First of all now is a damn good time to invest $100,000 in the domain industry. If you wish to be a domainer, then the deals that are there for the taking are just simply breathtaking.

However, if you have $100,000 to spend then I would assume that you are not stupid and would be prudent with your investments.

Like with any other investments, you would think of the exit strategies. How do you make a return on investments and how do you exit the market without any significant losses if the need arises?

If I was just coming into the domaining business and I had $100,000 to invest, I would not invest in domains. Yes, you heard me. I would NOT invest in domains.

I would invest in an ebusiness.

Domain parking is still alive. Although domain parking was never transparent from day one, and that within itself presented a significant loss of control over any meaningful planning, it was sensible in the past to invest in traffic domains.

Domain parking is still non-transparent, there is still a fair amount of lack of control, and the future is a bit uncertain.

If you want to make money with domains now, you have to invest in quality domains with the aim of developing those said domains into powerful brands.

So, if I had $100,000 to invest, this is how I would invest it.

Conduct sufficient research and analysis into various markets, industries and niches. I would look to see which markets have the potential for growth, where there is less competition, but where there is great demand for a particular product or service.

Once I have narrowed down my list, I would get one, two or a maximum of three category-killer, niche-buster, keyword-almighty domain name(s).

How much I spend on these each domain would depend on how much domains am acquiring. I would say:

40% on the domain(s)
30% on web development
20% on marketing, advertisement and PR
10% on working capital/reserve

The percentages would vary depending on the industry and the level of outside expertise required.

What I am trying to illustrate here is that it is absolutely stupid to blow 100% of the $100,000 solely on domain acquisition.

You would need to leave a great chunk of money to develop the domain name into a brand. You will need a logo, a website, newsletter, blog, SEO, marketing, ongoing web maintenance costs, etc., etc.

You can get a damn good domain name for $20,000 today. Forget about the million-dollar domain purchase. If I wanted to invest a million dollars now in domains, I would spend only $200,000 on acquiring 20 top domains at $10,000 each and use the remaining $800,000 to build the brands.

Web development and Internet marketing costs are relatively cheap these days due to competition. Loads of developers and loads of online outlets such as blogs vying for the same advertising dollars.

Plus, there is the use of web 2.0 technologies and media such as blogs, forums, Twitter, Facebook etc. etc.

Perhaps we should stop moaning about finding end-users to buy our domains and start evolving into end-users.

Don’t invest in domains; invest in brands. Build brands that will evolve.