GoDaddy Inc.
Q4 2020 Earnings Call Transcript

Published: 11 Feb 2021

[Mark Grant:]

Good afternoon and thank you for joining us for GoDaddy’s Fourth Quarter and Full Year 2020 Earnings Call. I’m Mark Grant, Vice President of Investor Relations. With me on the call today are Aman Bhutani, Chief Executive Officer and Ray Winborne, Chief Financial Officer. Following prepared remarks by Aman and Ray, we’ll open up the call for your questions. On today’s call, we’ll be referencing both GAAP and non-GAAP financial results and operating metrics such as total bookings, unlevered free cash flow, normalized EBITDA, net debt and gross merchandize volume. A discussion of why we use non-GAAP financial measures and reconciliations of our non-GAAP financial measures to their GAAP equivalents may be found in the presentation posted to investors.godaddy.net or on our Form 8-K filed with the SEC with today’s earnings release.

[Aman Bhutani:]

Thanks Mark and thank you all for joining us. Go Daddy exists to empower everyday entrepreneurs. Our mission is to make opportunity inclusive for all and the shift to digital represents the greatest opportunity for our customers to share their gifts with the world. With a differentiated offering, including guidance and tools within intuitive seamless experience, specifically designed and built for our customers, it is clear like customers continue to adopt our products and ask us for more. Everyday entrepreneurs are creative and resourceful and they want to be able to focus their time on their business from domain names email and content creation to commerce and soon they include payments and point-of-sale. Customer focus for us is about building a seamlessly intuitive experience that saves them time and unlocks capabilities through ease of use. In 2020, our digital presence was key for our customers and the increased demand led to accelerating bookings growth for the last three quarters for us. For 2020, GoDaddy neared $3.8 billion in booking and topped $3.3 billion in revenue. We leaned into the surge in demand with marketing spend and while we kept it efficient, the result was our best year of net customer ads except 2017, which included the HG acquisition. We welcomed nearly 1.4 million net new customers in 2020 by providing valuable products and offering the best care. We've also been able to maintain stable renewal rates and our churn metrics, well those have always been low and they still found room to improve in 2020. Early last year we spoke about our natural evolution into commerce. Everyday entrepreneurs are underserved and demanded from us and our investments have been focused on the simplest and most relevant commerce experience. No doubt commerce continue to be a giant opportunity for us.

[Ray Winborne:]

Thanks Aman. I'll touch on the fourth quarter financial results and our outlook for 2021. Despite the operational challenges caused by the pandemic, we delivered a strong performance in 2020. We added 1.4 million net new customers, nearly double the number added in 2019. This was complemented by a decrease in our already low customer churn rates and resiliency in subscription renewal rates as our products and services became even more valuable to our customers. Full year revenue grew 11% year-over-year while our free cash flow was up 12%, even as we invested more marketing to capture higher demand in the market. We also took advantage of the opportunities created by the uncertainty deploying $1.8 billion capital adding capabilities for customers and creating value for shareholders. Turning to the fourth quarter results, we saw continued acceleration in topline. Bookings grew $943 million rising 13% year-over-year reported in constant currency basis as FX had little impact on the quarter. Growth was broad-based with continued strength across product categories. Revenue came in at $874 million outperforming expectations and growing 12% year-over-year. Business applications was again our fastest growing product line, increasing 20% year-over-year on continued strength in branded email and productivity solutions. Domains accelerated to 14% growth as new registrations, renewals and aftermarket sales remained strong along with a modest contribution from Go Daddy registry and finally, hosting new presence grew over 5% in the fourth quarter. We continue to see terrific growth in our website creation platform products. Through the strength was tempered somewhat of the headwinds from the Go Daddy social service due to elimination of the outbound sales motion in June. The key metrics underlying our growth remain consistently strong, ARPU rose to $166 up 5% year-over-year while the customer base grew 7%. Unlevered free cash flow for the quarter was $181 million and $825 million for the full-year. This reflected good operating leverage in the P&L as well as reduced capital expenditures for corporate real estate and infrastructure as we transition more workloads to the cloud. Gross margin remained in the mid-60s in the quarter consistent with our expectations. We continue to ramp investment in marketing to capture increasing demand, resulting in a $40 million year-over-year increase in marketing expense.

