ValleyWag Unzips AdultFriendfinder Scandal
Posted By Jeff on March 2, 2009
As a reporter in Silicon Valley, you probably can’t have a LOT more fun than breaking a story involving Penthouse Pets serving ice cream and investment bankers getting lapdances in the middle of Security and Exchange Commission “quiet period” on a proposed $500M initial public offering.
Not unless Steve Jobs has a hangnail or something, anyway.
But as Owen Thomas reports in ValleyWag, in the latest chapter of a long, strange saga:
Friendfinder’s Latest Scandal Sexier than A Penthouse Letter
I could quibble. I’ve read quite a number of hot Penthouse letters. Lapdancers? Penthouse Pets? Peh. None involved a $500M IPO, though …
According to ValleyWag, Natalie Cedeno, the company’s former HR director, says that company executives fired her last month in retaliation when she pointed out violations of labor laws. She’s suing, and her account of the culture clash between AFF and Penthouse executives after the latter bought the former is already epic.
The company, now known as Friendfinder Network (FFN), has been teetering financially despite having been enormously profitable, laden with a mountain of debt related to the purchase. The Wag notes that:
If the company has legal problems and labor issues beyond what it disclosed in its SEC filings, its executives could face heavy penalties, and the IPO would likely be scotched.
Funny that ValleyWag persists in identifying FFN as a porn company, though. Even they should know that a porn company isn’t worth anything like $500M and that FFN makes relatively little from selling porn. It’s memberships and adult social networking, dudes.
I can’t see how this has an impact on FFN consumers quite yet. Regardless of whether Penthouse can pull off the IPO, investors or creditors are unlikely to shut down the company’s web sites and turn off the revenue spigot.
From my own perspective — AFF has always been the biggest story in sexual networking, though it has diminished. I’ll take no pleasure if it crashes and burns. It’s not a better story that way.
But it’s obvious that there will be plenty of people willing to tell that story now. At one point in time, about 18 months ago, I was told by an agent that worked for Vivid Entertainment (now THAT’S a porn company) that Vivid would be handling the rights to a book about Adultfriendfinder; I was invited to compete for the right to, well, write that book. The implication was that there was going to be one person telling the story, a story approved by AFF and Vivid. I somehow doubt that selection process ever took place.
The whole thing will spill out in myriad ways, now, until the end.
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