Rebecca Burn-Callander from Real Business wrote an amazing article on how not to sell your domain name.
When Pat Reeves and Rohan Blacker decided on the domain name sofa.com for their online sofa retailer, the acquisition trail took them to the US â and into a whole heap of trouble. âWe knew we had to have that domain name,â says Blacker, who co-founded the firm in 2006. âThere are so few four letter words that are a product that can be sold online. It was an opportunity we couldnât miss.â
The pair tracked down the owner, a chap named Steve Galstad of Dinesenâs Leather in Milwaukee, USA. Blacker and Reeves duly contacted Galstad and asked him if he was using the domain, to which he answered âNoâ so they then attempted to purchase it.
At first, Galstad asked for the exorbitant sum of $1m. The pair had the domain name valued by an independent consultancy, who worked out that the name was worth more in the region of $35,000. Reeves and Blacker offered Galstad $50,000.
âBut he [Galstad] was very reticent to accept,â says Reeves. âHe refused to speak by phone, would take up to four weeks to reply to emails. Finally, we agreed on the sum of $200,000. He asked to meet in New York to complete the deal. But he wanted me to bring the money in cash!â
When Reeves turned up without a locked briefcase, Galstad became very jumpy. The lawyers convinced him to sign all the legal papers and he eventually agreed to have the money wired across. Two weeks later, the domain name technically belonged to the entrepreneurs, but when they tried to transfer it from the States to the UK, they found a block.
âIt turned out that he didnât actually own the domain name,â says Reeves. âHe was just the manager of the company.
âThe account number heâd given us for the money transfer was his personal account. And heâd absconded to South America with a stripper from Vegas!â
Luckily, the contract was airtight, and even though Galstad was not technically the owner of the firm, he still held âapparent authorityâ at the time of the deal. Reeves and Blacker got to keep Sofa.com. And Galstad’s luck soon ran out.
“The money ran out ten months later,â says Reeves. âSo the stripper left him. He started working as a bartender. When he won a âBartender of the monthâ prize and ended up in the paper, the police tracked him down. Heâs still serving his sentence now.”
Original article : http://www.realbusiness.co.uk/news/internet-business/5382591/domains-dodgy-deals-sofas-and-strippers.thtml