[A - Christie Masoner:]

Thanks Ray. Our first question comes from the line of Ron Josey from JMP Securities. Ron, please go ahead.

[Ron Josey:]

Thanks Christie and Ray congrats on the decision. We'll miss you that we have a few quarters and happy new year Aman. I wanted to ask a few questions maybe Aman on commerce that was the first pillar that you mentioned as a focus area with Poynt now websites and marketing adoption of the millions, I think new EC templates, I think our $23 billion in GMV, $7 billion of which through website and marketing. Can you talk to just a little more how you view ecommerce unfolding across Go Daddy going forward. The tools appear to be in place, you got the scale. So what's next? And then Ray, just real quick on the guidance with EBITDA flat year-over-year and I'm assuming that's continued investment in marketing and product, is that the way to think about it, thank you?

[Aman Bhutani:]

Ron, thanks for the question and yes, commerce continues to be our number one priority and you're right, you laid it out really well with websites plus marketing in place, Sellbrite also growing quickly, which you didn't mention, also huge opportunity for us in the WooCommerce space, we haven't talked about that much but you know about the SkyVerge acquisition that is helping us bring a program that we call a new Woo, that we'll talk about in the future as well. So yes,, all those things coming together Poynt adding those core capabilities as a payments facilitator invoicing point of sale and the idea is to bring all those pieces together and continue the pace of acceleration. If you just look at GMV for websites plus marketing and Sellbrite, the annualized number we gave you last quarter was much lower than the one you're seeing today and that itself represents quarter-over-quarter acceleration.

[Ray Winborne:]

Ron it's Ray. Appreciate the kind words first, but our normalized EBITDA margin were holding that flat year-over-year, which we're pretty pleased with given the investment we're going to put in place. Both in products, Poynt will be a big piece of that. I mentioned in the call comments that we've got net delusional about $20 million around commerce and we'll continue to invest more in marketing this year as well. So those are the two big drivers our normalized EBITDA margin.

[Christie Masoner:]

Our next question comes from the line of Ygal Arounian from Wedbush. Ygal, please go ahead.

[Ygal Arounian:]

Hey guys, thanks for the question and I echo the sentiment on Ray congrats. I am assuming that even big shoes to fill. I guess a couple questions, so first if we could just Aman you gave some good commentary on Prohub. Maybe if you could talk about the go to market strategy, I guess marketing around that, how the sales and customer service team will help drive that initiative and can you also talk about how many pros versus the outliers are using your services today. So maybe a little bit more just big picture around how that evolves. And then you domains I think outperformed and you talked a little bit about some of what's driving that. So how is the Neustar acquisition, the synergies you're seeing there, how much is that contributing? Can you talk about some of the things that you put in place specifically from that acquisition and how that can add to growth in the coming years?

[Aman Bhutani:]

Happy to take that, on pros, let's start with the numbers because I think that was in the middle of your question. We have about 1.5 million pros as part of our 21 million customers. So we already have a lot of pros that engage with us on a daily basis. We know that the opportunity is much, much larger and what the pro hub is about is it was about going to the pro scene, what do you guys need in terms of the interface and then building that in a manner that works best for them. And the go to market strategy around it, the Go Daddy program that at all about pro signing up and getting benefits, benefits that over time grow and there is a marketing campaign now in place in the US that is getting word out to say, hey, here is all the new things, the new experience where you can do a whole lot, you got project management tools, you got care with a click through messaging that our guides in the background, there are more guides in number. They have higher level of training and they can execute on more acts from the pros than ever before because we've opened up the aperture of what they can do. So it's the combination of both -- of all of those things that we're really excited about and then in terms of sales and marketing, no doubt care will continue to play a role there, but this is not an outbound motion and what we're really seeing is that pros want to engage with us on the web, they want to engage with care through messaging, they want to move things quickly, They don't even want to wait two minutes for a base load. They don't want to spend hours updating their sites. They want it done in one click and those are the type of capabilities we're opening up here. And then on domains, Ray will take the sort of contribution for Neustar, but just to remind you and it's still super early for us with Neustar, the innovation that we plan to bring to the table is all about having the full stack, being able to innovate on the registry side and the registrar side and bring new offerings and talked about that a little bit in the past. So I'll turn it to Ray to just talk about synergies and contribution as you asked.

