We often talk about startups that are launching and getting successful. And, some become a unicorn also. And, it’s normal. Because we like to learn from businesses that are growing and creating opportunities. So, basically, we are not interested in businesses or startups that are getting shut down due to a bad idea and product failure. But, as a domain investor, it’s important to study and keep eye on startups that are failing and getting out of business. Here is I think why?
Idea Failure: Every startup has an idea around which it’s built. And, if they fail that means the idea too failed. And, sometimes the idea fails because it cannot sustain competition from businesses providing services on the same line. For example, recently QUIBI announced it was shutting down. The streaming service that officially launched six months ago. It was a risky idea, to begin with, because why would viewers pay Quibi when there are many free streaming services like YouTube, TikTok, Snapchat, Amazon, Netflix, Disney+ Twitch, and other platforms.
For domain investors who are holding domain names that are descriptive and meant for video-streaming this news is not good. Because more and more startups will stay-away from the idea of launching a streaming service. And, when it happens – it means no new buyer for your domain name. And, you have to rely on existing players to buy your domain names. And, for this matter, your domain name has to be descriptive and should have good search volume. Brandable names meant for streaming may not find a quick buyer.
This is just an example that may or may not hold true but the basic underlying principle says an investor should reevaluate his portfolio and look for domain names that have some commonalities with the failed startups. And, once it’s linked – dropping the price, following up with the previous prospects, and replacing the domain name with other fast-emerging technologies may be a good option.