Bob Parsons is all about enjoying the ride. He doesn’t sweat the small stuff. He trusts his gut and his vision. All of that has made him a multi-billionaire with a string of successful businesses he’s founded, built, and sold over the past four decades.
Parsons’ success is an unlikely one: He grew up in poverty in Baltimore, and failed the fifth grade. After school, he enlisted in the U.S. Marine Corp and served on the front lines of Vietnam. But after the war, he studied accounting and coding at night and, in 1984, founded Parsons Technology, which sold home accounting programs.
Three years later, he was able to quit his day job to focus on Parsons Technology, growing it to a 1,000 employee company. In September 1994 he sold the company to Intuit for $64 million.
From there he went on to found GoDaddy in 1997 and to cement his status as one of the most successful serial entrepreneurs of the past 40 years. GoDaddy officially became the world’s largest ICANN-accredited registrar on the internet in 2005. Eventually, after selling a majority stake to private equity firms and overseeing a successful IPO, Parsons retired from GoDaddy’s board and sold off his remaining stake in the company in 2018.
But retirement hasn’t slowed down the 71-year-old one bit. He remains the CEO of YAM Worldwide, a holding company that he started in 2012 to house his other ventures. The companies it owns and operates reflect Parsons’ twin passions for golf and motorcycles, as well as a penchant for snapping up real estate. They include PXG (which stands for Parsons Xtreme Golf), Scottsdale National Golf Club, Harley-Davidson of Scottsdale, GO AZ Motorcycles, YAM Properties, and Yam Capital.
Parsons, whose net worth now sits around $3.4 billion, and his wife are also committed philanthropists. Together, they founded The Bob & Renee Parsons Foundation in 2012 with a mission to reach marginalized populations and causes that are underserved by mainstream philanthropies. It primarily focuses on the areas of LGBTQ youth, homelessness, education, medical care, and the needs of wounded veterans and military families.
The Business of Business sat down with Parsons to discuss his business philosophy, the story behind those racy GoDaddy ads and more.
This interview has been condensed and edited for clarity.
Business of Business: What was your inspiration for founding GoDaddy?
Bob Parsons: After I sold Parsons Technology, I didn’t keep any stock and stayed with the company for as long as I was contractually obligated to – which was about a year. Then I spent a year or two doing nothing. I knew the last thing I wanted to do was retire.
I was 47 years old when I founded GoDaddy in 1997. I had $36 million in the bank after my ex-wife got more than half my money in our divorce settlement, and I was ready to be busy again.
The first version of the company that would become GoDaddy was a search fund – a site for people to look for opportunities on the internet. It was promising at first, but I soon discovered that search funds rarely work, so I turned to selling hardware, building intranets and extranets, and developing education software. What I found was that building websites gained the most traction, so I focused the company on that.
I wanted the company to be one that I could scale enough that it would make money while I was sleeping. I developed a program that helped people build their own website and called it Website Complete. That eventually morphed into GoDaddy. At the time, advertisers wouldn’t even talk to me and startups were paying $200 to $300 per customer acquisition – I was convinced that should cost $2, not $200.
When did GoDaddy start to become the company we know today?
In 1999. I realized every company needed a website and every website needed a domain name. The companies that were selling domain names at that time were run by engineers, who are not good business people. Their websites were hard to build and navigate so I applied to be a domain registrar. It took a year to code and $1 million to build. We sold our first domain name in November 2000.
At the time, I was keeping track of the company based on how much cash I had left. I started with $36 million and thought I’d keep building the company until I got down to $32 million left. I ended up changing that to $25 million then $18 million then $16 million until in early 2001 I was down to $6 million and I still couldn’t get anyone to notice us. I decided to close the company down while I still had some of the Intuit money left.
What happened next?
I flew to Hawaii and checked into the Four Seasons without telling anyone what I was up to. I planned to figure out severance for my employees, how to sell the equipment I’d amassed, and also figure out what I wanted to do next. Retirement was still not an option that appealed to me.
“So I decided I’d keep GoDaddy going and run it until I ran out of money. I’d go down with the ship. ”
While I was in Hawaii, I had an epiphany. The valet at the hotel tossed my keys to me while saying “How are you doing Mr. Parsons?” I noted his age and that he was perfectly happy parking cars at a hotel, and there I was with $6 million in the bank and I was miserable. So I decided I’d keep GoDaddy going and run it until I ran out of money. I’d go down with the ship.
This was around the time of the dot-com/NASDAQ crash, wasn’t it?
