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Thread: HostGator / EIG Transaction
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06-27-2012, 08:20 PM #26Web Hosting Master
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That EIG is raising $225M to do this deal has already been published in some online publications that cater to the hosting industry. So I expect it's true, but deals of this nature can always go sour at the last minute.
But it is more of the private equity routine, which is to use someone else's money to buy companies.0
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06-27-2012, 08:29 PM #27Disabled
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I think yes. For such big deal, the EIG would be serious about the business and get more clients with HG current popularity. If they fail to do that, it will be a huge loss.
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06-27-2012, 08:30 PM #28Web Hosting Master
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It's still a private equity company, and they don't have stellar records for buying companies and enhancing their reputations.
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06-27-2012, 08:30 PM #29Web Hosting Master
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06-27-2012, 08:40 PM #30Junior Guru Wannabe
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I think they could make hostgator more profitable using already made systems which decrease development costs. Rather than hiring a bunch of developers or programmers to work on billing systems and such, they could simply implement an EIG branded one that all of the other companies use. Already made, no need to pay a bunch of cash for something separate.0
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06-27-2012, 08:42 PM #31Web Hosting Master
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According to Oxley's email on the subject, HG had problems implementing an efficient and well-integrated billing system, and in setting themselves up as a domain registrar. So I suppose EIG could make both happen. They already have the billing systems in place.
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06-27-2012, 09:12 PM #32Web Hosting Master
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Thats what I was saying in case I didn't say it properly.
Hostgator now, has programmers working on the billing system and other systems within the company. If EIG does purchase hostgator, I would have to say there are going to be some large odds that hostgators programmers may lose their jobs due to the systems in place EIG has. Such as domain registration, working billing and anything else. Making hostgator more profitable.
Vdeck would probably vastly improve their profits too but I doubt customers would be happy with the transition after using cPanel for years.
I'm very curious about what changes are going to happen. A lot of the companies EIG owns really seem to be focused on shared hosting. If you need to upgrade past shared hosting, you are unable to stay with the company and are forced to move. While hostgator on the other-hand has just about all of the offerings needed to constantly grow your website with the company.0
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06-27-2012, 09:16 PM #33Web Hosting Master
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I can't comment on the rumors regarding HostGator, but I do want to clarify that VOIPo is NOT owned by HostGator.
To clarify...
I'm the founder of VOIPo and a former HG executive. Brent (founder of HostGator) made a personal investment in VOIPo in 2006 and we jointly own it. It is not owned by HostGator and his portion is a personal investment on his part only.
While we have a great relationship with HostGator and have done cross marketing to leverage the HostGator brand especially when we first launched, there is no financial connection between the two companies in any way outside of HostGator being a large VOIPo customer (we provide their service and the service for their business plan toll-free numbers).
Many people think there's an ownership connection due to the cross promotion, but there's not. If there is any type of transaction involving HostGator, it would have zero impact on VOIPo.Last edited by Timothy; 06-27-2012 at 09:20 PM.
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06-27-2012, 09:24 PM #34Web Hosting Master
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No. Next question.
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06-27-2012, 10:03 PM #35Web Hosting Master
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Duplicate thread. This is being discussed in the web hosting forums already.
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06-28-2012, 12:39 AM #36Web Hosting Master
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Yada, Yada, Yap, Yap, nothing new posted here which wasn't posted in the initial EIG/Hostgator thread.
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06-28-2012, 12:43 AM #37Junior Guru Wannabe
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Here's Brent's email blast to HG customers as copied from http://hostjury.com/blog/view/453/se...r-to-endurance.
Hello Fellow Gators,
There have been rumors flying around the web and the office about HostGator being sold for many years now. I'd like to address these rumors and put many of your fears to rest. I still own 100% of HostGator and haven't collected a single penny towards any buyouts at this time.
The latest rumor is the first that actually has some truth behind it. I have indeed agreed to sell HostGator to Endurance International Group, which is why you're hearing stories about Endurance International Group raising financing to purchase us. We are currently under contract and if everything goes according to plan, Endurance International Group will be purchasing HostGator in the next 3-4 weeks.
This is the first time in HostGator's history that we have ever reached an agreement on the terms needed to complete a deal.
In the last few months, I've spent countless hours getting to know Endurance International Group CEO Hari Ravichandran, and I can honestly say that he is one of the most trustworthy and knowledgeable people that I've ever met. In other deals we've looked at, the potential buyers have only seen HostGator as a slot machine and that's not true of Hari. He clearly understands that HostGator is the 800 pound gorilla that it is today thanks to all of you who provide the legendary support that HostGator is known for.
It's only natural for all of you to be apprehensive towards change and the fear of possibly losing your job. I can write whatever I want in order to cover for Endurance International Group, but I would rather let the facts speak for themselves:
When I first heard about Endurance International Group purchasing Bluehost in November 2010, I was extremely ecstatic. The first thoughts that came to mind were that Endurance International Group was going to destroy the company, resulting in one of our biggest competitors going the way of the dodo. However, rather than plunder and pillage, they've hired and flourished. Bluehost was at 280 employees when the sale closed and they have 450 today. Their management team has stayed the same and the culture has stayed the same. Now, the Bluehost culture, employees, and philosophy have taken hold to become the new status quo of EIG.
