Track the companies that matter to you. It's FREE! Click one of these fan favorites to get started: Apple; Google; Ford.



What's Ahead for GoDaddy After Its IPO

Watch stocks you care about

The single, easiest way to keep track of all the stocks that matter...

Your own personalized stock watchlist!

It's a 100% FREE Motley Fool service...

Click Here Now

The world's largest web hosting and domain registrar site, GoDaddy, is planning to go public this year. The private company, that has over 45 million domains, had contemplated an IPO in 2006, but detracted due to unfavorable market conditions. Now, it faces an entirely different context. Until now, 2014 has been a strong year for IPOs. Several tech companies are going public, including cloud storage company Box, and King, developer of Candy Crush Saga. So, GoDaddy will soon interview banks to underwrite its IPO.

In regard to the company's service, it is designed to help people without technical knowledge set up online businesses. Consequently, it is aimed toward small and mid-sized businesses. Customers can pay for an economic package, which is widely regarded as a complete service. But, they can also pay for additional features as needed. GoDaddy has more than 12 million customers around the world, and has several positive reviews from authority sites. That being said, one major concern is that customers have several alternatives that offer high-quality, economic services. In other words, the market is quite competitive. So, what is ahead for GoDaddy after its IPO?

Possible outcomes of the company's rebranding
In January 2013, Blake Irving, former executive at Microsoft and chief product officer at Yahoo, stepped into GoDaddy as the new CEO. Immediately, he started working on a new plan for the business, with a strong focus on rebranding. Through the communication of his vision, he was able to hire important managers from Google, Yahoo, and Microsoft.

The company is rebranding itself as a service that allows anyone to comfortably start their own online business. In that manner, it is focusing strongly on small-sized businesses. In order to do that, it is changing its advertisements and creating a much more user-friendly service. As a result, the company can increase its user base, which leads to greater revenue. Last year, it experienced considerable customer base growth in India, and an overall yearly revenue of approximately $1.4 billion.

The capital raised in the IPO can support the company and its current plans. Moreover, GoDaddy can continue with its strategic acquisitions. Last year, it bought Locu, a start-up that lists small businesses online, and Media Temple, a web-hosting service for software developers.

A strong competitor that went public in October is Endurance International Group (NASDAQ: EIGI  ) . The web hosting company raised $252 million in its IPO. It currently owns several popular hosts that offer a complete and economic service like HostGator, JustHost, FatCow, and iPage. The company has grown considerably over time due to the acquisition of these smaller hosts. Moreover, its stock is up by 19% of its IPO price of $12.

Endurance is a threat for GoDaddy ibecause it also targets small and mid-sized businesses with a strong focus on user growth. It is currently expanding its product portfolio, making it more accessible to people. Moreover, the company is aware of the growth potential in Brazil and India. The CEO, Hari Ravichandran, has estimated that the company's revenue will increase more than 50% in the former country and over 60% in the latter.

Another public company in the hosting market is Rackspace (NYSE: RAX  ) , which also operates in cloud computing services. This company is currently going through difficult times. Since its CEO's retirement, its stock has decreased drastically. On a positive note, the company retains its talent, invests in differentiation strategies, and provides quality services and support. Taking those factors into consideration, hiring the right CEO can improve the situation for the company. Then, with its Fanatical Support -- a service in which experts offer help to customers -- it can move ahead in the hosting market.

Final foolish takeaway
GoDaddy has several advantages for its IPO. The company has 12 million users worldwide and 45 million domains. Through appropriate rebranding and targeting of small-sized businesses, it plans to expand its customer base and increase its revenue. Moreover, it is managed by highly skilled executives. However, there are competitors in the market that also offer quality hosting services and target small to mid-sized businesses.

The positive side is that the growth of these companies shows the high potential of this market. For example, Endurance stock has increased 19% since its IPO in October. Even though Rackspace has a strong presence in the market, it still has to recover from its CEO retirement to pose a truly dangerous threat. So, GoDaddy has favorable market conditions for its IPO, and potential for considerable growth this year.

The next industry to crumble
Imagine owning (up over an insane 4,000% since 2001) when Internet sales rendered big-box retailers obsolete... Now an industry 99% of us use daily is set to implode... And 3 established companies are perfectly positioned to take advantage of this game-changing economic shift. Enter your email address below to find out how YOU can take advantage!

Read/Post Comments (1) | Recommend This Article (2)

Comments from our Foolish Readers

Help us keep this a respectfully Foolish area! This is a place for our readers to discuss, debate, and learn more about the Foolish investing topic you read about above. Help us keep it clean and safe. If you believe a comment is abusive or otherwise violates our Fool's Rules, please report it via the Report this Comment Report this Comment icon found on every comment.

Add your comment.

Sponsored Links

Leaked: Apple's Next Smart Device
(Warning, it may shock you)
The secret is out... experts are predicting 458 million of these types of devices will be sold per year. 1 hyper-growth company stands to rake in maximum profit - and it's NOT Apple. Show me Apple's new smart gizmo!

DocumentId: 2882066, ~/Articles/ArticleHandler.aspx, 9/2/2015 8:08:39 PM

Report This Comment

Use this area to report a comment that you believe is in violation of the community guidelines. Our team will review the entry and take any appropriate action.

Sending report...

Adrian Campos

Worked as an engineer and IT consultant for 25 years. Internet entrepreneur since 1996. Webmaster of,,, among other sites and apps. Fool since 2013. In love with tech, innovation, startups, marketing, researching emerging markets, and taking a Foolish approach to business model analysis.

Today's Market

updated Moments ago Sponsored by:
DOW 16,351.38 293.03 1.82%
S&P 500 1,948.86 35.01 1.83%
NASD 4,749.98 113.87 2.46%

Create My Watchlist

Go to My Watchlist

You don't seem to be following any stocks yet!

Better investing starts with a watchlist. Now you can create a personalized watchlist and get immediate access to the personalized information you need to make successful investing decisions.

Data delayed up to 5 minutes

Related Tickers

9/2/2015 3:59 PM
EIGI $14.97 Up +0.23 +1.56%
Endurance Internat… CAPS Rating: No stars
RAX $30.76 Up +1.33 +4.52%
Rackspace Hosting CAPS Rating: ***