Enom 2011 Annual Report Download - page 46

Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations
Forward Looking Statements
The following discussion and analysis of our financial condition and results of operations should be read in conjunction with Part II, Item 6, "Selected
Financial Data" and our consolidated financial statements included elsewhere in this Annual Report on Form 10-K. In addition to historical data, this
discussion contains forward-looking statements about our business, operations and financial performance based on current expectations that involve risks,
uncertainties and assumptions. Our actual results may differ materially from those discussed in the forward-looking statements as a result of various factors,
including but not limited to those discussed in "Disclosure Regarding Forward-Looking Statements" and Item I, Part 1A, "Risk Factors" included elsewhere
in this Annual Report on Form 10-K.
Overview
We are a leader in an Internet-based model for the professional creation and distribution of high-quality, commercially valuable, long-lived content at
scale. Our business is comprised of two distinct and complementary service offerings: Content & Media and Registrar. Our Content & Media offering is
engaged in creating media content, primarily consisting of text articles and videos, and delivering it along with our social media and monetization tools to our
owned and operated websites and to our network of customer websites. Our Content & Media service offering also includes a number of websites primarily
containing advertising listings, which we refer to as undeveloped websites. Our Registrar is the world’s largest wholesale registrar of Internet domain names
and the world’s second largest registrar overall, based on the number of names under management, and provides domain name registration and related value-
added services.
Our principal operations and decision-making functions are located in the United States. We report our financial results as one operating segment, with
two distinct service offerings. Our operating results are regularly reviewed by our chief operating decision maker on a consolidated basis, principally to make
decisions about how we allocate our resources and to measure our consolidated operating performance. Together, our service offerings provide us with
proprietary data that enable commercially valuable, long-lived content production at scale combined with broad distribution and targeted monetization
capabilities. We currently generate the vast majority of our Content & Media revenue through the sale of advertising, and to a lesser extent through
subscriptions to our social media applications and licensing and sales of select content and service offerings. Substantially all of our Registrar revenue is
derived from domain name registration and related value-added service subscriptions. Our chief operating decision maker regularly reviews revenue for each
of our Content & Media and Registrar service offerings in order to gain more depth and understanding of the key business metrics driving our business.
Accordingly, we report Content & Media and Registrar revenue separately.
In January 2011, we completed our initial public offering and received proceeds, net of underwriters discounts but before deducting offering expenses, of
$81.8 million from the issuance of 5.2 million shares of common stock. As a result of the initial public offering, all shares of our convertible preferred stock
converted into 61.7 million shares of common stock and warrants to purchase common stock or convertible preferred stock net exercised into 0.5 million
shares of common stock.
For the years ended December 31, 2009, 2010 and 2011, we reported revenue of $198 million, $253 million and $325 million, respectively. For the
years ended December 31, 2009, 2010 and 2011, our Content & Media offering accounted for 54%, 61% and 63% of our total revenue, respectively, and our
Registrar service accounted for 46%, 39% and 37% of our total revenue, respectively.
Key Business Metrics
We regularly review a number of business metrics, including the following key metrics, to evaluate our business, measure the performance of our
business model, identify trends impacting our business, determine resource allocations, formulate financial projections and make strategic business decisions.
Measures which we believe are the primary indicators of our performance are as follows:
Content & Media Metrics
• page views: We define page views as the total number of web pages viewed across (1) our owned and operated websites and/or (2) our network of
customer websites, to the extent that the viewed customer web pages host the Company's monetization, social media and/or content services.
Page views are primarily tracked through internal
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