Adult Entertainment Capital, Inc.
has launched the first publicly traded and licensed investment option. Investors can put their money into all types of adult business—from gentlemen's clubs to lifestyle resorts, content and emerging technology platforms. This groundbreaking development changes the porn finance landscape.
Milton "Todd" Ault III, President and CEO of Adult Entertainment Capital, recognizes that the adult industry has suffered from a lack of strong financial investment opportunities, particularly in public capital markets. Adult Entertainment Capital, Inc. plans to meet that need by offering business development funds, financial management and full or partial buyout options to progressive adult oriented companies across all stages of the business cycle.
According to Ault, the process is pretty simple. "We can take a private company and fund them with publicly traded capital reserves, so they maintain their private status, and still have the ability to grow or diversify their business through our investment.” He continues that investors can go directly to their personal brokers to purchase shares in the adult companies through Adult Entertainment Capital's publicly traded stock. “For substantial private investment funds,” Ault says, “Adult Entertainment Capital. can act as a broker for investments and mergers, while giving the private parties the security of expert, regulated and licensed, financial and business management, that you just don't get when friends and family lend you venture capital.”
This latest development is part of a broader adult entertainment industry trend involving high finance, sophisticated structures and greater investor interest. Penthouse Media Group International
(PMGI) has expressed an interest in conducting an initial public offering (IPO), possibly this year. The company is seeking $250 million in equity capital. Also, adult industry hedge fund AdultVest
formed to provide investment capital to firms pursuing growth opportunities. The firm currently claims access to more than $11 billion in investable assets, with close to $3 million coming in the last day.
Like AdultVest, Adult Entertainment Capital is interested in all types of adult oriented industries. A growing market is arising for lifestyle services, including resorts tailored for swingers'. Gentlemen's clubs, adult novelty businesses and internet and mobile delivery of adult entertainment are also showing growth and diversification potential that will benefit from the type of financial services Adult Entertainment Capital, Inc. can deliver.
But, there is one crucial difference. AdultVest is privately held and only open to “qualified” investors—typically those with annual incomes of $300,000 or liquid net worths in excess of $1 million. Adult Entertainment Capital, on the other hand, is publicly traded, which makes it accessible to investors of all sizes. The firm trades over-the-counter (OTC) as ZLST.OB.
This is yet another profound development for an adult entertainment industry that has seen considerable change over the past two years. Mega-mergers, private equity funds and publicly traded investment vehicles are becoming the norm. And, investors are gaining newer ways to access these opportunities.