This Chinese domain name investor is sitting on valuable online real estate.
Two letter .com domains are some of the most valuable online real estate. And you’ll find many of these domains registered to Chinese companies and investors. Chinese domain investor Yue Dai owns the largest portfolio of these prized domains, according to Whois records.
I recently contacted Yue Dai for a written interview. This interview has been lightly edited for clarity.
Do you think China will become the largest domain market in the world?
Yue Dai: I think China will become the world’s largest domain name market for several reasons:
1. With a population of 1.4 billion, the number of internet users in China will reach 1.1 billion in 2020, which is undoubtedly the largest in the world.
2. As of June 2019, the total number of domain names in China was 48 million, of which 21.85 million were .cn domain names, up 2.9% from the end of 2018. .Cn domain names are the third-largest in the world.
3. There are more than 30 million companies in China, and the diligent Chinese people are very willing to create a better future through their own efforts.
4. China’s economy is growing very fast, especially the digital economy. The government attaches great importance to the development of the digital economy. China is about to invest $5 trillion in 5G, artificial intelligence and other industries related to the internet and digital economy. More business opportunities. More domain names will also be registered.
5. From the perspective of two letter .com domains, in the past 20 years, Chinese companies have gone from no two letter domain names to more than 200. It can be seen that the trend has continued growth.
6. The novel coronavirus has brought the world’s development to a standstill. China is the fastest recovering country. A number of domain names have been sold in China this year.
I believe China will become the world’s largest domain name market. The world’s domain name investors are panning for gold in China.
Is it important for numeric domains to have Chinese meanings in order to sell in China?
Yue Dai: Chinese people like to have 8, 6, or 9 in domain names. 8 represents the meaning of wealth, 6 represents the meaning of smooth, auspicious, 9 can be understood as long, noble meaning, and 9 is the largest single digit.
The Chinese don’t like 4 because it’s a homonym for death.
Numeric domain names can also represent many Chinese meanings, such as 520 for I love you, 84 for bus and 51 for “I want”.
In particular, the Chinese have bought 80 percent of the 2-digit domain names.
Domain names like 88.com, 8888.com and 999.com are very expensive and have been bought by my Chinese friends for millions, even for tens of millions of dollars.
How can Western investors sell their domains to Chinese companies?
Yue Dai: They have the same problem I have when I want to sell domain names to Westerners: I need to find the most professional team of brokers in each country.
In terms of language, connections and culture, locals know more than foreigners. They have relationships with local celebrities, end customers, and other buyers.
So I suggest that Western domain name investors cooperate with Chinese domain name companies to reach Chinese buyers.
Chinese companies like pinyin domain names and short domain names, usually two-to-four-letter .com domains.
Too complex words are not the best choice for Chinese people.
Simple words are possible because Chinese companies are global. Top words such as House.com, VIP.com and Trip.com have been sold to China.
I bought Yuming.com, which means domain name, for a domain marketplace. We only have the Chinese version for now but will develop an English version in the future, hoping to help more Western friends to sell domain names to China.
In an article published on Yuming.com, you were said to be “the domain investor who owns the most 2-letter domains in the world.” Is this true?
Yue Dai: Yes, according to Whois, we are the largest holder of 2 letter .com domains in the world.
In fact, we used to have more but we sold about 10 in the last three years, all of them to Chinese companies. Then we bought a lot more, and now we have 16 two letter .com domains. Assuming we see the investment returns that we like, we will consider further acquisitions.
Chinese companies now hold about 200 two letter .com domains. They know two letter domains are good. A two letter .com domain name is a symbol of strength in China.
There are now over 200 unicorns in China, all potential buyers of two letter .com domains.
We are in contact with these companies. I hope there will be good results in the future.
Long numeric domains have been selling for very good prices. Example: 88889.com for $70,000 and 29777.com for $29,680 . Are they actually used by Chinese end users? Who are the buyers for such domains?
Yue Dai: Short domain names are running dry because Chinese customers are buying up a lot of 2 and 3 and even 4 number domains.
As long as it is a cheap, short numeric domain name, the Chinese people accept it.
They have a huge demand for domain names. China accounts for 30 percent or more of domain name transactions.
They buy domain names for two purposes: investment and use.
Because the domain names they bought before all appreciated in value, now they are investing in domain names in addition to using them, which is a good thing; more people are investing in domain names.
What is your opinion on four letter and other short domains?
Yue Dai: The number of four letter .com domains is too large, so the price between investors is difficult to go up.
The bull market in domain names around 2015 was actually led by Chinese domain name investors, which pushed four letter .com’s up from $200 to $3,000. It was a bubble, and now prices are basically stuck at $300 to $400.
Because two-and-three letter .com domains are getting more expensive and many domain names are not available, four letter domains are also an option for junior investors and end users. I think they will get more and more expensive.
My focus is to invest in two-and-three letter .com’s because four letter domains are too low value. Selling a two letter .com is equivalent to 500 or more four letter domains. We are willing to spend more money and time on the higher-value domain.
What do you think of the future of new extensions (.icu, .top, etc.) in China?
Yue Dai: In 2015 and 2016, Chinese investors invested in a large number of new top-level domains and country domains. With no investment in the secondary market, the prices of .com and .cn fell rapidly, and finally the bubble burst.
I don’t think Chinese investors will invest much more in new top-level domains. Even if they do, very little.
The focus is still on registering .com and .cn or buying good domain names. In China, .com and .cn are the most valuable and popular domain names.
I also invest in these two top level domains. In addition to 16 two letter .com domains, I have 15 two letter .cn, and 150 three letter .cn and 40 three letter .com domains.