How have you been? Hope you are doing well! It has been too long, as the last time I wrote you was at the end of May. Way too many things happened in the meantime:
– Braden Pollock and Dietmar Stefitz kindly invited me to present my insights on China during the Domaining Europe conference in The Hague. What the audience appreciated the most was the slide below called “The Chinese X Factor” which presents some rough formulas you can use to calculate an approximate derivative value for any short domain:
– From Amsterdam I took an eastbound flight with Michael Gilmour of ParkLogic.com and Whizzbangs Blog with final destination China for ZG.com, the Global Domain Summit. If there is one word to describe the conference, it is definitely epic: over 1,000 attendees showed up for a great 3 days event. Many industry veterans compared the same enthusiasm we see now in China with the domain industry from a few years ago:
– While in Hangzhou, George Hong from Guta.com invited me to join a tough poker game with other Chinese investors. I ended up losing, but I wrote for you my main takeaways in a new post that covers poker, investing and decision making in general.
– George and I took a flight to Xiamen, the “Florida of China” and of the domains capital of China, where I visited Guta’s new office and met with William Lin, the CEO of XZ.com.
– I just came back to Lisbon to watch Italy pass the initial round of the EuroCup of Soccer 2016 and then win against Spain in an epic match!
But enough about my travels. Before leaving for China I asked you what you always wanted to know about the industry but never asked. The staggering majority of you asked a variation of the following question: “Will the Chinese market ever come back?” .
I think there are many opinions out there, and a lot of them are skewed towards a definite yes or a definite no depending on the interest of the writer involved. James Iles published an interesting post on namepros.com which polled the opinion of the people in the forum. Rather than give you yet another opinion about where the Chinese market is heading, I will tell you instead a story and give you a unusual reccomendation. Once I asked Alan Dunn how he developed his intuition about domain names, he replied: “By losing a lot of money“. The best investors become such because they learned the lesson, got back on their feet and incorporated the lessons learned into a new investing approach.
So here is my suggestion: as we are heading into the summer, especially if you have taken a loss in this market, take some days off to unplug and reflect. If you are in the US, the long weekend of Indipendence Day might be the perfect occasion. Stop reading anything that is written on the industry blogs, stop checking Facebook, Twitter and everywhere where you can hear domain noise, marketing messages and the campaigns to register thousands of domains cheaply. Read instead these 3 papers:
1. Principles of Ray Dalio, a former golf caddy who accumulated a net worth of $15.6B.
2. The Wikipedia List of Congnitive Biases. As much as I’d love to go fully paperless, this printed list is one of the few objects always on my desk.
3. The Intelligent Investor, by Benjamin Graham. A man from Omaha called Warren Buffett defines the Intelligent Investor as: “By far the best book on investing ever written“.
Except for “The Inteligent Investor“, these are all free resources. If you can, print these papers, and read them far away from your computer. Print facilitates focus and keeps you calm. Please take some time to read them and I promise you will get value from them.
Enjoy the summer, take care and see you soon. Maybe in Lisbon?
Mail Source: GGRG.com