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The Watercooler
Potentially Sticky Ethical Situation Regarding An End User
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<blockquote data-quote="billp3" data-source="post: 2232763" data-attributes="member: 139881"><p>It's not quite that simple.</p><p></p><p>There is a conflict of interests here. You are investor, yet you are hoping to get a payday out of the company at a later date by selling them a domain.</p><p></p><p>I personally think it's unethical, and if done to me our relationship would surely be damaged. Is the possibility of your reputation and future connections in this area being harmed worth it?</p><p></p><p>Things to consider:</p><ul> <li data-xf-list-type="ul">% of equity you have in the company. If they are the next FB, is a future domain sale going to make that much of difference? </li> <li data-xf-list-type="ul">The formality of the investment agreement -- did you sign a document that might restrict this type of situation?</li> <li data-xf-list-type="ul">Is the business name trademarked? If so, you might be inviting a UDRP later down the road. Even if it isn't, you're not 100% covered in the event of a UDRP since the domain was obviously acquired with the intent to sell it to them at a profit. That will be hard to deny since you have inside knowledge of the company.</li> <li data-xf-list-type="ul">How would you react if you were in other party's shoes and what you are proposing was done to you?</li> </ul><p></p><p>If I were in your situation, I would see if they're interested in acquiring the .com now at the price you were quoted plus a broker/finder's fee of some sort. If they pass, I would tell them that you plan on acquiring the domain for your portfolio, making sure it's all in writing/email.</p></blockquote><p></p>
[QUOTE="billp3, post: 2232763, member: 139881"] It's not quite that simple. There is a conflict of interests here. You are investor, yet you are hoping to get a payday out of the company at a later date by selling them a domain. I personally think it's unethical, and if done to me our relationship would surely be damaged. Is the possibility of your reputation and future connections in this area being harmed worth it? Things to consider: [LIST] [*]% of equity you have in the company. If they are the next FB, is a future domain sale going to make that much of difference? [*]The formality of the investment agreement -- did you sign a document that might restrict this type of situation? [*]Is the business name trademarked? If so, you might be inviting a UDRP later down the road. Even if it isn't, you're not 100% covered in the event of a UDRP since the domain was obviously acquired with the intent to sell it to them at a profit. That will be hard to deny since you have inside knowledge of the company. [*]How would you react if you were in other party's shoes and what you are proposing was done to you? [/LIST] If I were in your situation, I would see if they're interested in acquiring the .com now at the price you were quoted plus a broker/finder's fee of some sort. If they pass, I would tell them that you plan on acquiring the domain for your portfolio, making sure it's all in writing/email. [/QUOTE]
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