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Dear OnlyFans: What the heck are you doing? Sincerely, the internet.

August 20, 2021, 3:09 PM UTC

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Usually, when a social media platform tightens its grip on sexually explicit material, netizens generally nod along. 

That wasn’t the case for OnlyFans, the social media company that allows creators to sell their content on subscription. Its Thursday decision to ban sexually explicit content beginning in October ignited panic among its user base and elicited raised eyebrows from many on Twitter. Unlike say TikTok or Instagram that appealed to a broader audience, OnlyFans had found much popularity in a very specific though very lucrative part of the internet: In selling sex.

OnlyFans made hundreds of millions last year in part due to sex workers who flocked to the platform during the depths of the pandemic. Now, as it turns against sexually explicit content, creators on the platform that helped make it so successful feel as if they’ve been used and thrown aside. And it raised another question too: Will the platform survive without sex?

One important note of clarification: OnlyFans is still allowing nudity on its site as long as it is consistent with the company’s policies. Which means users are still waiting for the company to define the line between nudity and sexually explicit content.

Still, this broad turn against pornography by a social media company immediately drew comparisons to another company that made a similar pivot several years ago and fizzled out as a result: Tumblr. Once valued at as high as $4.5 billion, Tumblr banned adult content in 2018. But unfortunately, users were coming to Tumblr for its titillating posts, and it lost a third of its users a year later

Meaning from a historical point of view, OnlyFans’ decision is a fraught one—one that has led to an exodus of users in the past. 

So why fix something if it isn’t broken? In its Thursday statement announcing the ban, OnlyFans said the “changes are to comply with the requests of our banking partners and payout providers” without naming said providers and partners. 

And this is where it gets kind of weird. Sure, banks and payments companies have historically been wary of the porn industry, with Mastercard in April demanding verification of age and consent from adult content sellers.

But Mastercard on Thursday said it had not been in conversations with OnlyFans preceding the ban. “We found out about this through the media coverage. This appears to be a decision they came to themselves,” Seth Eisen, senior vice president of communications at Mastercard, wrote in an email to Term Sheet. Visa and Discover meanwhile have yet to respond to requests for comment.

Axios on Thursday provided another potential explanation that may have driven the ban: The company might be rolling in dough, but it has struggled to find investors willing to take a cut in the company in part due to its explicit content. Some venture capitalists are in fact unable to invest in such businesses due to so-called vice clauses that bar funds from putting dollars in industries around say sex and tobacco.

Then the BBC also published a report on the same day alleging that the company has lax moderation policies that have allowed illegal content, including those featuring minors, to appear.

All of this puts OnlyFans in a really messy position: It’s trying to go mainstream, and even kicked off promotions for a safe-for-work app this week. The ban could certainly address the issue of illegal pornography on its site—but users also say it could be kicking legal sex workers to the curb and raises the question as to whether OnlyFans is sending off its own biggest fans.

Lucinda Shen
Twitter: 
@shenlucinda
Email: 
lucinda.shen@fortune.com

Jessica Mathews compiled the IPO and SPAC sections of this newsletter.

VENTURE DEALS

- DriveWealth Holdings, a Chatham, N.J.-based fractional trading company, raised $450 million in Series D funding valuing it at $2.9 billion. Insight Partners and Accel led the round and were joined by investors including Greyhound Capital, Softbank Vision Fund, and Point72 Ventures.

- Ample, a San Francisco-based electric-vehicle battery swap company, raised $160 million in Series C funding. Moore Strategic Ventures led the round and was joined by investors including Shell Ventures, PTT, Disruptive Innovation Fund, Eneos, and Clayton Christensen's Rose Park Advisors.

- Reali, a San Mateo, Calif.-based real estate buying startup, raised $75 million. Zeev Ventures led the round. 

- Nacelle, a Los Angeles-based e-commerce tech company, raised $50 million in Series B funding. Tiger Global led the round.

- jaris, a Burlingame Calif.-based provider of a lending solution, raised $31 million in Series B funding. GSR Ventures led the round and was joined by investors including  Wing Venture Capital and Franklin Templeton.

- Metabase, a San Francisco-based maker of a platform for sharing data and analytics, raised $30 million in Series B funding. Insight Partners led the round and was joined by investors including Expa and NEA.

- Osaro, a San Francisco, Calif.-based robotic automation for logistics company, raised $30 million in Series C funding. Octave Ventures led the round and was joined by investors including J17 Capital, and Tomales Bay Capital.

