AdultFriendFinder has filed for an IPO

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

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.

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.

Truth hurts?

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 :)