What's the one thing almost every entrepreneur needs these days? A domain name. Here's a closer look at the business of buying and selling domains.
It"s the 21st century, and every business needs a place to park on the Net. "It's virtual real estate," says Mike Magolnick, co-founder of SolutionHome.com, a domain name auction and appraisal site. Magolnick, 30, got into the domain name game when he was offered $1,500 for ventureconsulting.com, a domain he registered for his venture consulting business. Realizing he could gain serious profits from registering names and selling them to the highest bidder, he founded SolutionHome.com with his brother Joel, 37. Mike registered 400 names, planning to sell them-now most of the names listed on his site are owned by his clients-to the tune of more than 1 million domains up for grabs.
Trafficking so many domain names can be perilous when skirting cybersquatting issues, and Mike is very aware of the risks. "We don't touch anything that would be remotely related to a trademark," he says. "The last thing you want to do is play around with something like that-there are fines up to $100,000 for taking someone else's name and attempting to sell it. There is definitely no room to play in this industry."
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