Penthouse Magazine Acquires Internet Social Network Giant Adult FriendFinder for $500 Million

While I was busy boasting about the massive earnings I was making from my own adult dating site, fuck-buddies.com, Andrew Conru was busy making a much bigger deal…..

AdultFriendFinder.com is the biggest adult personals site on the internet, and after much speculation Its owner and founder Andrew Conru accepted $500M CASH!

Dec. 12 PRNewswire

Penthouse Media Group Inc.,
parent to Penthouse Magazine, one of the world’s leading men’s lifestyle
publications and producers of online, licensed and broadcast content and
materials, announced today that it has acquired internet social networking
giant Various, Inc. and its subsidiaries for $500 million in cash and
securities. With $340 million in projected combined 2007 revenues, this
acquisition makes Penthouse the largest adult entertainment company in the
world.

Various has an extensive affiliate network, as well as a rapidly
growing member base of more than 260 million consumers and a total paid
subscriber list in excess of 1.2 million. Various operates more than 25
online communities including adultfriendfinder.com, which is a top 50 Web
site nationwide. Adultfriendfinder.com is one of the most highly trafficked
Web sites in the world with more than 18 million members.

full story

For me there are a few very interesting points about this story:
1) Though $500M sounds like a massive amount, I estimate it is only approx 3 - 4 times the EBITDA, very low for an internet company which normally see multiples from 15+. This has got to be because of the adult nature of the business hugely reducing the number of potential buyers. Also another factor must have been that only a day before the sale the Federal Trade Commission (FTC) restricted AdultFriendFinder’s promotional activities.
2) Andrew Conru never wanted to own the largest adult site in the world! It came about by accident after launching FriendFinder… This highlights my reasoning for being involved in adults dating, there is simply huge demand for it!
3) What will happen to all of Various Inc’s other properties, not only main stream sites, but sitse such as BigChurch… I cannot imagine that its members will be delighted about financing the porn giants Penthouse!

All very interesting news, especially for anyone interested in online dating or aspiring to be a porn mogul!