GoDaddy Adds SMB Social and Presence Power with Main Street Hub

GoDaddy is buying Main Street Hub, the Austin-based social media and presence manager, for $125 Million, and $50 million in possible earn outs. The acquisition appears to be a good fit for GoDaddy’s SMB customer base, feature-wise. GoDaddy has been aggressively building out its features platform, and now gets less than half its revenue from its core Domains business.

Main Street Hub also provides GoDaddy with a new, higher priced Do It For Me service tier, averaging around $250 a year. The average GoDaddy customer – more oriented towards Do It Yourself – spends around $129 a year.

Typical services provided by Main Street Hub focus on content strategy. They include managing all aspects of an SMB’s Yelp, Twitter, Facebook and Google accounts (social posts, review management, solicitation); as well as provide mobile-optimized landing pages, and email products. The addition of an Austin office will also be seen as a plus to GoDaddy, which is based in Scottsdale, AZ.

The big question is whether GoDaddy can do much more to grow Main Street Hub’s customer base, leveraging its 17 million worldwide customers. Main Street Hub — which is mostly a cold-call sales operation — has reported the same, static customer base of 10,000 customers for several years. We think GoDaddy is well positioned to do a lot here.

Main Street Hub’s apparently slow growth is probably due to its limited sales channels and the intense competition in the social media SMB space, which is dominated by independent agencies. Increasingly, other platform players have also been a factor. These include players such as Endurance (including Constant Contact, Host Gator), Web.com (including Network Solutions, Yodle), 1&1, MailChimp, Wix and others.

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