[Ray Winborne:]

Yeah, Aman hit it on the head. This was more about the strategy and verticalization on domains. This is a future benefit to us as we get more control over the domain costs, which is one of our largest cost in the P&L. You think about contribution to the topline Ygal, the purchase accounting impacts from Neustar absolutely muted the impacts on the top line. If you're looking year-over-year, '21 contribution inorganic contributions for Neustar are going to be roughly half a point on the topline.

[Christie Masoner:]

Our next question comes from the line of Jason Helfstein from Oppenheimer and Company. Jason, please go ahead.

[Jason Helfstein:]

Thanks, kind of want to ask about acquisition and then leverage. So first point with a very strategic even acquisition but not particularly expensive. If we think relative to free cash flow you guys generate a year, if we think about kind of your acquisition pipeline, would you say more of the acquisitions look like point in site or are you potentially looking at something that might be bigger and then if not bigger, again given the amount of free cash flow you generate and how the company is very well positioned you're seeing very good customer retention. Why not leverage particularly in this environment we thought was the number one question we get investors, why not run this business at 3.5 to 4 times leverage and just accelerate kind of the free cash flow per share return to shareholders, thanks?

[Aman Bhutani:]

Thanks Jason. Maybe I'll start and Ray can comment at the end of that. One, I love the idea that you agree that the point is strategically important acquisition and it wasn't very expensive. Those are great acquisitions, I love them but to answer your question, we are looking at the who spectrum Jason. We absolutely agree that many of the core part of our strategy it's in my DNA, it's in the company's DNA. We're good at it. We've done it before but as we're out there looking at the assets as you know it's a competitive or sort of difficult time in the marketplace and we're trying to make sure that the assets we look at truly form part of the advantage we want to create because at the end of the day, what we're looking to have is that simple, intuitive experience. So there is million things I talk about Ray. I'm talking about ease-of-use. I'm talking about saving people time. I'm talking about product interfaces of that truly are magical that lead to high NPS and all the acquisitions we're doing or looking at big or small have to fit into that full. So I wouldn't have anyone think that we're not interested in large acquisitions. We absolutely are, but just we've got a formula we're working it and should be opportunity to you'll find us at the table and Ray, I'll turn it to you for levering up and such.

[Ray Winborne:]

Yeah Jason when you think about leverage, right, we've had a targeted two to four tons leverage since we've been public and we've been at the very top of that range when the opportunity presented itself and we've been more about balancing our capital allocation priorities. You saw every flavor of it in 2020. We leaned in the marketing, put a lot of money into organic growth because the opportunity presented itself. We closed on four acquisitions last year. We bought back stock and we also settled the TRA's. So we're really using that cash flow that incredibly strong and consistent cash flow that you talked about to drive significant returns for the company. And we do see the opportunity to Aman's point, we're certainly not hesitant to take our leverage to four times.

[Christie Masoner:]

Our next question comes from the line of Drew Glaser from JPMorgan. Drew, please go ahead.

[Drew Glaser:]

Hey this is Drew on for Sterling, thanks for taking my question. I was wondering if you could provide some more color on how much of the 2021 revenue growth is coming from acquisition?

[Ray Winborne:]

Hey Drew, it's Ray, when you look at the inorganic contribution on an incremental basis in '21, it's about a Poynt right. $20 million or so that's coming from Poynt, I just mentioned on I think it was a Ygal's question earlier that Neustar is about another half a point there. So those are the two big biggies that are contributing and it's around that one point contribution.