- WeSpire, a Boston-based provider of employee engagement software, raised $13 million in Series B funding. Level Structured Capital led the round.

- Hyperithm, a Japan- and South Korea-based digital asset management company, raised $11 million in Series B funding. Hashed and Wemade Tree led the round and were joined by investors including Coinbase Ventures, Cocone, GS Futures, and Guardian Fund.

- Regology, a San Francisco-based company focused on enterprise compliance, raised $8 million in Series A funding. ACME Capital led the round.

- Diamond Age, a San Francisco Bay Area-based home construction startup, raised $8 million. Prime Movers Lab and Alpaca VC led the round and were joined by investors including Dolby Family Ventures, Calm Ventures, Gaingels, Towerview Ventures, GFA Venture Partners, and Suffolk Construction.

- bttn., a Seattle-based medical supply marketplace, raised $5 million. FUSE led the round.

- Yield Guild Games, a decentralized guild of players and investors focused on NFT-based games, raised $4.6 million. Andreessen Horowitz led the round and was joined by investors including Kingsway Capital, Infinity Ventures Crypto, Atelier Ventures, and Gabriel Leydon. 

- Earbuds, a maker of an app for sharing playlists, raised $3 million in Series A funding. Ecliptic Capital led the round and was joined by investors including Andre Agassi Foundation and LFG Ventures.

- Role, a video platform for role-playing games, raised $2.8 million in seed funding. Konvoy and London Venture Partners led the round.

PRIVATE EQUITY

- BlackRock and Knighthead Capital Management are investing as part of a $200 million round of funding in Breeze Airways, a low-cost air carrier.

- Achieve Partners invested in Cloud for Good, an Asheville, N.C.-based company for helping nonprofits and colleges implement Salesforce. Financial terms weren't disclosed.

- ATL Partners made a majority investment in GEOST, a Tuscon, Ariz.-based designer of electro-optical and infrared sensors for national security space missions. Financial terms weren't disclosed.

- Highmetric, a portfolio company of Gryphon Investors, acquired NewRocket, a Vista, Calif.-based maker of an employee portal based on ServiceNow. Financial terms weren't disclosed.

- H.I.G. Capital acquired Pegasus Home Fashions, an Elizabeth, N.J.-based pillow manufacturer. Financial terms weren't disclosed.

- PSG invested in Vault Verify, a New Smyrna, Fla.-based human resources platform. Financial terms weren't disclosed.

- Symplr, backed by Clearlake Capital Group and Charlesbank Capital Partners, acquired SpinFusion, a healthcare scheduling software maker. Financial terms weren't disclosed.

- WorldWide Electric, a portfolio company of Graycliff Partners, acquired Georator Corporation and its subsidiary, Athlon Generator, makers of frequency converters and generators. Financial terms weren't disclosed.

EXIT

- Vitruvian Partners will acquire a majority stake in Fotona, a Slovenia, and Dallas, Texas-based medical laser company, for about 700 million euros ($820 million) from AGIC Capital, per Bloomberg.

- Goldman Sachs and Charlesbank Capital Partners agreed to acquire MDVIP, a Boca Raton, Fla.-based healthcare company, from Leonard Green & Partners and Summit Partners. Financial terms weren't disclosed.

- Grain Management acquired Young’s Communications, a Melbourne, Fla.-based utility construction company, from Cotton Creek Capital. Financial terms weren't disclosed.

 

OTHER

- Goldman Sachs agreed to acquire Dutch insurer NN Group’s money-management operations for about $1.98 billion.

IPOS

- iCIMS Holding Corp., a Holmdel, New Jersey-based enterprise recruiting platform, filed for an initial public offering. The company posted revenue of $251.3 million in 2020, and reported a net loss of $48.2 million. Vista Equity Partners and Susquehanna Growth Equity back the firm.

- Argo Blockchain Plc., a London-based clean energy crypto mining company, filed for an IPO in the U.S. The company posted $26.2 million in total revenue in 2020 and a $5.4 million in gross profit. The Amplify Transformational Data Sharing ETF (BLOK) is invested in the firm.

SPAC

- Aspiration Partners, a Marina Del Rey, Calif.-based sustainable banking startup, plans to go public via a merger with InterPrivate III Financial Partners Inc., a SPAC led by Landmark Value Investments's Ahmed Fattouh. A deal would value the company at $2.3 billion. Aspiration is backed by basketball coach Doc Rivers, and actors Orlando Bloom, Leonardo DiCaprio, Cindy Crawford, Kaia Gerber, and Robert Downey Jr.

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