

AdultFriendFinder has filed for an IPO - vaksel
http://www.techcrunch.com/2008/12/23/adult-friendfinder-files-to-go-public/

======
brandonkm
Reading the S1 that they filed, they (obviously) are trying to offset the debt
they have through liquidation of their common stock. I can sum up the report
as "we are making lots of money, have fairly significant debt, we need to move
our shares now". AFF seems to be profitable and I see no reason why they
shouldn't go public. While they are generating pretty impressive revenues they
can also function as an umbrella in which adult oriented startups can fold
into. Possibly providing further value to their shareholders. This is actually
a pretty unique IPO , especially in the web sector.

I also think it will be entertaining to see AdultFriendFinder ring the NYSE
bell.

~~~
poshj
The reason why they shouldn't go public : very bad timing in this volatile
economy. I don't know if AFF can be categorized as startup, but startups that
do not have enough cash flow (the real cash) for 2 or 3 year of expenses and
etc should not go for public unless you want to get burned by short-sellers
and opportunist. I work part-time in Japanese startup in my leisure time. We
are only 10~ people (not all of us are developer) but already generating $4M
of net income last year(not try to brag on it, since I'm sure we're not the
best) and by the way we did end-year party last night I am pretty sure it's
more than doubled. We choose not to raise fund or sell IPO because we feel
steadier without it. Unless you have great growth that can ensure market
(remember, todays market is mostly based on fear) or you have great trouble
and IPO is the only thing that can save you, don't enter the market :)

------
acangiano
The perfect index symbol for them would be NSFW.

------
mattmaroon
I've always wondered how AFF can possibly maintain a number of users for long.
Even average women can just walk into a bar/bookstore/coffee shop/etc. and
find a man on any given night with very little effort, which means that site
couldn't have much of a selection of females participating. I assume the same
is largely true of gay men. So you're left with a large amount of straight men
looking for women that probably aren't there.

So I could see how they could lure in a lot of straight men with the promise
of casual sex, just not how they could keep the enormous churn rate down when
they found they were barking up an empty tree. Maybe they just haven't burned
through 100% of the population quite yet, and want to IPO so they can cash out
before they do, or maybe just a lot of people have lower standards (even when
sober) than I would have guessed. Or maybe AFF is nothing but a ruse to lure
men into porn sites they own, since you'd probably prefer it to your options
there.

~~~
ibsulon
Judging by the number of adultery stories I've heard here and there, I'd
imagine it's a few more than we'd expect. Females seem to use it for hooking
up, not for any sort of relationship, and it seems to be used especially if
one is already in a relationship.

As for gay men, there are many men who hate the idea of finding a hookup or
boyfriend in a bar. Gay.com has tons of users, myself included until I met my
boyfriend there about two years ago. While that doesn't affect AFF's
population (I haven't heard of gay people using it that much) I would imagine
the same is true for straight folk.

~~~
mattmaroon
Hmm, I would think adulterers would be less inclined to post their own picture
online where it could be more easily found. Perhaps they want to get caught I
suppose.

~~~
anamax
How does this "search for my spouse" work? (Our google friends aren't yet
doing face recog on images. When they do, lots of interesting things will
happen.)

~~~
mattmaroon
It's not a search. I know a guy, for instance, who was married and set up an
eHarmony account only to discover he was a match with his wife's best friend.
And much more common I'm sure is the cheater's spouse seeing something in
their email.

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kingnothing
Is adult friend finder even a legitimate business? I have always been of the
opinion that the vast majority of the ads for women are fake in order to get
men to sign up. After all, why would a woman post an ad on there when she can
just as easily go to, well, anywhere and find a random guy to hook up with?

~~~
jbjohns
Does the way people use your product determine if your business is legitimate
or not? If you did much IRC back in the day then you know that no such site
will _need_ to make fake women accounts to get guys to sign up. There are
enough people who get a kick out of pretending to be a girl just to prank
guys.

~~~
kingnothing
The business masquerades as a way for men to meet women to have sex with. If
all of the women are fake accounts made by employees, then I would not
consider it to be a legitimate business. In fact, I might go as far as to say
it's fraud, much along the same lines that shill bidding on ebay is fraud.

~~~
jbjohns
Did you read my comment? They would have to be incredibly stupid to make fake
accounts of hot women. Enough men/ugly women would do that for them.

------
strlen
AFF has been around for a while and had been one of the first personals sites
(recently they were sold to Penthouse who planned to take them to IPO).

When they were privately (and before being sold to Penthouse) they were still
very profitable and paid generous bonuses to employees (although they had a
fairly high churn rate due to the nature of their business). AFF, by the way,
is a big Perl shop.

I believe most of their income comes from pornographic portions that they
offer / affiliate programs (but I'd imagine the "adult personals" portion is
what draws its audience).

A friend worked at AFF and has a curious story about it:

Once in the early day's, my friend's manager (the company's founder) had been
asked by a former classmate if he could host a site for his start-up in
exchange for stock options. The manager refused. That classmate's name was...
Jerry Yang.

~~~
unrealwh
are you trying to tell me aff somehow predated yahoo? i'll file this story
under "bs" and you should too

~~~
strlen
1) Is that hard to believe? Yahoo only incorporated in 1995, there were start-
ups before that. Unfortunately, I can't find DNS records to back this up - FFN
domains seem to be registered with non-Verisign registrar which wouldn't have
been arround until 1998 (when third party registrars would have been
available).

