Adult Club Investments uses an investment approach that targets adult businesses that can grow and become sizable businesses or businesses acquired with a stated gross income that either can provide the anticipated return of investment. Real estate investments are also considered as an acquisition of the business site and included in the investment strategy. Selection of new adult business sites to be acquired and developed into an adult business is a difficult process due to strict government regulations and an important service available to our clients. The market opportunity for most investments will often be based on unique features of mismanagement or undeveloped profit centers, as evidenced by aggressive due diligence and group assessment. These types of companies are generally much more likely to develop competitive positioning, market share leadership, and greater profits. Finally, the management and entertainment venue of such companies must either be of top quality, or the Membership must be sufficiently satisfied that, with appropriate effort, a top quality management team and entertainers can be attracted to the situation. 


  • Target Industry Sectors
    We currently invest in Adult Cabarets, Adult Bookstores and real estate.
  • Investment Stage
    The majority of our investing is focused on the existing Adult Businesses, as well as site selection, acquisition and development.
  • Investment Size
    Initial investments typically range from $200,000 to $25,000,000 with the ability to provide additional funds for follow-on financings.
  • Investment Region
    We focus on U.S businesses. International investments are also available to investors qualified to understand and accept the inherent elevated risks.


The basic steps of Adult Club Investments’ investment process are:

  • Application and qualification
  • Investment Plan Review
  • Pre-Investment Analysis and Due Diligence
  • Investment Decision
  • Transaction Structuring
  • Extensive Value-Adding, Post-Investment Involvement
  • Investment Liquidity Strategy

A team effort is applied to the in-depth investment review process. Generally, one of the Adult Club Investments Members will take the lead on each investment opportunity. After determining that our basic investment criteria are met, a second member of the team is involved to assist with extensive analysis. Management of the prospective portfolio company may then be invited to present its business plan to all the Adult Club Investments Members. All information is then discussed regularly during "Members Meetings". As a result, all of the Members develop significant knowledge about the investment candidate, and the final investment decisions are based on full consensus. This helps lead to a true sense of ownership of decisions that is shared by the entire Membership and, in turn, encourages future participation and contribution for portfolio companies.

The General Member's active involvement with portfolio companies is a fundamental element of Adult Club Investments' approach to investing. Close interaction with company management, co-investors, and leading industry participants enables the Membership to add value to the Fund's investments by developing ways to help these companies execute their business plans more effectively. In some of the portfolio companies a Member will be represented on the Board of Directors. These value-adding activities go well beyond attendance at board meetings or communication solely with company’s owner. They include strengthening management, as well as active participation in basic operating, strategic, and financial decisions.
Lead and back-up members are assigned to each portfolio company in order to ensure appropriate coverage and involvement with portfolio investments. Typically, the lead Member will engage in policy issues for the duration of the Membership's investment in the portfolio company. However, other Members will often become involved in assisting the portfolio companies on various matters. The Managing Members' experience has proven that this type of teamwork can produce significant benefits.

In the management of investments in portfolio companies, Adult Club Investments intends to solicit, as needed, the extensive expertise and resources represented by the Affiliates Fund and the professional networks of the Members. Such resources might be called upon to provide consulting to portfolio companies.
In the final phase of the investing process, the Members will utilize their expertise when seeking liquidity events for investments in order to generate the maximum value for the companies involved.