Why Phoenix Small Businesses Should Avoid GoDaddy for Microsoft 365 (and What to Do if You’re Already There)
If you’re a small business in Phoenix looking for email and Microsoft 365, chances are you’ve seen GoDaddy’s offers. It looks simple: buy your domain, add email, and you’re done. But here’s the truth: starting your business email with GoDaddy creates long-term headaches, hidden costs, and limits your ability to manage IT the right way.
At TechMait Solutions, we see this story all the time: a business launches with GoDaddy email because it’s “easy,” only to realize later they can’t take advantage of the full Microsoft 365 ecosystem without extra work.
Let’s break it down.
The Problem with GoDaddy + Microsoft 365
On the surface, GoDaddy resells Microsoft 365. But behind the scenes, they set up what’s called federation. That means your email and Microsoft accounts are tied into GoDaddy’s system, not directly into Microsoft’s cloud.
Why does this matter?
Limited features – You don’t get the same admin controls, security, and integrations you would with a direct Microsoft 365 tenant.
Harder to grow – As your business adds employees, devices, or compliance needs, GoDaddy becomes a bottleneck.
Migration headaches later – Moving off GoDaddy isn’t as simple as flipping a switch.
If you’re just starting your Phoenix business, don’t go down this road. Start with a direct Microsoft 365 tenant. You’ll get more control, better security, and a foundation that grows with you.
But what if you’re already stuck on GoDaddy? That’s where you have some options.
Option 1: Defederation (Keep Your Tenant, Break from GoDaddy)
Defederation is the process of cutting the tie between your Microsoft 365 tenant and GoDaddy’s identity system. Your email, files, and accounts remain in place, no data is migrated, but the tenant becomes fully under your business’s control in Microsoft.
What to expect:
Users keep their mailboxes, but all need new credentials after the change.
Your tenant now looks and works like a direct Microsoft 365 tenant, with better admin controls and security options.
The quirks don’t completely disappear: things like odd SharePoint/OneDrive URLs with GoDaddy naming conventions will still stick around.
Defederation is best for very small teams (1–3 users) who just want to break free from GoDaddy without the extra lift of a migration.
Option 2: Migration (Clean Start, New Tenant)
Migration is the more comprehensive approach. Instead of keeping the GoDaddy-created tenant, we set up a brand-new Microsoft 365 tenant under your control and move everything: email, contacts, calendars, and OneDrive files, into it.
What to expect:
A completely clean slate with no GoDaddy baggage.
Data is moved with migration tools and tested for accuracy.
Users get fresh logins, and we handle the cutover of DNS to ensure mail flow continues.
Migration is best for businesses with 5+ employees, those planning to grow, or anyone frustrated by the leftover GoDaddy quirks. It takes a little more planning but creates the cleanest, most future-ready setup.
Build on the Right Foundation
Your business email and Microsoft 365 tenant aren’t just tools, they’re the foundation of your IT environment. Starting with GoDaddy is like building a house on sand. It might look fine at first, but cracks show fast.
By moving to Microsoft 365 directly, you’re setting your Phoenix business up for security, scalability, and success.
Ready to break free from GoDaddy? Contact TechMait Solutions or Book a Call today to explore your options and get your business on the right IT roadmap.