Web.com Group has everything a growing business needs to create a presence on the Internet. The company provides website building, custom design consulting, and Web hosting services. Its Register.com business provides domain name registration, and its eWorks! XL product offers initial site-design setup and online marketing and technical report services. SmartClicks also offers search engine optimization and local pay-per click advertising services. The company sells to almost 3 million small and midsized US businesses, mostly on a subscription basis. In late 2011, Web.com significantly expanded its customer base through the purchase of Network Solutions, a website services and domain-names registration firm.
Through the company's eWorks! XL program, Web.com's goal is to have a website visible on the Internet for the customer within 72 hours of receiving the customer's initial information. The program offers a wide assortment of services and products, including the purchase and registration of the domain name, online marketing applications, Web mail, and hosting and technical support.
Intent on serving small to midsized businesses, Web.com has taken a number of actions to position itself as the place for clients to get what they want from the Internet -- from a minimal presence to an entire plethora of website, e-commerce, and e-marketing campaign options. The company has recently grown its operations through several significant purchases.
Perhaps its most important acquisition occurred in October 2011, when Web.com obtained Network Solutions for $560 million in cash and stock. The deal gave an affiliate of private equity firm General Atlantic ownership of 37% of Web.com's shares. It also doubled Web.com's revenue and tripled its subscribers base (skyrocketing it from around 950,000 customers to approximately 3 million).
Web.com previously beefed up its domain name registration operations through the 2010 purchase of Register.com for $135 million, in a deal that created one of the largest Internet services companies serving small businesses. Register.com specializes in the registration of Web domains ending in .com, .org, and .net. That purchase initially gave Web.com an additional 787,000 subscribers, but it also took a heavy toll on its cash flow throughout the year. In order to finance the Register.com purchase, the company borrowed $115 million and still had about $103 million in debt remaining by the end of 2010. (The high cost of revenue and high expenses were main reasons for Web.com's net loss of $6.5 million for 2010.)
To fortify its e-commerce offerings the company obtained Solid Cactus in 2009. Solid Cactus provides website and e-commerce store design and programming services as well as search engine optimization, email marketing management, and call center services. Also in 2009, Web.com sold its NetObjects Fusion software business, which helped customers design their own websites. The company divested the unit in order to stay focused solely on its subscription-based products and services.