2) AFF's founders could have already been hosting sites _before_ founding AFF
(indeed, it would logically follow that he'd have experience running a site
before launching a successful company).

EDIT: Here's some proof:

Conru.com is registered wih Verisign and on 03-NOV-94 (Andrew Conru is the
founder of AFF and you can see the FFN address and name when doing 'whois
conru.com'). Yahoo.com is registered 18-JAN-1995 (do "whois '=yahoo.com'" to
check). Seems like it's at least plausible (Stanford is a small place).

------
YuriNiyazov
AFF is part of an umbrella organization called FriendFinderNetworks, which you
will find at <http://ffn.com/>

Over there, you will see that the same company runs a number of
age/gender/ethnicity specific networks (GayFF, AsianFF) and even a Christian
dating site called "BigChurch.com" Also, the nerve.com personals section is
run by fastcupid.com, which is also owned by FFN.

I think that perhaps a large part of the "ew" factor in this (and many other)
threads come from the idea that enough money to warrant an IPO can come from
such 'seedy' business as facilitating one-night stands, but in my mind it is
quite questionable whether the vast majority of the income comes from the one-
night-stand part of their business.

In fact, I am willing to bet that it is not. It seems plausible to me that the
number of people who simply are not meeting a partner that meets their
criteria is on par with the number of people who require one night stands.

------
bayareaguy
_The primary use of the proceeds from the IPO, the company says, is to pay off
the nearly half billion dollars in debt on its books._

So they're only going to take money from new "investors" to pay off the old?
Sounds like another Ponzi scheme to me.

~~~
jbjohns
Um, no? They're going to _sell_ a part of their company to pay off their
debts. But if you still don't see the difference just realize that they can
only sell so many percent of their company until they have nothing left to
sell and the company belongs to someone else.

------
chicsavvy1
I suppose it is but now they have set a new thing--when sending a message the
default is set to use 100 points everytime by letting you know when the person
has read the message. I once had 1564 points--now I have 864 because of the
new default. I complained and they restored 200 but what about the rest? I
don't care when my message is read but if I did, I would click on the box so
that I WOULD know. Another way to rip you off, huh?

------
jdavid
this is good news, i think. not that AFF, is a great business, but simply
adding to the IPO count will help others do the same.

i am still of the opinion that a majority of the funds in the hedge markets
had cash conserved during the down turn. if this goes well, then it will show
that there is money out there.

on another note, in down times, entertainment seems to do better and this
might be the only time that an adult website could grab the attention of
investors.

~~~
lnguyen
The problem is if it crashes and burns, it turns into some sort of referendum
on how IPOs are "doomed" in this economy and possibly also for quite some time
in the future. I'd rather see a better company and one that doesn't carry a
stigma (rightfully or wrongfully) that could prevent wide public investment be
that bellwether.

Unfortunately those companies are probably staying away from even thinking IPO
at this time.

------
Prrometheus
I wonder how they managed to rack up $500 million in debt?

~~~
rmaccloy
Penthouse bought AFF from the founding company for ~400mm -- if you glance at
the S1:

Long-term debt classified as current due to events of default, net of
unamortized discount(3) 411,019 (in thousands)

"In their report dated December 22, 2008, which is also included in this
prospectus, our independent registered public accounting firm stated that
events of default have occurred under certain of our debt agreements allowing
noteholders to demand payment of our 2005 Notes and 2006 Notes and our
subsidiary’s First Lien Senior Secured Notes, Second Lien Subordinated Secured
Notes and Subordinated Convertible Notes (each as defined herein) and that
these conditions raise substantial doubt about our ability to continue as a
going concern."

------
jorgeortiz85
And everyone says Sarbanes-Oxley killed the IPO market...

~~~
byrneseyeview
...if the only consumer Internet companies going public are ten years old and
issuing stock to recapitalize rather than to grow their business, yes.

------
awt
I once had a roommate who worked atadultfriendfinder.com. He was kind of
weird. One of the types who never left his room, etc.

~~~
awt
Truth hurts?

~~~
edu
irrelevance hurts.

------
jm4
Who cares? Seriously... Adult Friend Finder? Don't even give me some crap
excuse about how it's relevant because they're a startup. These guys have been
in business, ripping people off since '96. Someone submitted an RFC for an
avian IP network earlier today and now this. It's way too early to be posting
April fools stuff.

vaksel, you really need to stop submitting everything that pops up in the
TechCrunch RSS feed. I'm starting to wonder if you're some kind of sock puppet
for them. It's already bad enough that we have to see any of their articles
here at all. Their so-called reporting is so bad I don't even know where to
begin. At least have the decency to filter out the obvious garbage like this.

~~~
vaksel
having something so crappy go for an IPO is news enough for me

~~~
jm4
I don't even know how to respond to that. What are you trying to say? That
this should be some kind of inspiration to readers here? There's hope that
one's startup can eventually go public if AFF can do it?

A twelve-year-old casual sex meetup site is successful enough that they're
going to start selling stock to the public. Stop the presses! Sex sells!

I really don't see what this has to do with hackers, entrepreneurs or HN.

I also find it somewhat ironic that you-- only a month ago-- submitted a poll
asking users if they felt HN should be invitation-only in order to improve the
quality of submissions.

<http://news.ycombinator.com/item?id=373789>

"Seems like the site is growing by leaps and bounds...and slowly losing the
quality we've all grown to rely on."

Sheesh...

~~~
Mazy
This is absolutely relevant to entrepreneurs and HN. This is a real web
business with real revenue really going public.