[Christie Masoner:]

Our next question comes from the line of Nick Jones from Citi. Nick, please go ahead.

[Nick Jones:]

One on premium, as you announced visitors for the site and people are converting to the premium offering, is there time to enter the freemium and eventually convert and then I guess when is some of the timing to conversion for freemium as they kind of when they convert to the site.

[Aman Bhutani:]

Nick, the question wasn’t totally clear, but I think I caught most of it. On freemium, what we're seeing is that customers do come in and the metrics we're looking at includes seven-day conversion and 90-day conversion right. There isn’t naturally fixed number of where everyone makes a decision. You continues to see a sort of the tale of people converting over time. Both the seven-day and 90-day, especially as we got into later in the year on the 90-day conversion, we started to have a few cohorts that were reasonable site and we continue to sort of see stable conversion in that 90-days rheum which is what we talked about. In terms of I didn’t fully catch this part of your question, but I think the objective of freemium for us is to open up the aperture to allow our customers without friction to try our products but we fundamentally believe that whether you look at websites plus marketing or Sellbrite, which we also turned freemium last year, the value that customers get compared to the price that we charge, really there is a tremendous amount of value and we want to remove any hesitation customers have of trying to use those products. These products are built from the ground up to the exact needs of our customers and we if feel we open up the aperture and get more customers to try that over time it's just going to build a greater and greater battery that leaves to better financial outcomes over time.

[Nick Jones:]

And one follow-up on M&A, you laid out dream create manage, we like that growing probably the pipeline is and where you're trying to focus in terms of essential M&A across the trends you laid out?

[Aman Bhutani:]

Our priorities on M&A are aligned with our broader priorities as a company and those priorities simply we are the leader in Dream and we absolutely have some intention there. We're making great progress in creating, that's fantastic, but we're putting disproportion about the time and energy resources integral and that's how our M&A team is prioritizing as well because actually create and grow off are more and more working together and that's a massive opportunity and when we talk about our $180 billion TAM, a huge percentage of that is within the growth phase. So that's where the majority of our energy is.

[Christie Masoner:]

Our next question comes from the line of Aaron Kessler from Raymond James. Aaron, please go ahead.

[Aaron Kessler:]

Maybe just on Q4 and that's at $1.4 million or so for the year. Any color on Q4 and that's maybe the linearity of the quarter and then also maybe for Ray and congrats you're taking some time off here and then the cloud transition maybe any updates on that and how this incremental cost was kind of a dual sourcing right now as well if you can lay that out, thank you.

[Aman Bhutani:]

Hey Aaron, I'll take both of those and Mark you can chip something. When you look at Q4 customer growth, still seeing record type levels. The momentum has been good and momentum has carried on into January. So nothing different in the trajectory that we've been seen at point. With cloud you saw some of the impact of cloud in 2020, showing or manifesting itself in lower capital expenditures because we have continued to move workloads into the cloud, that is pressure on the second outline, that's one of the investments we're making there, but if you recall back when we signed our contract with AWS, we were going to manage this thing to a cash basis and that's what we are continuing to do and that's one of the reasons we use unlevered free cash flow as our key metric there because the balance from normalized EBITDA down there, obviously includes the CapEx versus the OpEx up in the P&L.

[Christie Masoner:]

Our next question comes from the line of Mark Zgutowicz from Rosenblatt Securities. Mark, please go ahead.

[Mark Zgutowicz:]

Thank you. Aman, just a follow-up on your freemium comment, is it safe to say that the 90-day conversion you hope to do, hope to improve upon and if so what potentially are the missing pieces there and point can help and then appreciate the commentary in your presentation highlighting returns on your marketing spend last year. Just curious how those compared to the prior year and as you look into '21 sort of what consideration you're making in terms of absolute or relative spend and how Poynt perhaps fits into that picture, thanks.

