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.
About the author...
Jeremy Schoemaker – who has written 2415 posts on ShoeMoney.com.
Hi I am Jeremy Schoemaker and ShoeMoney.com is my blog. 99% of the post here are done by me but you will see others occasionally make guest posts. This blog is fun to write but for my day job I run several online companies.
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{ 48 comments… read them below or add one }
Wow, good for them is all I have to say
i know this site for years, nice job!
congrats to the founders!
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.
I’m wondering how they were making millions of profit each year?
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
it’s great to see that if you stick at something long enough, the web will pay out a small fortune!
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.
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.
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!
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!
I was actually reading about Jim and James yesterday in a book …. great concept and great result for these guys!
Congrats to them! It’s amazing what a little, simple idea can turn into.
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
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!
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
wow $20 million from a site is just great. James’s parents must be really happy now
this is a great story … I remember using hot or not in the past … My buddy met his wife on there!
Thats a pretty cool success story. Everyone has heard of it!
That’s about $20 Million more then the Paris Hilton movie with a similar title made!
LOL! I am sure they are happy and think that it worth watching so much porn
congratulations they have made it!
wow.. how do you even go about asking your parents to weed out porn on your site? lol
another true success story. I didn’t think hot or not was this popular.
Wow. That’s impressive.
It was like pringles, once you started, you couldn’t stop… you had to go through withdrawl symptoms and all.
It was always a good distraction, before all these social gathering sites. still a great site though.
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.
Now I will do the same with http://www.FavoritePart.com
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?
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.
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!
So, the parents lost their job?
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.
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.
You’ve got to love the internet
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.
…and a Roomie. They were going to get him Rims for his bed at Christmas too…
Kidding
Wow thats a good amount
thinkin for a good idea for which theme should be started
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
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
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!
Execution of your idea is the NUMBER 1 thing…it is so important not to just sit around himming and hawing…just do it!
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.
I agree completely–20 mil for that site seems like a very nice payday.
I remember being shown that site when I worked at Ask Jeeves in 2000… it’s been around FOREVER!
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
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
40 million is too hot.