wsj.com startupjournal
wall street journal center for entrepreneurs
businesses for sale
franchises for sale
business opportunities
business brokers
toolkit
create a business plan
bookstore
email center
discussions
columnists
survival strategies
bill collecting
tax and legal info
hiring and retention
family business issues
vendor relationships
learning from failure
selling your business
site help
about us
advertising info

wsj.com network
The Wall Street Journal
CareerJournal
CollegeJournal
OpinionJournal
RealEstateJournal
WSJbooks
CareerJournalAsia
CareerJournalEurope
MarketWatch
subscribe to wsj.com
subscribe to wsj
subscribe to Barron's
Register for MarketWatch
search
search startupjournal
search businesses for sale
go advanced search
IN THIS STORY
DID YOU KNOW...
- Parsons' Rules for Success


~ ~ ~
marketplace

Before you invest, get a Franchise High Performers Snapshot Report and learn the facts.

The Premier International Source for Information about Franchising & Business Opportunities.

Promote your Business to Investors, Media and Customers

Experience Investing Clarity
Subscribe today and get $10 off SmartMoney Select

GoDaddy's
Remarkable Daddy

From Worthwhile magazine

By now, most everyone knows what GoDaddy.com is.

Even those who didn't actually see the controversial Super Bowl ad -- a buxom marketing woman testifying before regulators as her top comes undone -- heard about it at work the next day. It was The Buzz, exactly what GoDaddy, the world leader in domain name registrations, was craving.

For Bob Parsons, the man behind GoDaddy.com -- GoDaddy's daddy, if you will -- it is the latest step in a career of remarkable risk-taking and hyperbole. "I manage on hunch," he says of the ad. "I had a lot of cash and it seemed like the right thing to do. How could it not help us? Now it's the most famous commercial in the history of television."

Like many things in Parsons' life, the commercial was a jolt -- this time to some conservative Christians, who had thought Parsons was one of them. After all, Parsons' first company, Parsons Technology, created the wildly popular Bible software QuickVerse. After the Super Bowl, their vitriol was tinged with betrayal. "Shame on him. He may have received high name recognition, but there are untold numbers of Americans who will not forget what he did," says Bill Johnson, head of the American Decency Association. "It was wicked, evil."

Parsons doesn't take such blasts kindly. "That's absolute nonsense," retorts the former Marine, calling himself a moderate Christian. "There's nothing wicked or evil about it. All we did was a little parody of censorship....There's nothing in the ad inconsistent with being a Christian."

A Life-Threatening Beginning

Though some folks on the religious right are trying to demonize Parsons for the Super Bowl ads, he could pass for a poster boy for The Clean Plate Club: principle over profit. He's the good guy who refuses to cut corners, works hard, is honest -- and gets more than his share of lucky breaks in shooting bottle rockets out of a jack handle during a slow period, when two gunmen held up the store. The gunmen stood him up to be executed, twice, but ultimately chickened out. Although he wasn't the only employee on duty at the time, he was the only one to testify against the gunmen -- because, again, it was the right thing to do.)

What's more, Johnson and his peers would be horrified to know Parsons actually thinks the Lord is on his side. Purpose, passion -- and providence. And, looking at the story of his life, it's hard to argue with the preponderance of evidence to that effect. "I've definitely been blessed," says Parsons, the 55-year-old earring-clad father of three grown children.

Parsons, who now calls Scottsdale, Ariz., home, grew up "as dirt poor as a church rat" in inner-city Baltimore. His father was a furniture salesman for Montgomery Ward who had a hard time providing for Parsons and his two siblings but had no shortage of simple wisdom. (It's impossible to go through a conversation with Parsons without him quoting his father: "The first time you get bit, it's the dog's fault.")

After barely graduating high school, he joined the Marines and found himself in the dangerous rice paddies of Vietnam's Quang Nam province. "When I joined my rifle squad, it had just gone through an ambush and four of the guys had been killed. They were down to four or five people. I had an anxiety attack. It occurred to me, 'I'm going to die here.' My goal then became each and every day just to make it to mail call."

Put It in Writing

The experience shaped the businessman he is today.

"I learned back then not just to expect the worst, but to quantify the worst," Parsons says. "When I start feeling afraid about what's going on with GoDaddy, I take out a piece of paper and say, 'What's the most terrible thing that could happen?' When you see it in writing, you realize it's nothing to get paralyzed over."

The Marine in him also demands discipline of himself and his company. He wakes at 7 a.m. sharp each day, reads email and works on his blog. Then he does 100 pushups, legs elevated, and 45 minutes on his elliptical trainer. After return. (At 16, he was working at a gas station in Baltimore on the Fourth of July, more work from his home office, he gets into GoDaddy around 1 p.m. and works until 6. After dinner with his wife, he works in his home office again until about 1 a.m.

