Why the GoDaddy Acquisition is Newsworthy

Last week, I shared the news about NameFind (GoDaddy) acquiring a domain name portfolio from Yummy Names (Tucows). Although I could only see a handful of domain names transfer, I concluded that it must have been a portfolio acquisition because I have not seen GoDaddy acquire small groups of domain names before. This indicated the company bought a portfolio and GoDaddy’s Paul Nicks confirmed the news. As is typical, Paul declined to tell me how many names the company bought nor did he share the dollar value of the acquisition. Despite this, I still believe this acquisition is newsworthy.

In my opinion, GoDaddy has more domain name sales data than anyone else in the business. GoDaddy manages its own portfolio of hundreds of thousands of domain names, and it also has oversight on sales and offers received by its clients via Afternic and elsewhere within GoDaddy. I would speculate that GoDaddy can see and track offers and sales on several million domain names. This is in addition to GoDaddy Auctions, which is more focused on the wholesale side of the market. A few domain brokers may have as good (or better) of a read on the highest end of the domain name aftermarket, but GoDaddy has more intel on the overall health of the aftermarket than any other company.

This portfolio acquisition is newsworthy to me because it shows me that GoDaddy has confidence in the state of the domain name aftermarket. The company could just as easily sit on their huge portfolio and focus on selling what they have. Instead, the company is still out there growing their portfolio.

For the past year or so, I think GoDaddy has been relatively quiet on the acquisition side of things. I don’t recall hearing about nor seeing a portfolio acquisition in about a year. I wouldn’t say this is troubling, but it is a bit concerning that the company wasn’t buying portfolios from investors eager to cash in and retire or move on to other investment opportunities.

With the prospect of a downturn in the economy looming, it gives me confidence to see GoDaddy expanding its portfolio rather than continuing to sit idly. I may not know how many domain names the company bought, and I may not know how much the company spent to buy these domain names, but given what I do know, it is noteworthy that GoDaddy is still buying domain names when the opportunity comes up.