[Aman Bhutani:]

Thanks, let me take freemium and a little bit on the marketing spend and perhaps Ray wants to comment on that as well. On freemium, I actually go back to the comments Mark that in the prepared comments, what we're seeing in terms of conversion is a rate that's higher than what we've seen in the industry. So of course it's still early in the journey for us, but that's really good, that's really comforting, it's what's the concerns that people may have had. But when I look at being able to improve conversion over time, absolutely we have people dedicated to doing that, but for me, the biggest things is I want to get it out broader and broader and broader right. I'd like to have it at a 100% in the US soon. I'd like to go global with it and that's what I'm really pushing the team because we know that at the end of the day, it's about attracting more people to our products and getting them to use our products because once they use our products, people see that we have something differentiated offer that it works in a manner that they didn't fully understand that Go Daddy would have that offering. And then in terms of marketing, Ray can talk a little bit about the numbers and the unit economics and how we've continued to sort of maintain our benchmarks and wants to break even, but I'd like to give you a little context of how I think about and the marketing spend and the approach there is one of there you want to spend up in marketing and have you spend up you have to continually improve your measurement, your ability to get into more and more channels and as you do that and you improve your internal capabilities to market better, you can then spend even more in marketing and I've talked about sort of this idea of improvement in growth and improvement in spend in the path and it's something that I have experienced with and I am pretty pleased with what I'm seeing in terms of Go Daddy in 2020 and what we have forecasted for 2021.

[Ray Winborne:]

Yeah I think as you look at what we've been spending on marketing, it's roughly 13% of revenue in 2020, but it's discipline right. We're disciplined in approach, we're disciplined in the execution of delivering the P&L and the P&L we've got a really good track record of investing in marketing over time with good returns and the strong unit economics that we've got. And we've trend with the team to stretch and look at the next marginal customer at an acceptable return that is all about balance. But when we do see that, we extend to pay that period and that does create more risk or higher risk profile for us because it does hit the bottom line in the short term but for the right paybacks we are willing to do that. You might notice in those slides that we put out with the earnings, we've put a new slide in for marketing with a different lens on how we see the returns. So we'll take a look at that but in summary, we did roughly $0.85 in incremental bookings and $0.45 in incremental gross profit in 2020 for every dollar that we spent on marketing and advertising. So when you compare that against other in the industry, that's going to shape up pretty well.

[Christie Masoner:]

Our next question comes from the line of Brent Thill from Jefferies. Brent, please go ahead.

[UnidentifiedAnalyst:]

This is John on behalf of Brent Thill, thank you. When you look at the newer products, websites plus marketing and manage work risk, then when you think about what's the relative sizing in growth rate size you seem it's achievable?

[Aman Bhutani:]

I'll give you a kind of a view into those website creation of products last quarter with an ARR of $350 million growing in the high 30s. We've continued to see strong growth in both of those metrics.

[Unidentified Analyst:]

Is there a way to differentiate between the two if it's an indication between the core and DIY at all?

[Ray Winborne:]

Both are doing strongly. Obviously we've put a lot more shouldering the websites and marketing recently. You heard Aman's comments earlier. One of the things we would point that is going to help us there is continue to push on commerce which will stretch into the manage WordPress and ecommerce offering as well.

[Christie Masoner:]

Our next question comes from the line of Naved Khan from Truist. Naved, please go ahead.

[Naved Khan:]

A couple of questions if I may. In terms of just your outlook, what are you baking in, in terms of potential synergies from points integration maybe later on in the year into your e-commerce packages and then another question just guidance related as well, how should we think about the drag from the social and outbound for this year? Is it material if it is and can you just call it out, thanks.

[Aman Bhutani:]

When you think about point synergies, we gave you guys some guidance around the top line and the bottom line. There is going to be investment year for Poynt. As we integrated into our offering we'll be spending money on marketing, spending money on product as well as experimenting across the front side of that. So that will be dilutive to the tune of $20 million in '21. On Social, think about that being ahead went through the first half and less so in the back, post our decision to pick up the outbound calling motion. So first quarter will be the highest headwind and then it starts to diminish as we move through the back half.

