Moelis & Co. to help OnlyFans sell majority stake – Business News
Talks to sell a majority stake in OnlyFans are being led by Moelis & Co., the investment bank based by Wall Street legend Ken Moelis, The Post has discovered.
Moelis bankers engineered the potential deal for the money-minting smut web site – during which San Francisco-based Architect Capital might take a 60% stake in a tie-up that values it at $3.5 billion – after no less than one different bank shied away from representing OnlyFans, mentioned a source aware of the matter.
Moelis – whose 68-year-old, billionaire founder was a protege of junk bond king Michael Milken – hopped into mattress with OnlyFans after the London-based porn platform failed to discover an eligible suitor over a lot of the previous yr, mentioned two people with data of the potential deal.
Talks to sell a majority stake in OnlyFans are being led by Moelis & Co., The Post has discovered. AFP through Getty Images
Ditto for top-tier investment banks, who proved to be squeamish about dirtying their palms with the porn business, insiders mentioned.
“The company had been struggling to find a buyer largely because of the porn stigma. But it has incredible financials that are very attractive,” one of the sources instructed The Post.
“Everyone has to make decisions about balancing business potential with negative associations and Moelis has made their feelings clear.”
Moelis, Architect and OnlyFans declined to remark.
OnlyFans has confronted legal issues for years. In one high-profile case, a lady claimed in a 2022 Florida lawsuit that she was raped by two males who posted a video of the act to OnlyFans, charging a month-to-month subscription to view it. The plaintiff mentioned OnlyFans violated the Trafficking Victims Protection Act by facilitating the publishing of the video and for profiting off it.
Moelis – whose billionaire founder Ken Moelis (above) was a protege of junk bond king Michael Milken – hopped into mattress with OnlyFans after the London-based porn platform failed to discover an eligible suitor over a lot of the previous yr. REUTERS
OnlyFans disputed the allegations and a decide in the end dismissed the claims, citing Section 230 of the US Communications Decency Act that broadly protects web sites from legal responsibility for user-generated content material.
In 2023, a whistleblower filed a grievance with the US Treasury Department’s Financial Crimes Enforcement Network alleged Mastercard and Visa failed to stop their networks from laundering funds from baby sexual abuse materials and intercourse trafficking on OnlyFans, in accordance to a Reuters report.
A Mastercard spokesman mentioned the credit card giant has zero tolerance for criminality on its community. Visa didn’t instantly reply to a request for remark.
A spokesperson from Treasury’s FinCen unit declined to touch upon confidential whistleblower submissions however mentioned it really works with financial establishments and law enforcement to forestall illicit exercise.
Moelis is now on the heart of deal talks with Architect, particulars of which had been reported final month by The Wall Street Journal.
OnlyFans has confronted legal issues for years. diy13 – stock.adobe.com
“It’s not surprising that mainstream financial institutions are finding the impressive financials of so-called vice companies too enticing to pass up,” mentioned Catharine Dockery, the founder and common accomplice of New York-based Vice Ventures, which invests in startups in stigmatized industries together with alcohol, psychedelics and intercourse merchandise.
In the enterprise market, traders are more and more warming up to companies that had been traditionally shunned, she added.
Moelis is led by Navid Mahmoodzadegan, one of the bank’s co-founders, after Moelis stepped down as CEO final fall, transferring into an govt chairman function.
Architect’s high brass is no stranger to controversy. Founder and CEO James Sagan has been a key investor in e-cigarette company Juul Labs, which was blamed for igniting a teen vaping disaster and weathered years of legal battles.
Architect’s head of technology, Hoan Ton-That, joined the firm final yr after founding Clearview AI, which has scraped thousands and thousands of images off Facebook and LinkedIn and bought them to law enforcement businesses. The company has been banned in a number of nations in Europe, in addition to in Australia, in accordance to authorities rulings in these nations reviewed by the Post.
Architect’s head of technology, Hoan Ton-That, joined the firm final yr after founding Clearview AI. Patrick McMullan through Getty Images
OnlyFans earned $666 million in working revenue on $1.4 billion in income within the yr ended Nov. 30 2024, in accordance to UK company filings. The company logged $449 million of gross sales prices and $197 million of administrative bills. OnlyFans had solely 46 staff, the filings show. About 64% of its income is generated within the US.
OnlyFans proprietor Leo Radvinsky, who bought a majority stake in 2018 for an undisclosed quantity from its British founders Tim and Guy Stokely, has earned practically $1 billion in dividends over a two-year period ending Nov. 30, 2024, the filings show.
OnlyFans takes a 20% cut from its roughly 4.6 million creators, per the filings and the positioning will not be on App shops so no income is shared with Apple or Google.
Still, a report this yr by fee processing company Myntpay discovered that retailers offering grownup content material get dinged with greater transaction charges – typically 5-10% per transaction in contrast to 2-3% for conventional e-commerce – which might translate to a price low cost come time for a sale or public itemizing.
OnlyFans, which is owned by dad or mum company Fenix International Ltd, had engaged in talks for a sale final yr at an $8 billion valuation to a group of traders led by Los Angeles investment firm Forest Road Company. That deal by no means got here collectively.
