GoDaddy - Are they making money?

[Embrand]

Sorry if this has been discussed before - couldn't find anything.

I am wondering how Go Daddy are doing financially. Because it is a private company, so no financial statements available I guess?

Of course, Bob Parsons seems to be on top of the world. But so did that Enron guy :lol: And if Go Daddy crashes, 30 million domains need a new home...

Anyone have some inside information?

 

[sumo123]

Does not have any information but eager to know.

 

[RJ]

Their financials were made public in 2006 when they were filing an IPO. They lost money every year between 1997 and 2006. I doubt much has changed since then.

Links

http://www.bobparsons.tv/WhyIPOPulled.html

http://www.thestreet.com/story/10302695/1/go-daddy-yanks-ipo.html

 

[Embrand]

Their financials were made public in 2006 when they were filing an IPO. They lost money every year between 1997 and 2006. I doubt much has changed since then.

Links

http://www.bobparsons.tv/WhyIPOPulled.html

http://www.thestreet.com/story/10302695/1/go-daddy-yanks-ipo.html

Thanks - interesting! But not very comforting... I really hope they are doing better these days.

 

[weblord]

We don’t have to go public.
The Go Daddy Group, Inc. has one investor: Me. The tech companies we have witnessed complete the IPO process and actually go public during this difficult time have all depended on venture capitalists, both on their board and as their investors. The principals in these companies have made it no secret that given the choice, they would have much preferred not to go public. They proceeded with their offerings only because these venture capitalist investors made them to do it.

Why would venture capitalist investors do such a thing? It’s quite simple. They need to flip their investment to show a gain for whatever fund it is they are managing. If the underlying company takes it on the chin as a result, then so be it.

That’s not going to happen to Go Daddy.

To date, Go Daddy has been completely self-funded –we have been cash flow positive since October 2001, and – whether anyone has noticed or not — continue to generate healthy cash flow from operations. We’ll manage just fine without the IPO money — thank you.

 

[PowerUp]

Their financials were made public in 2006 when they were filing an IPO. They lost money every year between 1997 and 2006. I doubt much has changed since then.

Links

http://www.bobparsons.tv/WhyIPOPulled.html

http://www.thestreet.com/story/10302695/1/go-daddy-yanks-ipo.html

Wow, the biggest registrar and they still lose money? It's not easy being a registrar I guess.

 

[Kate]

We don’t have to go public.
The Go Daddy Group, Inc. has one investor: Me.

I knew it was a one-man show :lol:

Wow, the biggest registrar and they still lose money? It's not easy being a registrar I guess.

It has to do with their business model. Growth vs profitability.

 

[Weber]

Most likely, it was pulled because pre-ipo polls didn't indicate enough interest to get the initial price per share that they wanted.

 

[cache]

in RJ's link, godaddy explained the reason it is not profitable:
"We are required to show income on domain names – as if our customers pay for them monthly over the life of the registration.
Because we sell domain name registrations, we must recognize the income we earn on each domain name over the term of its registration. For example: if a customer registers a domain name with us for three years, we must show the income earned over the three year period. However, all of the salaries, advertising, systems and overhead costs associated with getting that domain name registration are recorded and expensed on the day the registration is sold. As a result we defer most of the income we make on every domain name until way into the future.
The fact is our customers pay for registrations in advance, registrations are non-refundable and after recording the registration our job is pretty well done."

So does this mean godaddy will have accelerated earning in the future?

 

[PowerUp]

in RJ's link, godaddy explained the reason it is not profitable:
"We are required to show income on domain names – as if our customers pay for them monthly over the life of the registration.
Because we sell domain name registrations, we must recognize the income we earn on each domain name over the term of its registration. For example: if a customer registers a domain name with us for three years, we must show the income earned over the three year period. However, all of the salaries, advertising, systems and overhead costs associated with getting that domain name registration are recorded and expensed on the day the registration is sold. As a result we defer most of the income we make on every domain name until way into the future.
The fact is our customers pay for registrations in advance, registrations are non-refundable and after recording the registration our job is pretty well done."

So does this mean godaddy will have accelerated earning in the future?

