Demand Media contemplating IPO — which could mean an open book on the company.
Financial Times is reporting that Demand Media is exploring an Initial Public Offering and could file as early as August.
Demand Media is a fascinating story. What started as a domain startup quickly acquired eNom and Bulk Register, then found itself creating content through a massive and efficient supply chain.
As when any company files to go public, an S-1 from Demand Media would show us a lot about the inner workings of the company, including subsidiary eNom.
When Go Daddy filed to go public (it later ditched its plans), we learned a lot about its profit centers and operations. It also connected the dots to its Standard Tactics subsidiary.
When NameMedia filed to go public (it also ditched its plans), we learned how much it paid for a number of its acquisitions.
A Demand Media filing could potentially tell us:
-Details of eNom’s partnership with Network Solutions for NameJet
-How many domains the company owns and the parking revenue it makes
-Revenue or operations of Acquire This Name
-How much it paid for domain parking company HotKeys and for its other acquisitions
Andrew,
What happens if they signed non-disclosure agreements related to acquisitions? What takes precedent?
@ Domain Investor – generally speaking they’ll still have to report it in the S-1 I believe…as long as it was material.
@ Domain Investor – to follow up…in Name Media’s case it disclosed its Google and Yahoo contracts but redacted the percentage payouts. It disclosed all of its acquisition prices. This makes sense given that acquisitions are also accounted for in your financial statements.
As a part of due dilliegence (and to sell themselves to investors) they will need to disclose all outstanding debts, explain profit forecasts and previous years of performance, complete balance sheet of incoming and outgoing expenses, ownership stakes, all that should give you a good picture of what is going on.
I am interested to see what kind of stake Paul Stahura has and how much income their eHow operation makes.