It was. The dot-com crash led to the success of GoDaddy. Companies I’d been doing business with were just suddenly GONE. So people and companies started approaching me begging to let them advertise with GoDaddy because I was one of the few pre-crash companies still standing.
GoDaddy broke even for the first time in November 2001 and has been profitable every month since that time.
This brings to mind a Chinese proverb that says: The temptation to quit will be greatest just before you succeed.
When did you launch your iconic advertising campaign?
In 2004, GoDaddy had a 16% market share. Other companies’ rates were higher and their services, quite frankly, sucked. I hired a market research firm to tell me what was obvious, but I was way too close to the problem to see. They said no one knew GoDaddy existed because we only advertised on the internet.
I decided to do a TV ad and why not go big and make an ad for the 2005 Super Bowl. At this point I had $10 million. The Super Bowl ad cost a couple of million. I began to think about how I could get what GoDaddy did across to people who saw the ad. How could I get the public interested in the GoDaddy.com name?
I had a breakthrough when I saw a commercial for Mike’s Hard Lemonade in which a man’s tongue grew so that he could get to the liquid at the bottom of the bottle while attractive women looked on hungrily. It occurred to me that we had to get the attention of the Super Bowl audience – who is likely drinking and socializing.
I knew I needed to do an outrageous and inappropriate ad so that people would talk about it. The prior year’s Super Bowl was the Janet Jackson/Justin Timberlake wardrobe malfunction at halftime so I decided to do a spoof on that with a beautiful woman in a GoDaddy tank top testifying before censors about how domain names can be bought at GoDaddy. As she talks, the strap on her tank top breaks.
Broadcast censors approved the ad in storyboard form, but rejected it when the video of the ad was submitted. It took until the week before the Super Bowl to get approval to run the ad – which just suggested nudity and was shot from the back, with the woman’s boobs blurred out. The ad ran in the first quarter of the game and GoDaddy immediately saw a huge increase in traffic.
Fox Sports offered me a second ad that would air at the two minute warning. When the two minute warning approached, the team was on the one yard line ready to score and change the lead – all eyes were glued to televisions – and Fox didn’t run the ad. They ran a promo for the Simpsons instead. I called the head of Fox Sports who explained they had to pull the ad but told me to call tomorrow and let him know what I wanted to make up for that.
“I ended up writing a blog article about it — no one had ever had a Super Bowl ad canceled in the middle of game. The blog post got picked up all over that week. ”
I turned to my right hand guy and said, “Can we be this lucky?!” I ended up writing a blog article about it — no one had ever had a Super Bowl ad canceled in the middle of game. The blog post got picked up all over that week. Every TV station, news channel, newspaper, and talk show wanted to talk to me. I was doing interviews from an hour before sun up to an hour after sundown for a week.
Market share of GoDaddy went from 16% to 25% in a week, and it held. The media named the ad’s actress, Candice Michelle, the GoDaddy girl. From that point forward, edgy, sexy, suggestive ads (like Paris Hilton’s Carl’s Jr ad) were called GoDaddy-esque. We had a 50% increase in business and the market share continued to soar until we hit 70%.
When did you decide to move on from GoDaddy?
In 2011, did a private equity deal that valued GoDaddy at $2.25 billion with no debt. I kept 29% of the company and stayed CEO for a bit before serving as Chairman of the Board until GoDaddy went public on April 1, 2015. I didn’t want to be the chairman of a public company.
And this leads us to your current company, PXG. Tell us about that.
I started PXG, Parsons Xtreme Golf in 2013. I wanted to build the best golf clubs on the market.
I’ve been an avid golfer for years and noticed that cost and time constraints kept the golf industry from developing better golf clubs. I had no cost or time constraints and released my Gen 1 clubs in 2015. They are expensive and they captured the attention of avid golfers. The industry overall was surprised at the number of people who bought them.
PXG doesn’t sell our clubs in retail stores. We sell direct. PXG clubs are a high end luxury item – but an affordable luxury item. People who buy PXG clubs feel they are a part of something. In 2021, PXG’s sales were in the low nine-figures.
Your story brings to mind the old adage “do what you love and the money will follow.”
My dad always said that when you love something it tells you all of its secrets. I felt alive and fired up while building GoDaddy, and it was also so much fun.
I have 14 different businesses right now and when asked why I have had so much success in my life, I have to stress that I don’t run my businesses in the typical way. I believe goals are negative. Rather than trying to meet or achieve a goal every year or quarter I try to become better in every area — design better, be more clever, have an open mind.