The Toronto-based parent company of AshleyMadison.com is once again taking a stab at listing shares on a public exchange, this time aiming for London in a wager that a stock market in liberal Europe will be more amenable to listing a fast-growing company whose goal is to facilitate adultery.
Avid Life Media, which also owns the CougarLife.com and TheBigandtheBeautiful.com sites, among others, tried but failed to go public in Toronto at the height of the financial crisis when it was also a much smaller company. Now Avid Life is giving it another go, pointing to its revenue growth since then, and its international expansion plans.
While the company gets more than half of its revenue in the United States and Canada, it would be hard to find support in North America for an IPO there, an executive told Bloomberg News, hence the decision to aim for more liberal London, where Avidlife is gunning for a $200 million offering later this year. That executive thinks Avid Life is worth $1 billion. (To be fair to North American investors, it might not just be prudishness at play here. Sex-themed stocks haven’t always done well — FriendFinder Networks, owner of Penthouse brand and various adult sites, went bankrupt in 2013, two years after its IPO. And Playboy Enterprises went private in 2011 after years of declining sales and stock prices. Then again, unlike those companies, Avid Life is growing quickly, according to company claims.)
Different mores aside, the company says it is ready to go public given its enormous growth. Bloomberg reported that the company had sales of $115 million last year, that’s four times more than 2009. Avid Life says it has 36 million members in dozens of countries, and is making a big push in Asia.
“We built the dirtier side of dating sites,” Avid Life CEO Noel Biderman told Canada’s Business News Network in an interview on Wednesday. “This marketplace might be even bigger than the singles marketplace.”
As Avid Life looks to sell investors on the IPO, it points to a few key attributes Biderman says will make it an attractive stock: 100% of revenue comes from subscriptions, meaning it is no way exposed to the advertising market, or any potential advertiser skittishness. And it is gunning for Asia, hoping to generate 50-60% of sales from Asia by 2020, including Japan, Taiwan, and notably South Korea, where adultery was just recently decriminalized.
What’s more, Biderman claims societal opprobrium of adultery is waning and that “morality is changing.” And lest anyone think men are the main customers driving the business, the company claims that female membership on its main AshleyMadison.com site is increasing 10% per year faster than male membership. Moreover, within AshleyMadison’s sweet spot of users between ages 30 and 45, membership is evenly split between men and women.
“The ride isn’t over,” Biderman said of Avid Life’s ascent.