About half of the small and micro businesses that GoDaddy recently polled predicted a weaker U.S. economy in the next six months. However, less than 10 percent of them expect a decline in their company’s revenue.
The confidence and resilience of those business owners—and their thirst for digital tools to make their organizations more visible and efficient—is what causes GoDaddy CFO Mark McCaffrey to exude confidence about what lies ahead.
Once known as just a domain name registry, GoDaddy, a publicly held company with nearly $5 billion in revenue, now offers website-building, marketing, e-commerce and payment solutions for its 20 million customers. Getting micro and small businesses to utilize more of GoDaddy’s consolidated technology stack is a key focus for the organization.
“We get 1.2 billion signals from our technology stack every day,” McCaffrey recently told the audience at a JP Morgan research conference, according to S&P Capital IQ. “That allows us to understand our customers, know what our customers like, know what they need [and] know when they’re having problems.”
McCaffrey shared the company’s customer-focused strategy as well as its financial objectives and the progress in its plans to leverage AI.
What are the tailwinds for GoDaddy’s business and the company’s competitive advantages?
GoDaddy benefits from several strong tailwinds. People pursue entrepreneurship for various reasons, which continues to drive demand for our digital tools and services. And with our suite of products and expert guidance, entrepreneurs trust us with their ideas.
At the same time, advances in technology and AI enable us to deliver better experiences—such as GoDaddy Airo®, our AI-powered experience that provides all the tools an entrepreneur needs to build their business online in a few minutes.
Those tie into GoDaddy’s competitive advantages, which include strong global brand awareness, the scale of serving more than 20 million customers and our ability to deliver a seamless user experience. Our customer care guides [support personnel] also set us apart, offering customers personalized guidance and support at every stage of an entrepreneur’s journey.
How has GoDaddy’s finance department evolved since the beginning of your tenure? What’s your focus at this point?
The finance department has undergone significant transformation since the beginning of my time at GoDaddy, growing into a team of 240 professionals spread globally. My role has become increasingly strategic and people-focused—I spend a large amount of time analyzing emerging trends, shaping long-term plans and supporting growth across the business.
While providing financial oversight is a core part, I am also focused on empowering my teams and driving a culture of collaboration and support—leading with purpose and connecting authentically and encouraging open communication, transparency and collaboration at all levels. My role demands both financial expertise and emotional intelligence. Connecting with folks is an incredibly rewarding part of what I do.
As GoDaddy continues to transform from a domain business, how do you see the company’s business model evolving to support the strategic shift?
By integrating our technology stack and adopting an evidence-based, experimentation culture, we accelerated the pace of innovation and our ability to evolve into a true one-stop shop for entrepreneurs. With the power of generative AI, backed by our significant data advantage, we can deliver more seamless experiences for every part of an entrepreneur’s journey.
Our ability to bring solutions that encourage [customer] conversion, “attach” and retention, optimizing for lifetime value, is the foundation of our strong and durable model. It supports profitable growth, strong free cash flow generation and disciplined capital allocation, all of which keep us moving toward our North Star: maximizing free cash flow over the long term.
Please explain the customer “attach” model and how GoDaddy drives that.
That strategy focuses on attracting high-intent customers who want to build their businesses with GoDaddy. By offering a seamless, integrated experience with a single dashboard, login and care organization to call for support, we create a strong value proposition that drives better conversion, higher retention and greater lifetime value.
This focus on quality over quantity is working: Customer retention has improved [as] customers spend more [dollars] with us and adopt more products. We have found that typically, once a customer reaches three or more products, retention becomes exceptionally strong, and their lifetime value rises significantly. Customers who succeed with us tend to stay with us, which strengthens our flywheel of profitable growth, strong free cash flow generation and a more resilient, durable model.
The company has a track record of expanding NEBITDA margins by 100 to 200 basis points annually for the past three years. How has it done that?
We’ve strengthened our NEBITDA margins by focusing on higher-margin revenue streams and ongoing operational discipline. We continued driving growth in our high-margin [applications and commerce] segment and realized savings by tapping into our global talent pool, migrating to a cloud-based infrastructure and reducing leased office space. Our margin improvement shows the effectiveness of the current operational strategy.
Is GoDaddy leveraging AI technologies to drive operational efficiencies internally?
We continuously explore how AI and machine learning can enhance our internal operations, particularly our long-range rolling forecast process. We view AI as a supportive tool—innovation and experimentation are core to our culture, and that includes thoughtfully integrating both traditional and new technologies.
For example, we are equipping our care guides with the AI-powered GoDaddy Guide Assist Interface—a real-time coach, assistant and conversational partner. It helps our guides serve customers efficiently by finding answers, resources and product or bundle suggestions in seconds. We also launched customer-facing chatbots in international markets, leading to improved containment rates and savings of more than 16 million incremental contact minutes.
By aligning our strategic objectives with a risk-based perspective, we aim to continue investing in innovation while maintaining proper governance in our finance operations. In the future, AI may further transform our finance tech stack by driving greater efficiency and offering deeper insights.
