When Sex Doesn't Sell: FriendFinder Networks Files for Bankruptcy

Sometimes the sex business is rough and leaves an investor really sore–or wiped out, as in the Chapter 11 case of FriendFinder Networks, which owns Penthouse magazine and a string of adult entertainment websites. The company is best known for AdultFriendFinder.com, which enables people to arrange meetings for sex. The more than 40 sites in the brand network include BigChurch.com, a site for Christian singles; Amigos.com, a site for Latinos; and LesbianPersonals.com.

The company blames its debt–more than $544 million, most of it assumed from its $400 million purchase of Various, a network of dating sites, in 2007—for the financial woes. After buying Various, it merged its online properties with its Penthouse Media Group holdings to form FriendFinder Networks which, all told, had about 750,000 subscribers at the end of 2012.