Lets assume I prepay my registration for 10 years. But in the 3rd year, I transfer my domain from GD to another registrar. Will GD also transfer to the new registrar the money I paid for the balance 7 years, or will GD keep the money himself?

 

[domainer50]

Wow, the biggest registrar and they still lose money? It's not easy being a registrar I guess.

Im sure paying for those million dollar super bowl ads isnt helping But I do believe that if we were to see their financials today, it would be different. That is just :imho:

 

[ecigs.net]

What?

We don’t have to go public.
The Go Daddy Group, Inc. has one investor: Me. The tech companies we have witnessed complete the IPO process and actually go public during this difficult time have all depended on venture capitalists, both on their board and as their investors. The principals in these companies have made it no secret that given the choice, they would have much preferred not to go public. They proceeded with their offerings only because these venture capitalist investors made them to do it.

Why would venture capitalist investors do such a thing? It’s quite simple. They need to flip their investment to show a gain for whatever fund it is they are managing. If the underlying company takes it on the chin as a result, then so be it.

That’s not going to happen to Go Daddy.

To date, Go Daddy has been completely self-funded –we have been cash flow positive since October 2001, and – whether anyone has noticed or not — continue to generate healthy cash flow from operations. We’ll manage just fine without the IPO money — thank you.

Please explain what you mean?

 

[interestedenough]

One thing I do like about their business model is that they are squeezing a good amount of money out of the drops while making them available at their TDNam site. In my mind, where they fail is in trying to make TDNam available to a wider audience.

 

[Constantin]

So does this mean godaddy will have accelerated earning in the future?

They will also have accelerated spendings in the future: oil gas is increasing, rent, salaries, all these spendings are increasing also.

 

[shockie]

Lets assume I prepay my registration for 10 years. But in the 3rd year, I transfer my domain from GD to another registrar. Will GD also transfer to the new registrar the money I paid for the balance 7 years, or will GD keep the money himself?

godaddy will keep it.

your total registration length will just be 11 years, godaddy keeps 10 years, and the winning registrar gets 1 year.

 

[xman]

We don’t have to go public.
The Go Daddy Group, Inc. has one investor: Me. The tech companies we have witnessed complete the IPO process and actually go public during this difficult time have all depended on venture capitalists, both on their board and as their investors. The principals in these companies have made it no secret that given the choice, they would have much preferred not to go public. They proceeded with their offerings only because these venture capitalist investors made them to do it.

Why would venture capitalist investors do such a thing? It’s quite simple. They need to flip their investment to show a gain for whatever fund it is they are managing. If the underlying company takes it on the chin as a result, then so be it.

That’s not going to happen to Go Daddy.

To date, Go Daddy has been completely self-funded –we have been cash flow positive since October 2001, and – whether anyone has noticed or not — continue to generate healthy cash flow from operations. We’ll manage just fine without the IPO money — thank you.

It's good to know that we have GoDaddy representative here at NP.

So I guess you will be able to answer all the concern and question that we may have about your company.

 

[smashfactory]

godaddy is doin just fine-

bobs earrings are real gold ya know

 

[domainer50]

godaddy is doin just fine-

bobs earrings are real gold ya know

If you were Bob, and you had all those Godaddy girls around you all the time, would you be concerned? lol

 

[TheBulldog]

Ha, godaddy is just fine.

Parsons is exactly right, you show sales as this year, you write them off for the length of the "contract" keeping them alive.

 

[tech4]

Good thread, I was looking for some information like this. Just saw how greedy verisign was in their pricing structure for dot com, since it has the highest presence on the web with about 70 million names. They charged it at a minimum of $6.42 per name. Looks like the margin here is very low for dot com only. However margins for dot net is higher since its only charged $4.85 (most registrar chareg 6.99 per dot net a healthy margin of $2.14/net or 44% over that $4.85.

Overall, I noticed dot Asia descrepcies and other tlds which has a higher margin as much as 44% like the dot net and even more. So the business is not about creating low prices, its more about marketing to customers. From reading Bob's blog about the IPO, it looks like he's making gold for real. Not losses.

Looking at his pricing structure, it looks profitable. However I don't really know if it is.