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I just spent $35,000 on a domain testimonial.io 🤦♂️
The original listing price is $52,799. But luckily, after some negotiation, we were able to make the deal at $35,000 🤝
A little background of me, I'm Damon, and I am the founder of Testimonial, a platform that helps businesses collect, manage and distribute testimonials in a single place. Our website domain is testimonial.to.
Why do I need another domain with the .io TLD? Why do I think it’s worth $35,000?
It's all due to Joe's Twitter thread, where he mentioned several products that he previously used to develop the MVP (Minimal Viable Product).
Testimonial is flattered to be mentioned alongside some well-known companies such as Wix, Webflow, and Zapier.
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The tweet that mentioned Testimonial got 132 likes, more than 82 likes that Webflow got. The whole thread amassed over 1600+ retweets, and 7800+ likes. IT'S A VIRAL THREAD! 🔥
But...
Joe misspelled our domain. Instead of testimonial.to, Joe spelled testimonial.io 😭 I didn't get any visitors benefit! According to our traffic analytics, March 1st is just a plain day.
It bugged me for a quite while. I thought to myself, "what if I own the domain testimonial.io? Will Joe's thread help me get new customers? How many new MRR can this thread contribute to my business?"
I totally missed it. But I don't want to miss it again. As a result, I decided to purchase the .io TLD domain.
It is the most expensive domain I ever bought, and $35,000 is a loooooot to me considering I’m bootstrapping my business, but I still think it is very much worth it. I’ll do some math to explain it!
In SaaS, a company's valuation is largely determined by its ARR (Annual Recurring Revenue), growth rate, and other factors. As per SaaS Capital's report, in 2022, the median private company would be valued at 7.2x ARR. The multiples can be ranging from 2X to 16X.
Testimonial is growing fast, so assume its valuation is 10X of its ARR. Now back to doing our math! To justify the $35,000 domain cost, I need to add another $35,000 worth of value to my business. To get a $35,000 new worth of value, I need to gain $3,500 ($35,000/10) new ARR, which also means I only need to get 6 new customers ($600/year * 6 = $3,600 ARR).
Joe's followers are mostly entrepreneurs or those who work in the tech sector. They are my target users too. If I had testimonial.io and everything was in order, Joe's viral thread might provide me with 6 new customers immediately. But I'll never know if that were the case because the world can’t be reset.
To be honest, I've seen people misspell my domain many times in the past. Even my existing paying customers mistyped my domain to testimonial.io.
Luckily, I've been bootstrapping Testimonial for the last 1.5 years, and I finally had enough money to purchase the .io TLD so that something like this doesn't happen again.
If I don't buy the .io domain now, I will continue to lose more traffic in the future when the typo happens again. I might not get as lucky next time to have someone with a huge Twitter following mention mistakenly mentions testimonial.io.
As testimonial.to is getting more and more popular, the price for .io domain will ride the wave and only go up. The sooner I buy it, the better deal I will have!
Lastly, the .io TLD is definitely more popular compared to the .to TLD. Some people may not even know there exists the .to TLD. The .io TLD is seen as being modern, tech-savvy and trustworthy! In terms of domain investing, it’s a good investment to have a one-word .io domain!
I'm quite happy with my decision, and I hope this story provides some context behind my actions. Now I'm waiting for another viral tweet, and I won't care if someone misspells or not, they can use any of these below: 😅
If you've made it this far, thank you for reading! 🙂. I also tweet a lot about my startup's progress on Twitter at @damengchen. Follow me if you are interested 🙌
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