltime and now getting around to approving the comments.

    Dan

  • Jay says:

    Dan,

    I would be interested in learning more about your project and could act in various capacities if it were something I deemed worthwhile.

  • admin says:

    Thanks Jay,

    I will keep you posted on the progress of the system to get it all in place as much as I can. Thank you for the encouragement.

    Dan

  • Arseny says:

    I wish I could help with substantial funds, but I can help with B2B sales experience.

    By the way, isn’t it the right time for domaining industry to finally come up with it’s own crowd funding?

  • admin says:

    Hi Arseny,

    Your B2B sales experience may be what we all need to flip more of our portfolio in the small to medium business category of end user buyers! I like your thinking about crowdfunding! It makes sense to me.

    Dan

 

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