
GoDaddy is Going Public - bhartzer
http://fortune.com/2014/06/09/godaddy-ipo/
======
sayemm
Bob Parsons has an interesting life story:
[http://en.wikipedia.org/wiki/Bob_Parsons](http://en.wikipedia.org/wiki/Bob_Parsons)

\- Grew up poor, flunked high school, enlisted in the Marines during the
Vietnam War

\- Graduated from college, self-taught programmer at age 25

\- Started Parsons Technology at 34

\- Grew it to 1,000 employees and sold it for $64M at 44

\- Started GoDaddy at 47

\- Exited Godaddy in 2011 for $930M at age 61
([http://www.bizjournals.com/phoenix/blog/techflash/2014/06/go...](http://www.bizjournals.com/phoenix/blog/techflash/2014/06/godaddy-
files-for-100-million-ipo-bob-parsons.html))

Great entrepreneurs never develop overnight, this game only gets better with
age.

~~~
uptown
You skipped the chapter where he killed the elephant.

~~~
duaneb
I'm no fan of poachers, but it's pretty irrelevant to his business career. In
fact I'd put money down that there's a positive correlation between successful
entrepreneurs and psychopaths.

~~~
ansimionescu
You'll probably have a blast reading this (I know I did):

[http://www.ribbonfarm.com/2009/10/07/the-gervais-
principle-o...](http://www.ribbonfarm.com/2009/10/07/the-gervais-principle-or-
the-office-according-to-the-office/)

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RexRollman
GoDaddy's advertising is horrible and their policies are questionable. I
personally find myself hoping that the IPO doesn't go well.

~~~
Shivetya
I guess I need to learn to take offense easier, however with two personal
sites maintained for family members both registered through GoDaddy I honestly
never had a single issue. So what am I missing?

~~~
RexRollman
[http://en.wikipedia.org/wiki/Go_Daddy#Controversies](http://en.wikipedia.org/wiki/Go_Daddy#Controversies)

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jhonovich
They are losing money... and lots of it. Wow.

GoDaddy has been around a long time, one would think they would be profitable
(at least barely) by now. And they are going public with this?

~~~
beambot
How did they get into a situation where they're losing >$200M per year -- and
with only $100M cash in bank and $1B revenue? Even more perplexing... they
recently took on $1B+ in debt, of which they immediately paid out 30% as a
dividend to investors?!

I'm not an expert or anything... but their "growth" story stinks; it looks
like they're just trying to milk a dying cow. That, or I'm just way off
base...

~~~
gerbal
This smacks of a firm being raided by private equity funds. Leverage, debt use
it to do a stock divident to the owners (Private Equity firms), launch an IPO,
use the IPO funds to finance more debt, keep the company above water long
enough to walk away.

Also the current CEO is a former Yahoo! exec, not exactly confidence
inspiring.

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seancoleman
Direct link to GoDaddy's S-1:
[https://www.sec.gov/Archives/edgar/data/1609711/000119312514...](https://www.sec.gov/Archives/edgar/data/1609711/000119312514230425/d728713ds1.htm)

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steve_benjamins
We have 50 reader reviews of GoDaddys website builder at Site Builder Report.
Of the 50 reviews, 48 have received the lowest possible rating (1 star out of
5). [http://www.sitebuilderreport.com/reviews/godaddy/user-
review...](http://www.sitebuilderreport.com/reviews/godaddy/user-reviews)

No other website builder we cover is the target of as much outrage from
readers.

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marincounty
I found there S-1 Registration statement insiteful--especially about
competition, and how domain names are not as important as they used to be. I'm
a customer of Godaddy because I'm a sucker for a bargain(99 cent names). I
think the company would benefit if they stoped trying to outwit their
customers; like stop changing the renew automatically, and don't assume I want
to spend more than 1 year with you. Oh yea, we all know Godaddy is the big
daddy in domain names--you don't need to spend countless millions on eye
candy. I understand spending a lot on advertising in emerging markets, but not
in the U.S.--pass those saving on to your customers. Yes--I know the Super
Bowl ad put you in the game, but we know the system now--we know what you do,
and when we are being gouged. My final thought is this, if you want repeat
customers--stop playing tricks like pricey privacy options, holding domains
hostage because they are a day late in payment, and constantly changing
automatic billing settings. Bye--

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adwf
Surely it's a little late for an IPO from GoDaddy. They've been around for a
long time, they're already established as a market leader, there'll be little
to no hype.

Forbearing a massive success with the new TLDs that seem to be given out like
candy, I can't see any huge growth areas for them to move into. Maybe China,
but that's always going to suffer from preferential treatment to incumbent
local competition. (If the Chinese allow free DNS registration at all?)

The only way I'm seeing this is that the owners want to sell, but the
financials are so bad they couldn't find a private buyer. I'll give it a pass
unless anyone knows different?

