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This may be the biggest domain name sale ever. According to the Wall Street Journal, Go Daddy Group, Inc. which owns GoDaddy.com – the world’s biggest domain name registrar – is offering itself for sale in an auction that could see the company sold for more than $1 billion.
Go Daddy has hired technology banking firm Qatalyst Partners – led by iconic banker Frank Quattrone – to handle the sale. According to the Wall Street Journal, private equity firms are likely to be the prime bidders for the company, attracted by the consistent, and consistently large, cash flows GoDaddy.com generates on an ongoing basis.
GoDaddy, which is based in Scottsdale, Arizona, was founded by eccentric entrepreneur Bob Parsons back in 1997. Since then, while the Internet bubble rose and burst, and while the technology media focused most of its attention on ‘sexier’ Internet companies – ranging from Amazon and eBay, to Yahoo and Google, to Facebook and Twitter – GoDaddy steadily became the leading domain name registrar, with over 43 million domain names under management.
Go Daddy hasn’t exactly been a ‘quiet’ achiever – its outspoken founder and CEO Bob Parsons has relished media attention and the company is known for his infamous TV commercials featuring the ‘Go Daddy Girls’. Nevertheless, it still shocks me how both GoDaddy and Bob Parsons have garnered so little attention among the technology media.
Dare I say it might have been a different story had Bob Parsons started Go Daddy in Silicon Valley with venture capital, instead of building it in Arizona with his own money?
GoDaddy is also well known within Internet marketing circles for embracing and capitalizing on a range of innovative and lucrative conversion tactics. The company is one of the leaders – if not the leader – in attracting customers with cheap domain names (arguably loss leaders), and then up-selling and cross-selling them into buying a host of other services.
To this end, apart from being a domain name registrar, GoDaddy.com sells website hosting, website creation tools, security solutions, e-commerce services, domain parking, runs a domain name aftermarket, and has just introduced its X.co URL shortening service (see Go Daddy Launches X.co World’s Shortest URL Shortener).
According to the Wall Street Journal, all this adds up to an estimated $750 million to $800 million in 2009 revenues for Go Daddy Group, Inc.
So why is Bob Parsons selling GoDaddy? I can only speculate, but the fact that Go Daddy is seeking a private sale rather than, say, go public by filing an initial public offering (IPO) indicates that Bob Parsons doesn’t just want to cash out. It says to me that he no longer wants to run the business.
That’s fair enough and kudos to Bob Parsons for building GoDaddy into such a successful company. All the same, I have mixed feelings about the Go Daddy sale and, I presume, Bob Parsons’ exit from the company.
Okay, I’ll admit it: I have ‘Bob Parsons’ 16 Rules For Success‘ poster above my desk. Go Daddy is the classic entrepreneurial success story and I’m a bit sad that the company is going to be sold to a bunch of bankers (if that’s what happens)!
On the other hand, in case the domain name industry couldn’t get any more interesting, it just did. Which makes this industry all the more fun to be involved in. Watch this space.
Source: Anupreeta Das, “GoDaddy.com Goes on the Auction Block,” WSJ.com, September 11, 2010
Original article by Anna Johnson (Kikabink News)