[Naved Khan:]

And then maybe just a quick clarification on the synergy comment Ray, so the curve you kind of gave us at the time of acquisition I think it's around $150 million in bookings by 2023. Should we expect any kind of revenue synergies to emerge this year at all or not?

[Ray Winborne:]

Yeah, you'll see some. This year is going to be a lot more focused on getting to market right. Payments will be first, but it's certainly not going to be linear. Next year 2022 will be more of the go to market strategy starting to drive revenue and then our expectation is we'll start to scale in three and that number that we put out sort of 150 in '23 should be a conservative number based off of what we're looking at.

[Christie Masoner:]

Our next question comes from the line of from Piper Sandler. Cart please go ahead.

[Unidentified Analyst:]

This is Cart on for Brent. Thanks for taking the question. I wanted to circle back to domain growth 14% another quarter of acceleration. I just wanted to dig in there, what is driving that growth? Is that all primary markets and if so, I see the dott.com and dot.net registration came down in Q4 but still at elevated levels. I guess what has given you the confidence from that guidance as double-digit growth for domain in 2021 and will there be any contribution from the new products for corporate domains or anything like that, that will be an offset.

[Ray Winborne:]

Yeah we're really pleased with the pleased with the performance in domains closing out 2020 with really solid growth and then obviously you saw the guide into 2021 continuing to see good strength and it is broad-based. That's the beauty of that business. Aman mentioned earlier, we own the dream phase of the customer journey. So it's strength across primary registrations. Renewals have been strong. We got aftermarket that is really doing well as we continue to improve the customer experience, but also the merchandising on front of site and in last, there is a modest contribution registry that I mentioned earlier roughly half a point on total revenue in 2021.

[Unidentified Analyst:]

And now that point is closed, I was wondering if you could frame the journey that for that company to come to payment facility you're in? How much of the offering the payment solution versus a third party profits and will you aggressive move to the internal solution for digital only commerce?

[Aman Bhutani:]

Yeah when we look at Poynt, obviously Poynt today has go to market strategy that's through a distribution channel, but when you see Poynt and Go Daddy together, obviously with Go Daddy's brand and 21 million customers and lots of folks being attracted to us with websites plus marketing, manage WordPress, which includes commerce on both sides, what we're excited about is bringing those pieces together and using the capabilities Go Daddy has and we have multiple capabilities to that. We have the opportunity to go direct to customer right because people know Go Daddy, they come into the sales path, they notice that the capabilities of there and it's seamless, it's integrated that works super well. We also work like I said with 1.5 million designers and developers right as we make the WooCommerce and WordPress ecosystems easier for them to you and we integrate these capabilities of payments and others into that experience, we think there's a great channel there for us to work with customers that we already have that work with other folks and give them the right incentives to sort of continue to fuel that pipeline. And then we always have Care right. We continue to have folks that call us, message us and although again we believe less in the outbound motion. So we're not talking about doing that but we do have a huge amount of inbound coming to us and that will continue to be a avenue for growth for us as well. So the incremental effort, the investment that we're putting in here, we think it's fantastic right and in terms of I think your question about using our internal systems, Poynt is already a payment facilitator. So we will be doing this ourselves right. It will not be -- that part will not be with a third-party.

[Christie Masoner:]

Our next question comes from the line of Ygal Arounian. Ygal, please go ahead again.

[Ygal Arounian:]

Hey thanks for taking one more. I wanted to come back to commerce and just ask with the Poynt acquisition maybe with some of what you're doing around Pro Hub and the greater focus just around commerce over the past yearend and into next year, you guys have always talked about your core customer as being the micro business. Does this change that at all or is it still kind of the same type of business, but those that are more focused on commerce and where you see what's becoming mid-level crowded but at least a more crowded commerce software arena? Where do you guys see yourselves competing the most?

