Adult Toy Industry now a Multi-billion Dollar Business!

Aug 31, 2015

Adult toys have become big business. Recent studies show that the industry is worth US$15 billion and that the figure could reach US$52 billion by 2020. But, what exactly has changed?

Well, the adult toy industry has been the one of the fastest growing industries in the past decade. Key growth drivers in the sector include widespread changes in cultural values and anonymity of the internet. When the toys could only be found in retail stores, not many people would dare to bother for fear of being seen. No one wants to be seen buying a sex toy at a retail shop. However, the internet has made the whole process much easier. No one has to see you making the purchase. All you need to do is use your smartphone to make the order and the product will be delivered to your doorstep wrapped in a package that leaves no clue at all.

Last year, Cave Inc., a San Francisco based startup that specializes in up-market toys raised more than $2.4 million from about 60 investors. According to Cave Inc. CEO Michael Topolovac, investors don’t care about the industry as long as they are guaranteed profits on their investment. They want results, and currently sex is one of the hottest markets. He says that the adult industry is proving to be a massive opportunity what investors can’t pass on.

Cave Inc. currently works with a group of innovative technologists to help manufacture better, more satisfying products. The company’s co-founder Ti Chang first met Topolovac in China where she was promoting her startup. The two merged their ideas to combine erotica with jewelry and the result was Cave Inc.

Another adult toy company, AHALife, owned by former Goldman Sachs analyst Shauna Mei managed to raise more than $21 million in 2010 to start the company. Minna Life, a San Francisco adult toy startup owned by Brian Krieger also rose close to $83.777 million around the same time.  It shows just how much investors are willing to throw their money towards adult toys.

It is, however, important to note that banks and other traditional payment processors are still not very open to adult toy businesses. For instance, a bank may decline that you open an account with them completely just because you deal in adult toys. Fortunately, companies such as EMB are now providing all type of adult toy merchant accounts at very competitive prices.

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Having a merchant account allows an account holder to take advantage of merchant cash advances. When a merchant is approved for an advance, the business agrees to receive a lump sum of cash in exchange for an agreed-upon percentage of future credit card sales.

Pricing varies depending the merchant’s industry, past credit card processing history, the type of business seeking the account, average ticket sales, and average transaction volumes.

Yes, EMB works with merchants who are building their credit, as well as those who have poor credit. EMB also approves merchants that have no credit card processing history and businesses that have lost their merchant accounts due to high chargebacks.

Several factors influence a merchant’s risk level. Though only one factor likely will not get a merchant classified as high risk, a combination of these may: business size, location, and industry, credit score, credit card processing history, a industry’s reputation for excessive chargebacks, a prior history of high chargeback ratios, and whether a merchant exclusively sells online.

Virtual terminals are stationed on a merchant’s website, making it easy for customers to make a payment or purchase online. Merchants or a payment processor can easily set up virtual terminals, so online businesses can accept credit and debit card and e-check transactions.

A merchant account is a business account with an acquiring bank. Without this business account, which actually works more like a line of credit, a merchant cannot accept and process credit and debit card transactions. Businesses need a merchant account to accept major credit cards via a static point-of-sale terminal, mobile card reader, or through a virtual payment gateway.

After filling out EMB’s simple online application and submitting any necessary, requested documents, many merchants get approved within 24 and 48 hours.

EMB specializes in working with high-risk merchants. EMB works with many merchants, including but not limited to businesses in these industries: gambling and gaming, adult entertainment, nutraceuticals, vaping and e-cigarettes, electronics, tech support, travel, high-end furniture, weight loss programs, calling cards, e-books and software, and telecommunications.

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