Leave it to a steamy company to try to heat up an ice-cold IPO market. FriendFinder Networks is filing to go public this week, looking to raise as much as $460 million by proving that sex sells, even in recessionary times.

FriendFinder runs several innocuous dating sites, such as Senior FriendFinder for seasoned daters and BigChuch.com for single people with devout religious beliefs, but let's not kid ourselves. FriendFinder is all about AdultFriendFinder.com, which bills itself as "the world's largest adult social network & sex personals."

With more than 25 million members, the "real people, real sex" IPO will answer life's most pressing question: Can booty calls kick butt in your portfolio?

There are already plenty of publicly traded companies with online-dating ties, including Yahoo! (NASDAQ:YHOO) Personals, The Knot's (NASDAQ:KNOT) GreatBoyfriends.com, and IAC (NASDAQ:IACI) with Match.com and Chemistry.com. I guess you can call FriendFinder an adult mating site.

Is it taboo? Well, there are plenty of publicly traded adult-entertainment companies out there already. Everyone knows softcore giant Playboy (NYSE:PLA), but there's also strip-club operator Rick's Cabaret (NASDAQ:RICK) and adult-video maker New Frontier Media (NASDAQ:NOOF). Folks trade in these companies all of the time, and the share certificates aren't delivered in brown paper bags.

For many investors, the real question will be whether this is a business worth investing in. FriendFinder derives revenue in different ways, but the biggest driver is subscription revenue. Nearly a million members pay an average of $19.06 a month for access to premium content and site features. Monthly churn is a ridiculously high 18%, but you probably expected as much. Subscriptions account for the majority of the $243.9 million FriendFinder made in the first nine months of the year. A good chunk of what's left comes from usage fees, as the company collects nearly $3 per minute for access to premium webcam content.

Does this add up to a good business? It's debatable. The company has posted operating losses and net losses in each of the past three years. It is showing an operating profit through the first three quarters of 2008, so perhaps the income statement is starting to get lucky.

The company is sporting more than $400 million in debt, and its independent accounting firm is tagging most of that burden as current, as the result of "events of default." Ouch. This would explain the rush to take the company public and the amount of money being raised in the offering.     

The warning flags are certainly there, yet it is also a climate that is likely to deliver an attractive price to the IPO for investors.

Sex does sell. Now we just need to know who's buying.

Some interesting ways to profit from the IPO void:

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