I talk to a lot of people about ideas for new businesses. In the initial brainstorm, they often start thinking about domains for their website. In the past I too have been guilty of purchasing a domain before making any other progress on the website itself. (I was once the proud owner of itaintshit.com and unseencavaliers.net. Don’t ask.) This puts the cart before the horse, when all you really need is the horse to get where you’re going. In other words, domains don’t matter. (Much.)
Sure, you should own your identity, if at all possible. I have an uncommon first/last name combination, so it’s pretty easy for me. But what about your startup? If you’re thinking of starting a collectibles website devoted to all things Chewbacca, should you rush out and purchase chewbacca-collectibles.com, .net, .org, .biz, .us, etc. etc.? At $10-$35 per year for each domain, that could get expensive. And who knows, maybe by the time you’re ready to launch, you’ll have realized that you have a lot more to offer than Chewbacca collectibles. You may want to expand into Greedo and Jar-Jar Binks knickknacks, and now all those chewbacca-collectibles domains are a sunk cost.
I believe the domain purchase can be close to the last step in the process. Get a functioning website going, then commit to a domain. And don’t bother negotiating purchase of a domain that someone else owns—it’s not worth it. Find a reasonable alternative that is available from one of the registrars (I use GKG.net). There are many successful websites—including the top marketing blog—that don’t even bother with catchy domains.