~~~
bhartzer
Bob Parsons pulled the IPO back in 2006 because of market conditions:
[http://www.bobparsons.me/archive_article.php?entry_id=121](http://www.bobparsons.me/archive_article.php?entry_id=121)

~~~
adwf
Thanks, that at least explains why they're IPO'ing so late. Still not enough
to convince me it's a good buy though :)

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gerbal
I had assumed GoDaddy was already public. Seems like the sort of company that
would have gone public ages ago when it was still growing aggressively.

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bhartzer
I think they have a few things to fix before they go public, like the insane
amount of money they've been spending on marketing.

~~~
Stormcaller
Does it not work though? They are known for being shitty yet they are one most
popular(if not the most[1])

With this bad reputation and even some boycotts like "leave godaddy, they
support sopa" it is obvious they don't have a good reputation and their
service is "good enough to not bother switching"

I don't think they'd grow without massive marketing.

[1] I dont know how accurate this data is, although it doesn't look too far
from truth [http://www.webhosting.info/registrars/top-
registrars/global/...](http://www.webhosting.info/registrars/top-
registrars/global/?pi=1)

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larrys
"The self-described “outspoken” executive called the quiet period
“suffocating” and didn’t want to give up his weekly radio show, or other
planned radio and TV appearances."

Oh sure, right. As if he didn't know that when he got involved in the process
and hired investment bankers.

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hacknat
Given who owns the company now, I'm pretty sure that they'll be looking for
acquisitions to tack onto their upsell activity. Pretty sure that's what this
IPO will do. GoDaddy will be buying some companies in a year.

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itchyouch
I remember reading about how private equity takes companies and leverages them
for a handsome payout, only to dump them in an IPO to let the public assume an
untenable balance sheet.

1B in revenue on 1B in debt...its right at the limit for healthy.

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sturmeh
How do I purchase put options for an IPO?

~~~
gibybo
The regulatory body that governs options restricts them for IPOs. There is a
period of time (I believe it's 2 weeks) after IPO that options are not allowed
to be traded in public markets, so you have to wait until then. At that point,
you can buy puts from any full service brokerage (and many discount
brokerages).

If you are a sufficiently high net-worth individual or investing on behalf of
a sufficiently large fund, you may be able to make a private deal with one of
the investment banks participating in the IPO, but I don't know much about
that.

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zacharycohn
Does that mean they have to stop being awful at PR (shooting elephants,
objectification of women, etc)?

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jacquesm
For some companies an IPO is the final frontier just before they really start
to cook. For others it is the final round in a game of pass-the-buck.

My hope is that it is the former, my fear is that it is the latter.

Even Facebook eventually ended up above their IPO price so maybe GoDaddy won't
do so bad. Give it a few years.

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dillon_easyeda
I changed from GoDaddy to domainsite 5 years ago.

~~~
atm32s4
Me too, it seems domainsite is acquired.

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Theodores
Why are companies like GoDaddy allowed to just lose hundreds of millions of
dollars every year? I don't get it!

The cheap domain thing is not a capital intensive industry, there are
thousands of IT companies that can sell you a domain out there, it is not as
if you need a factory or hundreds of thousands of staff to get into the
business, so cheap isn't necessarily going to get you into a monopoly position
- e.g. de Beers - so that they can have the market to themselves.

If they were making cars instead of domains and selling everything at what
amounts to a loss year in, year out, some EU type of organisation would come
along with an anti-dumping tariff to put an end to it.

Why is it with tech companies that GoDaddy style business models are allowed
to persist? Sure some of those losses are due to acquisitions, but, again, why
can companies that don't make money allowed to buy up companies that do make
money?

~~~
djloche
In case you are serious about not getting it: you can operate at a loss in a
number of situations: if you have profits in reserve, if you have available
credit to float the difference in revenue, or a combination therein. You
cannot bleed forever, only as long as you have capital to push onward. If you
have access to a ton of credit, or have a ton of money in the bank, you can
take losses for quite some time.

I haven't looked too deeply at their internals, but some companies choose to
(properly) mark down existing assets or investments on their books to current
market value at certain times for strategic tax purposes. Eg. if you have a
warehouse full of stuff you can't sell, but profit from other divisions the
right thing to do is to write down those assets to market value (sometimes
that is zero, but not always)

