943: Finding the Path Forward | Donald McClure, CFO, Identity Digital

“We ended up negotiating a prepackaged restructuring, whereby we utilized the Chapter 11 process but at the same time sort of did all of the work in advance,” recalls McClure, who tells us that he quickly became the newly hired CFO’s “Number Two.”

Whether it was while consulting with the firm’s general counsel or with its CEO, McClure’s CFO kept him ringside as they together educated others as to the ongoing process and its desired outcome.

“We were telling the story of the company in an environment where we were not just trying to refinance but also taking the constraints off to ask, ‘What is the right capital structure for this business?,'” reports McClure, who notes that multiple financing partners were being engaged at once.

“At one point, we had four different types of debt and various stakeholders at the table trying to help us to figure out how we were going to structure this—it was really eye-opening in terms of understanding the importance of what we were doing and how the stakes were real,” explains McClure, who adds that once the restructuring was in his rearview, he felt that it was time to move on.

Says McClure: “I knew that my work would be kind of done at this point, so I had been looking around and was able to find a company looking for a CFO.” –Jack Sweeney

“Don’t rigidly plan your career by focusing too much on a destination many years down the road. Keep more of a 3- to 5-year outlook. Stay open to opportunities that build experience but might take you down an unexpected path that aligns with your interests and furthers your career in a direction that you didn’t anticipate.” –Donald McClure, CFO, Identity Digital

We own about 270 of these. We sit at the wholesale level, making these virtual real estate spaces available to the world. To obtain one, you would go through a registrar such as GoDaddy, which is a a customer of ours. You go to GoDaddy or our own registry and register a domain. We make the infrastructure behind this work so that if you type in this domain, you’re linked to the right place. This is a little-known corner of the Internet that is actually really interesting. It’s a recurring revenue business, very high-margin. We’re sort of a rule of 70 company.

Over the next 12 months, we’re going to finish the synergy capture and integration of some M&A that has been done in the past. This has been a long time in coming. We’re investing significantly in marketing and business development to try to figure out new ways to create customer relationships and unlock new ways to use domains more broadly. These are the big operational focuses.

On my side, we don’t necessarily have a mandate to go public as our exit and could very well do other things, but I am undertaking a gradual IPO preparedness strategy just to make sure that we’re shoring up the things that a company our size should be doing anyway, now that we’ve combined another business with ours, to be certain that we’re ready to go down this path if and when the opportunity presents itself. Sometimes, as you know, this window just opens up. Sometimes your investors say, “Let’s go, let’s do it!” We’ve been working behind the scenes to get as ready for this as we can, doing things that we would want to do even as a private company—but we’ll be ready to take this next step if we need to.

jb