The Porn Producer on Your Block

Porn companies have always been interested in the girl next door, but now there’s a company that’s taking an interest in her parents.

Pleasure Dynasty is trying something new in the industry: opening the filmmaking process up to outside investors and letting them add the title of adult film producer to their resume (though don't expect too many people to brag about it).

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Most adult entertainment companies are firmly closed to "civilians," the industry’s term for outsiders. But Carlos Cavero, owner of Pleasure Dynasty, says his clients range from club owners to risk managers on Wall Street.

"People want to be in the circle," he says. "They want to feel they’re doing something that's a viable business where they’re going to make money — and they want to work with pros. They're businessmen at the end of the day, but they want to have fun."

Those clients, not surprisingly, tend to prefer anonymity. While it might be a money-making opportunity, porn still carries a stigma in many circles, and people don't want to risk their reputation. But investors who have fronted money say they believe the industry is safer than many other investment vehicles.

"I think it's like the bar business — it’s recession-resistant, and I'm what you call cautiously optimistic," says 'Jesse Jama' (not his real name), who says he has invested $100,000 in Pleasure Dynasty. "I don’t think there’s any way this could be a disaster for me. And it does have the potential to make a nice tidy little profit."

Jama has financed three films so far — and says that while he hasn't realized any returns yet, the early numbers are encouraging.

A big budget porn film, like the parodies of "Taxi Driver" and "Zorro" that Pleasure Dynasty has distributed, live several lives. For the first 60 days, the focus is on DVD and broadcast sales, which include everything from providers of porn to the nation's hotels, such as New Frontier Media, to cable channels that air adult films.

"Having soft versions of movies is key to having a successful broadcast run," says Cavero. "The broadcast channel distribution done right should cover 100 percent of your investment after all markets are hit and through the year — or at least 50 percent of the investment — so this is a key channel."

After that, internet protocol television options are explored, in which films are distributed through various set-top boxes on the market like FyreTV(which focuses on adult content). Pleasure Dynasty is also in the process of creating an app for the Boxee set-top box. From there, video on-demand sites, like Hotmovies and AEBN are looped in, both of which sell movies by the minute or scene to viewers.

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In the months to come, the company plans to add another distribution arm that will follow video on demand distribution: a paid membership website that cuts out the revenues that must be shared with other distribution partners.

Jama's cash outlay in Pleasure Dynasty is higher than most. An entry-level investor can jump into the industry for as little as $20,000, though most opt for the $60,000 level, which lets them participate in a larger production and has a greater chance of being a breakout hit.

Cavero acts as a facilitator, lining up investors with directors and distributors who have dozens of years of experience in the industry. He doesn't hold the investor's money up front, he says, and his money comes from the backend, as he takes a 34 percent cut of any profits made.

The investors, to date, have been individuals, but there's really nothing stopping a group of friends from investing together, opening the door for crowd-sourced porn. Cavero is not actively courting that demographic, however, since getting a group to arrive at a decision can be arduous — and, he suspects, many wives wouldn't want husbands banking on the porn industry for a portion of their retirement funds.

In many ways, the company is built for the person who has always wanted to break into the adult entertainment industry but doesn’t know how — and doesn't have the bankroll to regularly produce content.

"The adult industry is very organized," he says. "Distributors are not going to talk to you if you have just one movie."