Domain name marketplace is trying to improve the process of buying and selling domain names.
If you aren’t happy with current domain name marketplaces, the simplest thing to do would be just to complain. On the other end of the spectrum, you could build your own competing domain name marketplace.
That’s exactly what the founders of Undeveloped.com decided to do.
Co-founder Reza Sardeha explained that he was unhappy with existing marketplaces and wanted to come at domain selling from a fresh perspective.
“From a seller perspective, we wanted to make domain trading easier,” he said. “We wanted a platform that was solely based on selling, rather than monetizing. We really didn’t see anything out there that would allow you to become a good seller.”
Once Undeveloped launched in 2014, the company realized it needed to put much more focus on domain buyers.
“If you want to build a very liquid marketplace, you should start including the buyer side,” said Reza. “Without buyers you can have the most amazing domains, but you won’t sell them.”
So Undeveloped worked to create a more transparent marketplace that would make buyers comfortable acquiring domains on the secondary market.
For example, buyers can see the seller’s name or company name on for-sale landers. The landers also include information about pricing and the process of acquiring the domain.
While listing your name on the sales page and setting fixed prices is optional, Undeveloped has data to back up the sales lift serllers get from adding these.
Additionally, since 70%-80% of negotiations don’t lead to an agreement on price, the company is creating content to educate buyers about the value of domain names.
Reza said the company also examined why people failed to submit offers on domains in the first place. Its original landers asked for an offer upfront. This was a major deterrent to buyers.
To get buyers to show up to the marketplace, Undeveloped researched where businesses go when they need a company or product name.
Since many of these users search for the name they’re interested in, Undeveloped focused on SEO for its for sale landers. As a result, a quarter of all leads customers receive are the result of someone finding their “for sale” page through a search engine.
The landers also have a title tag noting the domain is for sale, as opposed to parked pages that promote the topic instead.
In the future, sellers will have the option of including custom content, stats, payment options, etc. on the landing page.
Undeveloped is also innovating on the escrow side. For some ccTLDs such as .nl, it can instantly transfer domains to its own registrar upon receipt of payment. This allows it to pay out sellers quickly.
While Undeveloped is still much smaller than established marketplaces like Sedo and Afternic, it continues to find ways to differentiate itself. It boasts 21 million names for sale, but the majority of these are not directly listed with the service. The company crawled for unused domains and then included them in its database. When a customer inquires about one of these domains, the company reaches out to the owner to engage them. 80% of the time, they can bring the domain owner to the table.
Like most of its competitors, Undeveloped charges a 15% commission on sales, including escrow fees.
The company raised a $350,000 seed round about seven months ago and currently employees 17 full-time equivalents.
Creating a marketplace is hard. It’s a chicken and egg problem. But Undeveloped seems to be taking some innovative approaches and is a company to watch.