Onlyfans IPO: Is it going public following explicit content ban?

Highlights

• OnlyFans recently announced an upcoming ban on all sexually explicit content.
• This move has paved the way for speculations that OnlyFans is “cleaning up” its platform in preparation for an initial public offering (IPO) in the near future.
• OnlyFans has also been reported to be looking for funding for a valuation of US$ 1 billion.

OnlyFans, a content subscription service, is witnessing an explosion of curiosity around its plans to go public.

The platform, known to draw users who pay money to receive content from celebrities and adult-film stars, recently announced an upcoming ban on all sexually explicit content.

This move, which is set to be implemented in October 2021, has paved the way for speculations that OnlyFans is “cleaning up” its platform in preparation for an initial public offering (IPO) in the near future.

What is OnlyFans and what does it focus on?

OnlyFans, which works similarly to the way membership platform Patreon does, offers creators a platform to broadcast their content in exchange of 20 per cent for their earnings.

Launched in September 2016 and primarily known for adult entertainment, OnlyFans focuses on other gated contents as well. Its list of artists has included big names such as boxer Floyd Mayweather, singer-cum-rapper Cardi B, Hollywood actor Bella Thorne (who reportedly raked in more than US$ 1 million on her first day on the platform).

Rumors about an IPO were also fueled after OnlyFans launched streaming platform ‘OFTV’ on Wednesday, August 17. It is said to be free of any sexually explicit content, as it is a requirement for iOS and Google Play apps, and focus on genres such as fitness, culinary, humor, etc.

Also read: 5 upcoming IPOs of Canadian startups to watch closely in 2021

Is OnlyFans going public via IPO?

Speculations have been rife about OnlyFans seeking major investments. But despite its significant user base and sales figures, it is said to have been facing hurdles in garnering sufficient investor attention.

This could have triggered the recent ban on adult content to draw in more venture capitalists.

Some reports also point that OnlyFans was under pressure from financial partners to make such changes to its platform.

The membership-based service provider is said to be looking for enough funding that will pull up the company’s valuation to about US$ 1 billion.

The United Kingdom-based company reportedly raked in sales worth over US$ 2 billion 2020, benefiting largely amid the pandemic-driven lockdowns that saw many online enterprises flourish.

OnlyFans is said to have recorded a topline growth of some 553 per cent year-over-year (YoY) to US$ 390 million in the 12 months ending November 2020, while its profits amounted to about US$ 74 million.

For the same period, its daily active user base reportedly rose to about 120 million.

While the rumors are on fire, OnlyFans has not made any announcements pertaining to its IPO plans. But if it happens, it could be a significant public debit to watch out for.

Also read: Nubank eyes $2B IPO: How to buy the fintech giant’s stock?

Bottomline

Unlike most social media platforms, OnlyFans does not feature advertisements on its site, which some believe is due to its adult entertainment content. But now that the company is set to leave that part of it behind, there is a possibility that it would be seeking ads as well.

In that case, OnlyFans’ revenues could add on its 20 per cent commission model and go further up in the future.

As of now, interested investors may have to wait a while to hear about OnlyFans’ IPO plans.