Ezra Shashoua, the company's chief financial officer, blamed the lower revenue on a drop in membership and increased advertising costs for affiliates, according to court documents.Shashoua also said credit card companies had refused to process transactions for the company's Internet businesses.Friend Finder Networks (formerly Various, Inc.) is an American internet company founded in 1996 by Andrew Conru.Its corporate headquarters are located in Boca Raton, Florida, with additional offices in California, New York, and Taiwan.The contemplated public offering, scheduled to reach the market on January 27, 2010 was delayed by FFN.Friend Finder had not turned a net profit since at least 2008.Additionally, Adult Friend Finder ranked second in terms of adult dating site or app awareness in the United Kingdom, with 17 percent of surveyed individuals who reported that they knew it at least by name.
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The company had also indicated that it lacked existing cash or cash from operations to repay a .5 million debt that was due July 31.
It has cautioned that, unless it can repay or restructure its obligation, it will face “a material deficiency in our short term liquidity.” With these shortfalls in mind, the company again announced an intention to make an initial public offering of stock, representing a 49% stake in the company, with plans to use the proceeds to pay down its debt and become listed on the New York Stock Exchange.
Much of the company's growth without investment capital has been attributed to its affiliate program, with more than 500,000 affiliates to date.
As of January 17, 2010, Friend Finder Networks had a negative net worth equal to 8 million, million in cash on hand and 0 million in liabilities.