Godaddy.com up for sale. Could fetch $1 Billion

http://online.wsj.com/article/SB10001424052748703597204575484153733196856.html?mod=djemalertNEWS

by atentaten • 16 years ago

94 54 16 years ago

online.wsj.com

mkramlich3• 16 years ago

I'd offer $9 for just the domain name.

snissn• 16 years ago

maybe you could register it with ..

mkramlich3• 16 years ago

humor folks. and on-topic. lighten up!

mkramlich3• 16 years ago

that's sad. the voting system is broken. i recommend only allowing admins to bring any comment below 1 point.

kierank• 16 years ago

Godaddy always struck me as the Ryanair of domain names. A company that you didn't need to love as long as they did what they said on the tin.

leftnode• 16 years ago

They also remind me of Paypal: you can use them fine for years and years, and then one day they totally fuck you over.

Mind you, I probably have 50+ domains registered with GoDaddy, I've just read some horror stories too.

KrisJordan• 16 years ago

Surprising to read between 800-900M 2009 revenue and a price tag of 1B.

hristov2• 16 years ago

Well, revenue is not profits. It would be interesting to see what their actual profits are. For one, they spend a lot of money on advertising.

qeorge2• 16 years ago

I would think their profit margins are huge, though you're right, they do spend a ton of money on ads.

IIRC, registrars pay on the order of 25 cents a domain, which they then resell for $8 or more, and GoDaddy is the registrar for something like 1/4 of all .coms. Web hosting and email are very high-margin too.

asanwal2• 16 years ago

Agreed. That's a price/sales ratio slightly over 1. Salesforce.com has a price/sales of over 10.

Different biz I know but both are ultimately subscriptions.

hyperbovine• 16 years ago

GoDaddy is a go-between. Salesforce is not.

trevorcreech• 16 years ago

Wait, is the whole company for sale, or just the domain name?

newsisan• 16 years ago

Not sure why you were downmodded, I'd like to know this as well, and it certainly relates to this thread.

code_duck• 16 years ago

Probably because the answer could be found easily in the article. However, there's a possibility the intent was to just question the accuracy of the title?

robinhowlett• 16 years ago

The whole company. From the WSJ:

"Qatalyst Partners, the boutique firm run by veteran technology banker Frank Quattrone, has been hired to shop the Go Daddy Group Inc. ..."

duck• 16 years ago

The company - hired to shop the Go Daddy Group Inc

On a completely different note, just noticed that WSJ injects a link when you do a copy/paste from their site:

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jplewicke• 16 years ago

Probably using Tynt - http://www.tynt.com/ .

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dcurtis• 16 years ago

I wonder what is keeping them from doing an IPO. Selling a company as large and as profitable as GoDaddy at a public auction seems very strange.

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hristov2• 16 years ago

Well first of all it is unlikely to be a public auction. It will probably be a private one organized by a various investment banks.

And I think it does make some sense, especially in these days when private equity is so well developed. The stock market likes growing companies, and I am not sure whether they would like GoDaddy which seems to be reaching the limit to its growth. Also, the stockmarket does not like situations where the owner is cashing out, and much prefers companies that sell stock mostly to re-invest in their business. If Godaddy did an IPO, the owner would not be able to cash out immediately and would have to wait a while and sell his stock slowly and hope he does not cause a collapse in the price.

Private equity specializes in these situations (owners wanting to cash out, and companies that may have plateaued or are in decline), so it seems like a good choice.

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adharmad• 16 years ago

Isn't going public just another sort of a public auction?

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dabent2• 16 years ago

They did try an IPO a while back and decided not to go through with it. Bob Parsons blamed the way accounting rules worked with his business and SOX if I recall correctly.

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emmett• 16 years ago

The high cost of being a public company under our current laws, perhaps.

http://www.cfo.com/article.cfm/7075161?f=search

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_delirium• 16 years ago

The numbers there don't seem nearly high enough to determine a decision like this. I think it'd take a lot more than an expense equal to 1-2% or so of revenues to cause someone who was going to IPO to go the other way.

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annajohnson• 16 years ago

The reason may be as simple as Bob Parsons not wanting to run the business anymore...

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luffy• 16 years ago

Leveraged Buyout (LBO) city, baby!

Prediction: a firm like KKR or Carlyle buys GoDaddy and borrows a bunch of money (> $10B ?) on the cheap, and then uses GoDaddy's revenue to service the debt.

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loganfrederick• 16 years ago

Why would KKR need to borrow $10B? They could get away with $1B, and probably less than that if they use some cash.

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brc• 16 years ago

That's easy to answer : they don't like using their own cash.