[Aman Bhutani:]

Yeah Ygal, we are still laser focused on our customer segment. These are the micro businesses or the small of the small businesses folks that have 20 employees or less, 10 employees or less and in 2020 they have had to pivot online very, very quickly. I need to explain that I think you guys know that very, very well, but let me tell you just a small story. We did a -- we have a customer in the UK, they make vegan pies and the place is called Magpie and they just have a fantastic product and we got to know them, we love the folks that run Magpie and our marketing team decided to have to showcase them in one of our marketing campaign just to check out the ad, it's phenomenal. Well, here was what I imagine was a local place where people in the same neighborhood probably came to them and bought pies from them. Well, the day they went live in our advertising now they're shipping pies all over the UK right. By definition they are now a company that is online and we think that opportunity exists for every micro business, right. The Internet is the great equalizer. It allows customers to reach these micro businesses and with the toolset with the guidance we offer in Care, these micro businesses can absolutely provide the experience to their customers that is professional, that does the job in a manner that leaves their customer's impressed. So to your question, we focus on our customer segment, absolutely we're building all our products roundup for those customers and all those customers are going online. In our research, they clearly show that they want commerce and they want it online because anyone of them can be like Magpie.

[Christie Masoner:]

Our next question comes from the line of James . James please go ahead.

[Unidentified Analyst:]

Hey guys, this is actually Trevor on from the Barclays team. You're hosting in presence guidance for the full-year is high single digit while 1Q is mid-single-digit implying acceleration throughout the year. Is that just a matter of the tougher comp in 1Q or the updating impact from social and outbound as the year progresses, thanks?

[Ray Winborne:]

You answered your own question there exactly that, it's last year pre COVID, Social was growing and then second quarter, we started seeing the impact and then obviously beginning in the early July, we took out the outbound calling. So that's the progression you'll see as you move through 2021, but the implication in that guide was that we will see high single digits in that line.

[Unidentified Analyst:]

So could you exit the year at double-digit rates?

[Ray Winborne:]

Yes.

[Christie Masoner:]

Our next question comes from the line of Chris Kuntarich from Deutsche Bank. Chris, please go ahead.

[Chris Kuntarich:]

Just going back to the question before last, you talked about really how you guy's core focus is still on the businesses with 10 to 20 employees the micro-SMB segment. How do you think about driving more value in the product to the lower end specifically on the e-commerce product side versus driving value at the higher end just through the lens of websites plus marketing subscriptions? How do you think about driving pricing leverage and value to those customers differently that is, thanks?

[Aman Bhutani:]

Yeah Chris, these customers, we can definitely differentiate certain items and say look here are certain features that are better for these customers create more value and we have tears that different customers can talk, but I'd like to just bring it back to the idea that most of these customers are going online and doing commerce online in a significant way for the first time. Even the base set of features they need those to be super simple and what they really need is when they're confused to call someone and to get it to work just the way they want it. We've given the example in the past and I'll share a little bit of an update on it. We talked about how for the super small customers, the templates that create a one page commerce site when we created the first one, it just took off. It became the biggest thing right. We've now added more template and we find all of our customers going towards those templates because even I hate to call them bigger customers, but even customers that have 20 employees are learning their way through e-commerce and immediately they want to set the things where they're having trouble managing their inventory and they're calling us. They're having trouble taking what they're doing in the store to online and they need help and we're there or they want to manage between their online in-store and what they're selling on the major platforms and if that feedback that we're talking, we think okay, clearly these customers need the same thing which is they want from one place to be able to sell in their store, sell on their website and sell on any platform and hence you saw the Poynt acquisition us bringing together websites plus marketing, celebrate that we already own and the Poynt capabilities because we know that it works across the spectrum of customers we have and it's not really about truly separating out the value of sort of the top end of that or the bottom end of that.

[Christie Masoner:]

Thank you, everyone for joining us today. I'll turn the call over to Aman for some closing remarks.

[Aman Bhutani:]

Thank you, Christie. I'll just end with a thank you to all Go Daddy employees all around the world. 2020 brought many challenges for many of us at a personal level and I feel like every person leaned in to produce these fantastic results. Thank you all again for joining us and I look forward to talking to you next quarter.

[Christie Masoner:]

Good bye.