Not always. Dropbox did the same thing, and I thought it was smart. Couple of factors: 1) Time-value of money. Say they could have gotten it for $30k before t

Not always. Dropbox did the same thing, and I thought it was smart. Couple of factors: 1) Time-value of money. Say they could have gotten it for $30k before they started vs $1 million later. $30k when you're starting up can be "worth" more than $1MM when you're already killing it. 2) If you get big (like Dropbox) you own the namespace anyway. So even though the current owner has leverage over you (they have the only domain you want), you have leverage over them (you're the only potential buyer). 3) High chance the startup won't work out anyway or you'll want to pivot. Keep the cost of rolling the dice low. The alternative is to give your product a less than ideal name. I think that's often a bad trade off which will be more painful to change later than acquiring the domain.