Not surprisingly, GoDaddy is a "tight ship." Company execs receive not only a daily profit-and-loss statement, but occasional hourly measurements of every business unit. The reports show how each unit is doing compared to the same hour in the prior four weeks.

After Vietnam, Parsons graduated the University of Baltimore in 1975, and bounced around a few business management jobs, then created an accounting program for his personal use. Then he figured: "If it's good enough for me -- and my standards are pretty high -- then why not sell it?" The result was Parsons Technology.

In 1984, with $15,000 in savings, he holed up in his basement and wrote the code for his first product, money management software called Money Count. He priced it at $99 -- and then watched in agony as it gathered cobwebs on store shelves. The next year, using his tax refund and other money, he took $25,000 and lost it all trying to produce Money Counts for $69. The third year, he dropped the price to $12 and began direct marketing the product.

Success Begins, Not Without Drama

Parsons overworked himself so much he had to be hospitalized twice for exhaustion. But sales began to soar. "My dad always told me, 'When you love something, it tells you all its secrets.' It took me three years to figure out how to sell Money Counts. I just stuck with it and eventually I won."

Win he did: Ten years after starting Parsons Technology, the company was generating just shy of $100 million annual sales. In 1996, he sold Parsons Technology to Intuit for $64 million.

When Intuit bought Parsons Technology, it required Parsons to stay out of the industry for a year. He chafed at the idleness. Hence, 12 months later, GoDaddy was born. "My only goal was I wanted to be at risk again," Parsons says. "I needed a purpose."

What exactly was that purpose, though? All early GoDaddy endeavors tanked. In 1999, during the height of the dot-com bubble, Parsons figured he needed a way to stand out from all the hubbub. "Looking around, I realized the domain market was overpriced, the systems were schlocky and the service was poor. There's an opportunity!"

It took a year to write the code -- a year of amazing cash outlays. "I was losing my shirt investing in dot-coms and we were burning $200,000-$400,000 a month of my money developing the product. I got to the point where I said, 'OK, I'll keep doing this until I have $20 million left.' Then we'd reach that point and I'd say, 'OK, $16 million' then $15 million, then $12 million, then $10 million. When I got to $8 million, I made the decision to close the company."

But a vacation at that point changed his mind. "I took a trip to Hawaii to clear my head and figure out how I was going to tell my employees they were all unemployed. One day, I saw a valet parking cars and he was real happy. I said, 'You know what? If I lose all my money, I can just park cars and be happy.' I came back and said, 'If the company goes broke, I go broke with it.'"

Success Redux

It didn't. Nine months later, GoDaddy started a climb that hasn't stopped.

"I really didn't do anything different. It was just my time to succeed. It was providence," Parsons says. "I had done everything right. Everything was in place. I just didn't realize I was about to succeed. When you're failing in business, the trick is to be able to stand there and take it in the teeth and be humble long enough until things do turn around. My uncle used to say, 'Robert, you show me a successful businessperson and I'll show you someone who's been on his ass a couple times.'"

GoDaddy is now No. 8 on Inc.'s list of fastest growing companies, with an unworldly growth rate of 1,881.8 percent.

Things may even accelerate from here. The Super Bowl ads have become a watershed for GoDaddy. After the NFL pulled the second of the two ads, websites showing the ads collapsed from the site visitors piling on. On GoDaddy's site alone, the streaming videos of the ads were viewed 2.6 million times. Overall visits to GoDaddy's website jumped by 367 percent after the Super Bowl. More importantly, sales increased 70 percent in the weeks after the game.

Providence? Passion? Principle? Some of each, probably.

For instance, Parsons won't sell any product developed outside the company. Consequently, customer fixes are simple and GoDaddy can price products at sensible levels. "The whole idea is to make a little money from a lot of people. This differs from many companies, which have just the opposite philosophy."

The key to continued growth will be infusing that do-the-right-thing passion in his workforce, Parsons says. "People tend to imitate leadership. If they see me taking the high road, they will, too. For example, in all our marketing, there are never any tricks. The deal's the deal with us. Our employees know we're the best deal across the board in the industry -- they know we're helping people -- so they believe in GoDaddy."

And, if the wheels fall off the dragster -- well, it's been a hell of a ride. Real men don't pout. After all, it's only money.

"People tell me, 'You're the biggest risk taker I've ever known. If I made that much money from the sale of my first company, I would never risk it all again.' But GoDaddy isn't an exit strategy for me. It's a lifestyle. It's me."

Email your comments to sjeditor@dowjones.com.

--December 07, 2005

Home     E-mail to a Friend     Print-Friendly Format
Respond to This Article     Top of Page

Subscribe to The Wall Street Journal Online or take a tour
Sign Up Today for Free MarketWatch Membership



Copyright © Dow Jones & Company, Inc. All Rights Reserved
By using this site, you agree to our Terms of Use and Privacy Policy.

RSS RSS feed


spacer spacer