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Fractionalized domain name ownership comes to Rally

Shares in Directions.com will be offered on Friday.

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Investing in a fraction of a domain name is about to become closer to reality.

Tomorrow, fractional ownership platform Rally will sell shares in the domain name Directions.com. Investors can chip in as little as $10 for up to 14,000 shares in the domain, for total proceeds of $140,000. A Use of Proceeds tables suggests that the asset seller might retain up to a 45% stake in the domain.

It’s the first time I’m aware of shares in a domain name being offered on a platform.

Fractional ownership could unlock significant value in domain name assets by creating more awareness of domain names as an asset class and enabling smaller investors to pool resources to acquire high-value domain names.

A due diligence analysis from WilyFish (associated with the law firm Greenberg & Lieberman, LLC) for the domain name checks for prior UDRP disputes (none) and grades the domain based on its Whois history, email blacklists, search engine reputation, trademarks, and domain names.

It seems that the domain might have been chosen in part due to its previous sales history. It last sold for $75,000 at NamesCon in 2020.

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  1. Abdu

    I wonder what happens when a domain gets hit with a UDRP. I guess you’ll have a lot of unknowns with fractional ownership.

    • Andrew Allemann

      There are certainly some unknowns, but they aren’t insurmountable and not much different from owning the domain outright.

      First, I’d argue the odds of a UDRP are very slim. But, much like owning a domain, you’d hire a lawyer to defend it. If there is no mechanism to collect fees to defend it, then the partnership can front the money as an expense and deduct that amount from an eventual sale.

    • John Berryhill

      The same thing that happens when any corporation with multiple owners, or partnership with multiple owners, gets involved in a legal dispute of any kind.

      I own shares of Apple. Apple gets sued all of the time.

      Maybe I just don’t understand the question, but it has popped up here and other places in response to this vague idea that they are selling “shares” in a domain. Whatever it is they might mean by that, there is certainly no problem with legal claims against whomever the registrant of the domain name must be. Even if they do set up a special purpose business entity or partnership to be the registrant, there is no new problem that arises from legal claims against a business entity or partnership.

      But this is a little more cynical than structuring each domain name to be truly owned by multiple persons who were told they have shares by someone who sold them the shares. At bottom, a domain name is a contract between the registrar and the registrant. The registrar doesn’t care if the registrant sold you “shares”. You are either a part owner in the entity which contracted with the registrar, or you are not.

  2. chad folk

    Great to see others wrapping domains in a llc and selling programmable fractions of an asset., eshares.com is specifically built to fractionalize domains onchain and has over 200 premium domains tokenized and on chain and available to stake -247.
    We need more rally road and realtydao companies fractionalizing and showcasing domain assets utility. Rally has a great product to scale the market, if demand but trading crypto tokens 247 seems to be where the demand and attention is at the moment.

  3. Andrew Rosener

    I couldn’t be more excited or more proud of this partnership that I (MediaOptions / DomainX) have built with RallyRd over the last 4 years and today’s public offering of Directions.com is the culmination of that effort!

    We have worked with RallyRd to get Domain Names as an asset class approved by the SEC for fractional investment. We believe this is a natural evolution of the asset class and an incredible leap forward in providing access to anyone and everyone that wants exposure to the asset class at nearly any level they feel comfortable. Not only that, but publicly traded shares of premium domain names will with time achieve my dream of valuation standards and market to market pricing that will allow institutions to invest in this nascent asset class that is the undeniable back bone of the entire global digital economy! An asset class that we believe fundamentally is one of, if not the single most, undervalued assets on the planet. Domain names aressets with some of the highest utility and demand, ever decreasing supply and exponential growth among the global user base and adoption curve.

    Directions.com is the first domain name we are taking to market, but there will be many more to come and we’ll be experimenting with different types of domains, categories of domains, single names vs. a “basket” of names, themed packages of names (think cannabis, crypto, health, etc…) and much more to come!!!

    Today is the day that MediaOptions plants its flag on the Moon!

    One small step for MediaOptions, one giant step for the domain industry!

    Anyone with an ultra premium domain name at a fair market valuation can contact MediaOptions to evaluate and potentially take their domain name public via RallyRd. We are the exclusive “on ramp” for this asset class.

    Let’s go!

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