Imagine you’re Example LLC, a fast-growing SaaS company proudly operating on Example.ai. Revenues are climbing, investors are circling, and the team is sprinting. Then someone asks:

Shouldn’t we own Example.com? And if so, how much is it worth to us?

It’s a deceptively simple question. But the answer isn’t about vanity, it’s about valuation. Here’s how you run the numbers like a CFO, not a founder caught in FOMO.

Step 1. The Stakes of the Suffix

Your brand is Example. The extension is just the frame around it. But frames matter.

• .ai signals cutting-edge, but also “startup in testing phase.”
• .com still signals trust, global scale, permanence.

Investors, enterprise clients, and consumers may not articulate it, but they feel it. If your competitor owns the .com and you don’t, you’re renting credibility.

Step 2. Relief-From-Royalty: A CFO’s Tool

The Relief-From-Royalty (RFR) method is what companies like Cars.com and GoDaddy use in their SEC filings. The logic is simple:

👉 If you didn’t own the name, what would you pay in royalties to license it?

That avoided royalty stream is the domain’s economic value.

Step 3. Crunching the Numbers

Let’s say Example LLC projects $50M in branded revenues over the next year.

• On .ai, the brand carries some weight. Call it a 0.5% royalty equivalent → $250k/year.
• On .com, the same brand commands more trust. A 1.5% royalty equivalent → $750k/year.

Incremental uplift: $500k/year in avoided royalties.

Discount that stream at 12% with a modest 3% terminal growth, and you get:

👉 ~$5.5M fair value for Example.com.

Step 4. Beyond the Math

Domains are distribution. Owning the .com doesn’t just look good, it saves you money and risk.

• Lower CAC: More direct navigation, fewer lost clicks.
• Email deliverability: Fewer phishing attacks, fewer lost leads.
• Investor signaling: .com tells the market “we’re here to stay.”
• Global expansion: .com is universally recognised.

Add those in, and the strategic premium nudges the real number closer to $6–7M.

Step 5. The Buy or Pass Decision

• Seller asks $10M? On pure math seems overpriced. But if you’re playing defense, blocking competitors, eliminating long-term risk, and locking in brand equity that compounds for decades it can still make sense as a strategic insurance premium.
• Seller wants $2 – 3M? That’s an easy yes. The uplift is clear, and the ROI window is short.
• Seller anchors at $5M? That’s around fair value. At this level, the real question isn’t whether to buy, but how you structure the deal:
  • Straight cash: cleanest, fastest, eliminates uncertainty.
  • Cash + equity: conserve runway while letting the seller share in the upside.
  • Lease-to-own: spread out cost in a predictable, cashflow-friendly way.
  • Earn-outs tied to milestones: align payment with growth, de-risk the outlay.

Step 6. The Big Picture

Owning the right domain is not a marketing flex. It’s a capital allocation decision. Just like buying a factory, acquiring IP, or securing exclusive distribution rights.

When you apply valuation discipline, Relief-From-Royalty plus a strategic lens, the domain stops being an emotional debate and becomes what it really is: a digital asset that can tilt the playing field in your favour.

If you’re on Example.ai and considering Example.com, don’t just ask “do we want it?” Ask, “what’s the uplift worth to us?” The answer, in this hypothetic case, is millions. And that’s why serious companies don’t treat domains as URLs. They treat them as assets.

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The right domain name is an important consideration when it comes to building and protecting your brand. If you’re ready to take the next step and invest in a perfect domain name for your business, contact us to learn more about our available options and how we can help you get started.

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