OnlyFans Explores SPAC Merger, Could Be Going Public: What You Need To Know

Social media platform OnlyFans could become the latest company to go public to continue its impressive growth. One element of the company’s business could be keeping investors from getting excited about the company and prevent a SPAC merger.

What Happened: OnlyFans has held talks with “multiple” SPACs about a potential merger to take the company public, according to an Axios report.

The company has millions of monthly users and has paid out billions of dollars to creators.

While it lets all creators on the platforms, content that is considered adult has been something investors haven’t been able to get past.

In August 2021, OnlyFans announced a decision to ban graphic content on the platform. The decision was later overturned, as it sparked a huge conflict with its creators.

OnlyFans tried to raise funding last year with little success, according to the report.

Axios named Forest Road Acquisition Corp II FRXB as one of the SPACs that was contacted by OnlyFans. The SPAC is led by several former The Walt Disney Co DIS executives and also counts Shaquille O’Neal as an advisor.

The report said this SPAC and others couldn’t get past the pornographic content on OnlyFans. 

Without SPACs interested, OnlyFans could still consider going public via a traditional IPO or direct listing.

Along with facing trouble getting investors, OnlyFans has also faced trouble getting banking companies and financial firms to help with payouts to content creators due to its graphic content.

“These changes are to comply with the requests of our banking partners and payout providers,” the company said when it announced the adult content ban last year.

Related Link: How Important Is Porn To OnlyFans? 

Why It’s Important: OnlyFans' plan to ban explicit content was met with backlash. The company is continuing to shift away from and try to rely less on being a “porn platform.”

Social media platforms have grown in number and are in a constant battle to attract users and content creators.

The report said OnlyFans wants to be a place for fans to connect with creators, mentioning a combination of TikTok and Patreon as reference.

OnlyFans estimated 2021 revenue at $1.2 billion and 2022 revenue at $2.5 billion, according to a pitch deck seen by Axios. The company had revenue of $375 million in 2020. The pitch deck from March 2021 also showed the company had paid out $3.2 billion to creators, with over 16,000 earning at least $50,000 annually.

The growth of content creators and users that don’t rely on OnlyFans for explicit content could make the company more likely to secure funding and attract a diverse base of investors.

PLBY Group Inc PLBY, which owns the Playboy brand, went public via SPAC in 2021. The company has distanced itself from its former magazine and video content that was explicit and turned into a company growing with sexual wellness brands, licensing and NFTs.

OnlyFans launched OFTV last year, a free streaming service without explicit content.

The company finds itself in a delicate place with the need for funding to grow and banks to help process payouts, but with a reliance on explicit content until new growth drivers are realized.