I'm confident the same will happen once again with the best of HostGator culture, ideas, people, and leadership coming together at EIG to create a more powerful hosting company than the world has ever seen. In fact, I've heard that Endurance International Group with HostGator will be even bigger than GoDaddy.
Once this deal is complete, I will continue to own all of the HostGator occupied buildings through Oxley Leasing. Endurance International Group and I will soon have a leasing deal in place that will not only include all of the current occupied space leased, but will also expand Austin by 30,000 square feet as well as Houston by another 10,000-20,000 square feet. Hari has also told me that one of his first acts of business will be to do a major renovation of the Houston office. If Endurance International Group planned on downsizing, they wouldn't be signing such huge expansions in both Houston and Austin.
HostGator will be EIG's largest acquisition to date and with that it's going to create countless opportunities for each and every person. Not only at HostGator, but also at other Endurance International Group brands. I can't stress enough how instrumental it will be for Endurance International Group to replicate HostGator's strengths across all of their brands, and to do that, they will need HostGator leaders and know how.
There are many of you who are going to call me crazy for deciding to sell during a time in which HostGator has experienced unprecedented growth and success. I'll do my best below to share a few of the many reasons behind my decision:
- I want to travel the world before my wife and I have kids.
- I've been doing HostGator since I was 18, and I'm looking for a new challenge.
- I'm extremely worried about the financial path our country is headed down.
- Taxes will be going up significantly in 2013, making it more difficult for business owners.
- I've failed more times than I can count to launch software that would allow us to compete as a registrar.
- We have tried and failed to develop a billing system that has automated and can integrate with our key systems such as chat, phone, affiliates, and tickets. I think we are finally on the right track, but unfortunately I no longer have the patience to wait for it to all come together. Thankfully Endurance International Group has tackled a lot of these challenges already.
- I have practically 100% of my chips in HostGator and if something should ever happen to the company, I'd more than likely be bankrupt ina matter of a few months.
I could stick with HostGator for a few more years and turn it into a multi-billion dollar business, but I think now is the right time for me to move on and to let the company continue to grow and succeed under Endurance International Group.
If any of you have any questions, feel free to email me and I'll do my best to get them answered. The key thing to remember is that this deal isn't complete yet, and if and when it completes, Adam Farrar and the rest of management won't be going anywhere.
Sincerely,
Brent Oxley0
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06-28-2012, 01:19 AM #38How Can I Help You Today?
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Nice long email, I'd recommend brent to write a book on his HG success so we can all share his wisdom throughout the years.
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06-28-2012, 01:49 AM #39Newbie
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06-28-2012, 09:36 AM #40Web Hosting Master
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06-28-2012, 09:52 AM #41Web Hosting Evangelist
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06-28-2012, 03:28 PM #42Disabled
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06-28-2012, 03:31 PM #43Web Hosting Master
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http://top5hosts.ipage.com/ is one
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06-28-2012, 04:01 PM #44Junior Guru Wannabe
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I don't think EIG has opened any fake sites. I agree that the Ipage topsite you linked to is silly, but its not fake. What has happened is that many webmasters made top-sites and review sites full of hosts high paying affiliate programs, predominately EIG hosts.
I'm not sure its fair to hold EIG responsible for that.0
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06-28-2012, 04:17 PM #45Junior Guru Wannabe
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HostGator Officially Sold
I recently sent an email to Brent Oxley, CEO of HostGator.
I thought everyone would appreciate his reponse.
Hi Joshua,
The deal is already signed, there's no way for me to change my mind even if I wanted to. They are going to be keeping my old staff, management, etc so I see no reason why there's going to be any type of negative impact. If they planned on firing and outsourcing there's no doubt the quality of service would be going down. EIG has learned a lot over the years on what works and doesn't with deals.
Sincerely,
Brent Oxley
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06-28-2012, 04:29 PM #46Junior Guru Wannabe
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Thanks for sharing. I wonder when they will post something on HostGator's site.
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06-28-2012, 04:36 PM #47Aspiring Evangelist
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Chat ID: 6315723. Question: Has HostGator been sold to EIG?
(6:31:08am)System:Customer has entered chat and is waiting for an agent.
(6:32:59am)Nikolina M.:Welcome to HostGator Live Chat. My name is Nikolina. I would be happy to assist you today.
(6:33:10am)Matt:Hello
(6:33:31am)Nikolina M.:Unfortunately I am not able to comment on that question.
I should mention, I use HostGator. I guess I better look for an alternative, just in case.Last edited by FourtyThree; 06-28-2012 at 04:41 PM.
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06-28-2012, 04:39 PM #48Web Hosting Master
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Such a sad day in the Web Hosting Industry
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06-28-2012, 04:41 PM #49Marketing Maestro
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06-28-2012, 04:45 PM #50Web Hosting Master
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