OnlyFans has become one of the most popular platforms for adult entertainment, and that is why investors are pondering investing in OnlyFans stock. OnlyFans is a premium subscription service where content providers may monetize their content.
Creators can lock their content, allowing fans to access it for a monthly or one-time payment. The platform, which was created in 2016 by British IT entrepreneur and investor Timothy Stockley, currently has over 30 million registered users and 450,000 content providers. Making it one of the most popular content creation platforms online today.
Since its inception in 2016, OnlyFans has paid out over $600 million to creators. Creators can charge their followers a monthly subscription fee ranging from $4.99 to $49.99 per month. OnlyFans retains a 20% commission.
Creators can also create free sites and charge viewers to access pay-per-view content. Other creators have a free page as well as a subscription page in order to diversify and optimize their income.
History of OnlyFans
OnlyFans was launched in 2016 as a social network for performers to have their subscribers see videos and photos for a monthly fee. In October 2018, Leonid Radvinsky, owner of MyFreeCams, became the owner of more than 75% of the shares in parent company Fenix International Limited, becoming a director in November 2018.
As of May 2020, the site had 24 million registered users and claimed to have paid $725 million to its 450,000 content creators. In May 2020, CEO Tim Stockley told BuzzFeed News, "The site has around 200,000 new users every 24 hours. Seven to eight thousand new content creators sign up every day".
Although the National Center on Sexual Exploitation claims a negligible number of incidents compared to Facebook. As the site has been criticized for uploading child sexual abuse content. In August 2021, a campaign to prosecute OnlyFans began in the United States Congress.
Owing to external demands, OnlyFans declared on August 19, 2021, that it will no longer accept sexual content beginning in October 2021. However, this decision was reversed six days later due to how badly users received the news. In December 2021, Tim Stockley announced that he was stepping down as CEO and would be replaced by Amrapali Gan.
Because the number of OnlyFans members continues to rise on a daily basis, many prominent actresses such as Cardi B, Bella Throne, and others have joined the site.
Is it possible to invest in OnlyFans stock?
Since OnlyFans is privately owned and controlled by Fenix International Limited, it is not listed on a stock exchange. As a result, it is not possible to acquire any shares at the moment.
Investors may be interested in purchasing OnlyFans stock as a result of the company's growth, and OnlyFans' exponential development may provide them with cash. It's tough to predict whether OnlyFans will go public and make their shares available for purchase by others.
Will there be an OnlyFans stock IPO?
It is impossible to predict if there will ever be an OnlyFans stock IPO. On one hand, there is demand from investors, that see the business model thriving, as the company continues to grow and attract users.
On the other hand, institutional investors are limited to investing in some industries. For those reasons an OnlyFans stock IPO would be the company’s last resort to raise capital if it cannot use traditional financing options.
OnlyFans' competitors, such as Twitch, Snapchat, TikTok, and Instagram, are growing as the demand for video-led content rises.
It will be interesting to see how the OnlyFans business model will shift over the coming years, and what improvements will be made to the platform. It is crucial that it continues its growth trajectory, and keeps adding users at a fast pace.
TikTok, Snapchat, Instagram, and even YouTube rely heavily on advertising to generate sales. Despite the fact that its primary source of revenue is subscription-led subscribers. So OnlyFans' task is to ensure that the appropriate quantity of subscribers is always present, and keeps growing.
Who owns OnlyFans?
The creator, Tim Stokely, and adult industry expert Leo Radvinsky, an adult live stream business entrepreneur who bought a controlling position in OnlyFans in 2018, are the key shareholders.
According to Bloomberg on June 16th, 2021, OnlyFans was seeking venture capital at a valuation of more than $1 billion.
On August 19th, 2021, Dan Primack of Axios stated that the firm is failing to acquire venture capital investment because of the explicit content posted by producers. Some venture capitalists are not allowed or are inclined to invest in the adult entertainment industry.
The company's ownership is centralized at the top, and it has not pursued venture investment. Fast-growing businesses frequently seek outside money from venture capital firms to assist drive expansion. Nevertheless, the corporation makes roughly 12% of its turnover in profit, according to some reports.
Profits can thus be re-invested to drive expansion. If the firm requires more funds to grow, it may always seek private finance. Private investors will ultimately need liquidity, which may facilitate an OnlyFans stock IPO.
OnlyFans might potentially value the company privately to determine its worth before going public. In addition, the owners may seek to obtain funds through an OnlyFans stock IPO rather than through private fundraising.
Does OnlyFans have any competitors?
Since OnlyFans works in such a narrow industry on the internet, it is difficult to find direct competitors. There are other social media sites that may be considered rivals in terms of content development.
TikTok, Instagram, Snapchat (NYSE: SNAP), and Amazon-owned Twitch are a few examples (NASDAQ: AMZN). Facebook (NASDAQ: FB) launched its own content development subscription model in July.
It assists content providers who submit media to their Facebook profiles. While it hasn't received much attention so far, we do know that Facebook has a clear no-nudity or adult material policy on all of its pages. In terms of publicly traded firms, Snapchat is arguably the closest approximation to competition. Until, of course, a firm like TikTok goes public.
There aren't many adult entertainment enterprises that are publicly listed. One of the originals, Playboy, is returning to the public markets through a SPAC IPO with Mountain Crest Acquisition Corp. (NASDAQ: MCAC). As a result, we might see the market interested in an OnlyFans stock IPO or even SPAC.
Are there any concerns with the business model?
It is very evident that there are no problems with OnlyFans’ business model. For starters, as previously said, they have no direct competitors, and corporations with funds on hand to make fresh investments are not accessible to build a competitor to Onlyfans.
It's certain that Facebook, Microsoft, Apple, and any other industry titan would prefer not to be associated with the adult entertainment industry. Moreover, OnlyFans has grown in popularity in recent years. The number of new accounts is growing at an unbelievable rate. In December 2020, Onlyfans added 500,000 new members every day.
According to Thomas Stokely, the platform's chief operating officer, it has attracted an average of 8,000 new content producers every day. OnlyFans has a great potential to continue its growth.
The company appears to be financially sound, despite the hurdles in getting financing from some financial institutions that do not want to be related to this industry. However, the information is unclear since the company is privately operated.
According to Financial Times research, the company made over $74 million in pre-tax profit between November 2019 and 2020.