Investors are preventing the porn industry from becoming safer
Here's why
I started Freyja when I was still in University. I had never really thought of myself as the entrepreneur type, and frankly the idea of starting a company had never really crossed my mind. From 13-18 I was heavily into competitive rowing. It’s where I spent most of my time before and after school, and where I felt happiest. However, in 2018, I ran a campaign to reduce sexual harassment and assault in the sport, and quickly found myself alienated from the thing I loved most. Since then, I became incredibly passionate about fighting sexual assault and harassment, and felt a strong sense of responsibility to do something about this.
So, I got into political consultancy, and worked within the U.S. Democrat party. I thought that politics would be the way to make a change that I wanted to see. But, shocker, it doesn't. Or at least, wasn’t going to make the change as fast as I wanted it. That is when I came up with the idea for Freyja. It went off like a light bulb, and I felt like I had finally found an answer to the problem I desperately wanted to solve. I saw such a strong connection between a lack of sex ed, learning from porn and copying it. There are many sites out there that are ‘for women’ or just focused on sex ed, but there really weren’t any out there offering safe alternatives to fan or tube sites which are the most popular sites for consumption. Therefore, if there was a safer site for mainstream consumption this could in turn help improve performer treatment, consent and everyone’s sex lives.
Because I was so passionate about wanting to solve an important issue, it naively hadn’t yet occurred to me that investors and banks were going to be the ones to stop me.
I didn’t know the first thing about starting a company, and knew I would need to raise funds but I didn’t know more than that. I was lucky enough to find a couple of Angel investors (An angel investor is an individual who provides capital for a business or businesses, including startups, usually in exchange for convertible debt or ownership equity) who were passionate about the project, but it took over a year to complete this round, and at times felt as though it would be impossible. In our second round of investment, this was when I started to feel much heavier the ‘taboo’ of our industry.
I’ve spoken with a lot of investors who immediately believed in what we were doing, and thought that this was necessary and that the timing was right. But despite this, instantly said no, or would ghost/block me. Why?
The industry was simply too taboo for them
Even though they would be an angel investor, their work contracts (usually in banking or private equity) stated that they could not even privately invest in porn. Yup, that’s a thing.
VC firms are usually forbidden to invest in sin industries by their LPs. There may be one or two femtech funds or sextech funds but they typically invest more in period products, or sex toys and won’t touch porn.
Startup investment is already challenging enough, but when you add in these challenges your possible investment pool becomes even smaller. Suddenly it became a lot clearer to me why the porn industry wasn’t moving forward, because if new companies came in to try to make it better, investment was preventing them. And, I’ve seen this with a number of companies who are trying to break into the space, but they can’t achieve those big ticket VC funds that will enable you to become competitive, rather they have to settle (if they even can) for small investment tickets. When you really think hard about it, it doesn’t make sense why there is this investment restriction, because that restriction is what is actively preventing the much needed change. And this all comes to nothing more than the concept of taboo.
At first this just felt like an obstacle, but as time went on you really started to become slightly resentful towards this. I would see all these other startups getting funding who had less traction than us, or less impact, and the only reason we weren’t getting funded was ‘taboo’.
I would reach out to impact funds, because Freyja fights sexual harassment, revenge porn, child abuse and more. So, we really do stand for impact. However, I quickly discovered that VCs were not interested at all in social impact. As someone that was super passionate about trying to solve this problem and seeing how desperately the issues in porn needed to be fixed, it could feel incredibly discouraging at times to feel funding hopeless.
Everyone says, it only takes one. So, you keep going. But, it’s about time that these investment and ESG policies enter 2023, and look at how they might be not supporting but hindering impact because as it stands no aspiring adult company is going to be able to make a change, if the key is hidden.