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Go Daddy sale to make Bob Parsons a billionaire

Kevin Murphy, June 26, 2011, 08:55:45 (UTC), Domain Registrars

Number one domain name registrar Go Daddy is in talks to sell out to private investors in a deal worth north of $2 billion, according to reports.

The deal, first reported by the New York Post and subsequently confirmed by other newspapers, would see the company acquired by a group led by Silver Lake Partners and KKR & Co for between $1 billion and $2.5 billion.

An official announcement could come as soon as Tuesday, these reports said.

Go Daddy has been subject of exit strategy rumors before, notably late last year, and it came to nothing, but this time it’s looking like a done deal.

The company also attempted to go public in 2006, but its IPO was yanked due to poor market conditions and other reasons.

In fact, IPOs appear to be the exception rather than the rule when it comes to domain name registrars.

Register.com did go public, but it didn’t work out too well and it was reprivatized. Network Solutions also wound up in private hands. Demand Media listed last year, but eNom is not its core business.

For many, Go Daddy is synonymous with its flamboyant chief executive, Bob Parsons, who founded the company in 1997 with the proceeds of a previous technology company sale.

As the company’s primary shareholder, the sale will likely make him a billionaire. The question is: as a serial entrepreneur, how long will Parsons stick around?

He’s a pretty good businessman, to be sure, but he’s never struck me as somebody who’s particularly passionate about the domain name industry.

I expect he’ll stick around for a while to groom his successor after the sale closes – it may even be a condition of the deal – but I’d be surprised if he’s still at the helm two years from now.

I understand there are also a number of senior Go Daddy executives with share options; we’re likely to see these guys on the receiving end of windfalls if the deal goes through.

I’ll also be interested to see how new ownership will affect Go Daddy’s philanthropic work.

The company does not like to talk about it (more than three or four times a month) but it does contribute a fair bit to charitable projects.

I don’t think new management will attempt any kind of drastic shake-up of Go Daddy’s business model, such as raising prices, in the short term.

The company has a winning formula that is not in need of fixing right now.

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Comments (4)

  1. Michael says:

    I think that this sale won’t make huge effect to domain investors or domain registry business, because it is not merge of some two large companies, it will be the same company with the same size, same employees and everything

  2. Domain Lords says:

    Come on the IPO of NetSol raised BILLIONS for the top spooks of the CIA that ran it. SAIC was the mother company of network solutions the first registrar, they OWNED the net from 1994 or so until they went public then Icann was allowed to let others in the game. The groups running the registrars aren’t clean enough to do IPO’s if you know who owns them. GD is probably the top registrar now, but the main IPO was NETSOL and for you to not even mention them shows you know no history of the net.

  3. Nic says:

    This is good for the domain industry.

    “Private equity” (KKR) will screw it up and GD will loose share.

    Perhaps they will change GD’s stupid name, change it’s dreadful logo, and change it’s awful marketing strategy (girls and cars), ie all the things that have made the business SOOO successful.

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