Domain Portfolio ROI and P&L: Know Your Real Numbers
Ask a domain investor how their portfolio is doing and you'll usually get the story of their best sale. That's not a P&L. A real P&L counts every renewal on every name that never sold, and it's the difference between a profitable operation and an expensive hobby that had one good day.
The math is simple; the discipline is keeping the inputs. Here's what to track and how to read it.
Cost basis: the full price of every name
A domain's cost basis is everything you've spent to own it: the registration or purchase price, marketplace and escrow fees on acquisition, and every renewal since. A name registered cheaply and renewed for five years has a cost basis several times its sticker price — which changes both the profit math when it sells and the drop math when it doesn't.
Track basis per domain, not as a blended portfolio number. Per-domain basis is what makes the renew/drop decision rational and what you'll need for records at tax time.
Renewal drag: the cost of the names that don't sell
Renewal drag is the annual carrying cost of your whole portfolio — the sum of every renewal you'll pay this year. It's the number your sales have to clear before the portfolio makes a dollar, and it grows silently every time you register something and forget about it.
Two portfolios with identical sales can have opposite outcomes because of drag. A hundred names at typical .com renewal pricing carries very differently than a hundred names in premium-priced TLDs, where annual holding costs per name can be many times higher.
Know exactly what your portfolio earns
Sourdough tracks cost basis, renewal spend, and sale proceeds per domain — real P&L and ROI for your whole portfolio, not a spreadsheet guess. 7 days free, then $10/mo. $0 due today.
Realized vs. unrealized: only one of them is money
Realized P&L is sale proceeds minus fees minus the cost basis of the names that actually sold. Unrealized "value" is your estimate of what the rest might fetch — useful for planning, dangerous for scorekeeping, because domain valuations are wide ranges and illiquid assets don't mark to market.
Score yourself on realized P&L net of total portfolio drag. If you also want an unrealized view, be conservative: value names at what comparable sales suggest a buyer would pay this year, not at your asking price.
Sell-through rate: the industry's honest metric
Sell-through rate is the percentage of your portfolio that sells in a year. Across the industry it is famously low — low single digits per year is the commonly cited neighborhood — which is exactly why renewal drag dominates the math. If roughly one to two names per hundred sell in a year, each sale has to cover its own basis plus the drag of the ninety-eight that didn't.
Compute yours annually: names sold divided by average names held. It tells you more about your acquisition quality than any appraisal tool.
The numbers to keep on one screen
- •Per-domain cost basis (acquisition plus cumulative renewals).
- •Annual renewal drag for the whole portfolio.
- •Realized P&L year to date: proceeds minus fees minus basis of sold names.
- •Sell-through rate, trailing 12 months.
- •Sourdough tracks cost basis, P&L, and sales analytics per domain automatically once your portfolio is imported — with a 7-day free trial.
Frequently Asked Questions
How do I calculate ROI on a domain sale?
Sale price minus marketplace/escrow fees, minus the domain's full cost basis — acquisition price plus every renewal you paid while holding it. Divide the profit by the cost basis for the return. Counting only the original registration price overstates every sale.
What is renewal drag?
The total annual carrying cost of your portfolio — every renewal fee you pay this year across all names. It's the amount your sales must exceed before the portfolio is profitable, and it's the number most investors have never actually added up.
What is a good sell-through rate for a domain portfolio?
Industry sell-through is commonly cited in the low single digits per year — roughly one to a few names per hundred held. Rates vary a lot with portfolio quality and pricing strategy, so treat your own trailing 12-month rate as the benchmark to improve, not an external target.