The returns are infinite if you don't use any of your own money.

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zackattack• 16 years ago

I have all my domains registered with them. Despite the fact that I'm registering a few domains a month and they obnoxiously upsell me every time, I've gotten used to them and they have decent customer support that's always been available for me, as well as rad coupons ($7.49+fee domains). I hope the sale doesn't change things up too much. When my previous web host, aSmallOrange got bought, their service became inconsistent, frustrating and all-in-all horrible so I switched to HostGator and have been thrilled ever since (24/7 live chat is great!).

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jacoblyles• 16 years ago

Don't forget that they park spam pages at your domains if you haven't set the DNS yet. So make sure you redirect your arbitrary sub-domains.

I hate GoDaddy and all that they stand for. I'll never do business again with such a spammy company, even if it means paying $2 more a year with someone else.

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abalashov• 16 years ago

Considering ASmallOrange was bought by Hostgator, I find your story about the switch ... surprising.

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rwhitman• 16 years ago

Bob Parsons is a crazy/interesting dude thats for sure... The complete polar opposite of any silicon valley CEO.

I don't get nor agree with most of what he does but I find it fascinating.. Has anyone else seen his blog? The irony is even though his video blog series - he and a busty blonde giving advice with cartoonish editing usually featuring motorcycles in some way - looks ridiculous its actually really smart, useful information

Doesn't surprise me he'd prefer to exit with an auction instead of IPO

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jhghjnmmn2• 16 years ago

It does strike me as a very low barrier to entry business. Amazon could sell domains for 1$ more than versign charge them.

Google could bypass verisign completely and launch their own top level domain with their own root DNS and give away ".go" domains.

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sandeepshetty2• 16 years ago

That could be likely with the introduction of the New Top-Level Domains: http://www.newtlds.tv/newtlds/ http://en.wikipedia.org/wiki/GTLD#New_top-level_domains

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jhghjnmmn2• 16 years ago

The point of the internet is that somebody with enough servers and their own browser could easily introduce their own TLDs.

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Kilimanjaro• 16 years ago

I like the .go idea, sounds interesting and worth analyzing.

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bl4k2• 16 years ago

Here is a company, that since its inception, has done the exact opposite of what is published in business and entrepreneurship papers and has succeeded to great effect.

Explain that.

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nostromo• 16 years ago

Price. Domains are a commodity. Back when Godaddy took off, they had the cheapest reliable service.

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dabent2• 16 years ago

I'm not sure what you mean by doing the exact opposite. The founder, Bob Parsons, built something people wanted - a cheaper way to get domain names. His marketing tactics are, um, a bit different from most online/tech companies, but he's built two successful companies from the ground up using tactics from direct marketing.

This time, Parsons acted as his own angel investor burning through millions from his first company, but seems to have acted rather frugally while building his business. His first was bootstrapped from home while he worked a day job. His persistence and determination are remarkable.

Parsons is an outlier because he's built both companies outside of Silicon Valley with no funding but his own, no degree from a big-name school, but just drive and guts. I think that's why his businesses look different that what we normally see. They grew in a different ecosystem and seem like an alternate species on the outside, but inside they still operate much like other companies.

If you want to know more details about how he did it, read his blog or listen to his older podcasts (if you can find them). He's a shameless self-promoter who doesn't mind telling his story.

But do know that his recent video podcasts are just garbage. After the Super Bowl commercial that put GoDaddy on the map, he's apparently decided that buxom females are the only thing that matters and has gone all the way with it. His earlier audio podcasts were actually more like Mixergy, where he'd talk to young entrepreneurs about how they did it and share his own stories. His story helped inspire me to work on my first startup.

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MC272• 16 years ago

By bombarding customers with page upon page of cross selling options.

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jonursenbach• 16 years ago

Here's to hoping that the future owners drop those ridiculous TV ads.

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hagy• 16 years ago

I thought about this a while a back, and as ridiculous as their TV ads are, I do believe they serve a purpose: getting members of the general public to start with go daddy when they want to create a website. I’d wager a significant portion of their revenue isn’t from domain registration, and instead from all the extra services they offer, and first-timers are likely the main customers of these services. As ridiculous as the commercials are, they do get the general public's attention and drive first-timers to go daddy’s services.

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hysterix• 16 years ago

If godaddy can fetch that much, I would sell it as well; I say bravo to that man.

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pontifier• 16 years ago

I used to have over a hundred domains with them, but they canceled one of my favorite domains because THEY didn't charge my debit card. The domain was set to auto-renew, and there was money in the account... They lost me for good.

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Godaddy.com up for sale. Could fetch $1 Billion

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