40 Million is HOT

by Jeremy Schoemaker on February 12, 2008 · 52 comments

Hot Or Not Hot Or Not has been purchased by Avid Life Media for a reported 20 million dollars. Big congratulations to founders Jim Young and James Hong. I originally met James at a TechCrunch party last fall. Very cool & down to earth guy. He was telling me about the explosive growth that hot or not was experiencing due to Facebook and other super high trafficked social media sites.

Hot or Not has a great story. Basically 2 buddies built a site for fun where people could rate people based on their looks. They always had a moderation queue so they could weed out the pornography. The funny thing behind this is James’s parents were doing most of the moderation for the first couple years of the site. He told me it was kind of weird paying his parents to sort out the porn pictures on Hot or Not. Anyway they implemented a dating/connection component and other items to create revenue over the years. Techcrunch reported last may the site was bring in 5 million a year in revenue with 2-3 million of that being profit on average. Also reported was that the founders had taken out 20 million from the site over the years.

So this means they have personally taken in 40 million from the site now with the sale. Great job guys.

full disclosure

About the author...

– who has written 2895 posts on ShoeMoney.com.

Jeremy "ShoeMoney" Schoemaker is the founder & CEO of the ShoeMoney Blog, Elite Retreat Internet Conference, & the PAR Program. In 2013 Jeremy released his #1 Amazon Best selling Autobiography titled "Nothing's Changed But My Change" - The ShoeMoney Story. Jeremy currently lives in Lincoln Nebraska with his wife and 2 daughters.


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{ 48 comments }

1 Nick

Wow, good for them is all I have to say :)

2 Aleks

i know this site for years, nice job!

congrats to the founders!

3 Funny t shirts

It’s funny how so many comments at TechCrunch are claiming $20m is too low… I’d say that was a decent offer if true.

4 Sheepeffect.com

I’m wondering how they were making millions of profit each year?

5 Jeremy Schoemaker

its pretty spelled out in the TC post. They offer a dating component and other virtual services. They were getting about 10,000 signups a day on average in 2007

6 Make Money Online

it’s great to see that if you stick at something long enough, the web will pay out a small fortune!

7 CatherineL

That is amazing. It doesn’t seem long since they launched and I remember thinking it seemed like a smart idea. It has certainly paid off for them.

8 FREE PPC Affiliate Tracking 2.0

Personally I felt that if they were bringing in 5 million per year and of that, half were profits, 20 million was a little on the low side. They probably could have generated more by keeping the site unless they have something else in mind to invest the 20 million in.

9 Erica DeWolf

Easy, simple concept…yet extremely successful!

It just goes to show you…put your simple ideas into action. They don’t have to be complicated to be popular and make money!

10 Sabrina

Wow, sounds like a hot site, lol. What an awesome thing to have bragging rights on. We’re definitely in a new generation, our kids and grandkids are going to be web fortune heirs!

11 Dan Rucci

I was actually reading about Jim and James yesterday in a book …. great concept and great result for these guys!

12 Start Blogging

Congrats to them! It’s amazing what a little, simple idea can turn into.

13 Syed Balkhi

40 million is surely hot. I am surprised to see that they credit facebook and social network sites that much. It was just a unique idea and innovation is good money ;)

14 Affiliate Confession

That’s insane! 5 million a year in revenue and then they get paid $20 million for the site, I know there are still a million ideas like that left, I just have to find one. That just frickin’ insane!

15 Blog Advertising Network

I think what you said in your past video applies. Do something that you love to do. This is what Hor or Not owners did

16 SEOContest2008

wow $20 million from a site is just great. James’s parents must be really happy now :)

17 darin carter

this is a great story … I remember using hot or not in the past … My buddy met his wife on there!

18 Tom Beaton

Thats a pretty cool success story. Everyone has heard of it!

19 RacerX

That’s about $20 Million more then the Paris Hilton movie with a similar title made!

20 Blog Advertising Network

LOL! I am sure they are happy and think that it worth watching so much porn :)

21 naijagal

congratulations they have made it!

22 Will

wow.. how do you even go about asking your parents to weed out porn on your site? lol

23 Will

another true success story. I didn’t think hot or not was this popular.

24 PPC Management

Wow. That’s impressive.

25 Hustle Strategy

It was like pringles, once you started, you couldn’t stop… you had to go through withdrawl symptoms and all.

26 Hood Workout

It was always a good distraction, before all these social gathering sites. still a great site though.

27 Hood Workout

i would go with it being low. depends on whether they can do something more with it. but the pe ratio seems great for an internet company.

28 Geiger

Now I will do the same with http://www.FavoritePart.com

29 Paul

Incredible! I hope that I can get someone like you Shoe to write a post just like that about me. Do you know if they had an investor?

30 RacerX

If they are pulling in $2M a year it is 10x earnings which isn’t cheap. Unless they have some decent IP its a gamble.

31 Jen, writer MembershipMillionaire.com

It’s amazing what these two buddies did. And to think it all started from something they thought was a fun and cool idea. It makes me wonder what next new idea is going to appear next and who will be responsible for it? It takes just a bit of creativity and a dash or innovative thinking to create something new and exciting. That bit about paying the parents was pretty amusing, too!

32 Discount Web Design

So, the parents lost their job? :D

33 Flash Gamer

Thats funny that his parents had to weed through the porn. This is my dream, develop a site, it gets hot and sell it off for millions. Awesome job they did in my opinion.

34 Affiliate Confession

It’s crazy because I’ve spent like 5 minutes on the site in the last 2 years. I had no idea it was this popular either.

35 Ty Brown

You’ve got to love the internet

36 Make Money - Cashtacular

It’s nice to see a very simple idea with strong execution get rewarded. There are a ton of small ideas that could make loads of dough, as long as their implemented properly. Ideas are obviously important. Execution is much more significant.

37 RacerX

…and a Roomie. They were going to get him Rims for his bed at Christmas too…

Kidding

38 Puneet

Wow thats a good amount ;)

thinkin for a good idea for which theme should be started

39 Nicholas James

I blogged about it on my blog when a source rang me as the deal was going through, was a great business deal for them :)

40 Nicholas James

I’d say its marginally on the low side considering the revenue it was pulling in and I’m sure they can increase profitability on their site too

41 Money Never Sleeps

I remember when Hot or Not started…it was huge in the office! The people who invented that site were like pioneers for the Social Networking sites and the boom that we are in…I think they sold for too low! Hopefully they still have some sort of profit sharing agreement or something!

42 Money Never Sleeps

Execution of your idea is the NUMBER 1 thing…it is so important not to just sit around himming and hawing…just do it!

43 Chris

Wow. I’m impressed by that. I was trying to figure out what kind of revenue that site brought in. Not bad–now they’re rich.

44 Chris

I agree completely–20 mil for that site seems like a very nice payday.

45 oakling

I remember being shown that site when I worked at Ask Jeeves in 2000… it’s been around FOREVER!

46 Bonus Ringtones

i actually thought the site had more potential and could be worth up in the low xxx millions. Surprised it sold for so less, although the popularity has kinda died down since the site is a couple years old if they sold it in its prime i guarantee they could of got a lot more, and 40 million isn’t really a whole lot of money nowadays, im guessing it coudl buy 20-30 years of good living

47 Paid Surveys Reviewed

They did well to get that for it as there are so many competitors out there, just shows you that there is great money to be had with sex sites

48 HardGeek

40 million is too hot.

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