Bob Parsons Explains Go Daddy – KKR Deal to Domain Name Wire
Friday, July 1st, 2011
Investment makes 36 millionaires, will help company expand overseas and acquire complementary businesses.
I just got off the phone with GoDaddy.com founder Bob Parsons, who explained the deal his company just struck with KKR, Silver Lake, and Technology Crossover Ventures.
Contrary to reports in publications such as The Wall Street Journal, this was not an outright acquisition. Parsons remains the single largest shareholder in the company in what he terms a “partnership”.
Before the deal Parsons owned 78% of the company and employees owned 22% through stock options.
Both Parsons and the employees benefited from the investment, with 36 employees getting $1 million plus checks.
All of the senior management invested in the deal and a number of people with options rolled some of it into stock in the company.
Why not just sell the company?
“I’m not dead yet, Andrew,” Parsons told me. “The reason I’m the single largest investor is because this is what I eat, sleep, and breathe.”
Parsons will remain with the company as Executive Chairman of the Board and company president Warren Adelman has been promoted to CEO.
“We cut a smokin’ deal with KKR, Silver Lake Partners, and Technology Crossover Ventures,” said Parsons. But it isn’t just about the money, he said. “What excites me is what they bring to us as a competitor.”
He explained that the investors’ experience in overseas markets and technology will help the company grow. The company may also make acquisitions, such as to help the company offer a greater range of cloud based services.
“If I could pick three companies out of the blue [to partner with], these are the guys I’d pick,” he said.
Parsons would not disclose the amount of investment, but when I asked him about reports of $2.25 billion he said “it might be close”.
Further Reading:
- Breaking: Go Daddy Takes Investment from KKR, Silver Lake, and TCV
- Done deal: KKR, Silver Lake & TCV now part owners of Go Daddy
- Go Daddy CEO Bob Parsons Buys Cher’s House
Tags: bob parsons, go daddy, godaddy.com
Breathe, not breath.
@A. itchell
.com not .tel
wow, cool info and insight Andrew… direct quotes from the man himself, nice
36 newly minted millionaires… that’s awesome and big congratz to them
Wow, congrats. It looks like Parsons bagged an elephant.
@Tim .tel is my Nam.
I suspect some of them were millionaires already, but they got another check for at least a million.
Thanks @ A. Mitchell
great reporting Andrew
Great story, thanks for the details.
Hi Andrew,
Great work… AAA+ work and reporting!!!
Cheers!
‘D’
Yep, another million+ check will not hurt.
I just hope customers do not suffer , seen such big sell ,in the past non went fine for the customers.
Andrew, thanx, you always come out with relevant posts.
Andrew
Interesting.
I could swear I remember someone asking Mr. Parsons at DomainFest, if he owned the company himself and he answered that he owned 100% of the company all the shares of stock.
I remember having a conversation with some people after surprised to hear that none of his staff had ownership, maybe in retrospect not the most truthful answer at domainfest
Anyone
@ Michael -
He owned 100% with no outside investors. 22% had ownership but mostly/all through options.
I suspect his answer at DOMAINfest was probably in relation to no outside investors. Or it may have been b/c the employee stock was just options.
HOW may Bob Parson reinvest that money? maybe, in a new.space company, as done by Elon Musk and Richard Branson?
” $2.25 billion ”
If you believe that, I have a bridge to sell you
LOL
“I’m not dead yet.”
Sadly for the magnificent animals Bob enjoys killing, they can’t say the same.
ps Thanks Andrew for more great, original reporting.
Our industry wouldn’t be the same w/out you.
Good for bob bad for every one else.
Andrew why do so many other blogs keep writing Go Daddy sold and Bob no longer has control of his company ?
@ RH – Bob’s still the largest single shareholder, but the majority of the company was sold.
Great strategy for godaddy. It’s a smart move.
I’m glad they didn’t sell.
OK maybe I misunderstood your post because every other place says GoDaddy sold!
I’m glad they didn’t sell. I misunderstood your post because every other place says GoDaddy sold!
I’m curious as the Wikipedia entry as well as The Wall Street Journal are reporting that The Go Daddy Group Inc was indeed sold. How can you justify rehashing the GoDaddy.com press release and calling it “news”?
It’s not a “partnership”, as far as I can see. Perhaps Bob Parsons remains the largest shareholder, but I’d like to know what his percentage goes down to and what percentage the other new private equity investors (KKR, Silver Lake and TCV) now own. Can you do some digging, Andrew, and post a follow-up comment?
Thanks,
Doug
Doug – the term partnership is a stretch, but it seems more like they “invested” in Go Daddy rather than bought it.
That said, in deals like this often times a new entity will be created, in which case you might say they bought it and then Bob Parsons “bought” a large share of the new company.
It’s a tough environment for getting credit for acquisitions, even for firms at GoDaddy’s revenue level. This deal would seem to capitalize the business so Bob can go bag some cloud businesses or overseas registrars or get in deeper on the mobile market.
To state the obvious, these are A list private equity firms he’s in with now, so I would expect to see some major strategic moves in the near future.