Rival Creator Startups Passes and Fanfix Discussed Deal
**Title: Rival Creator Startups Passes and Fanfix Discussed Deal**
By Kaya Yurieff
11 hours ago
Source: The Information
Passes and Fanfix, which operate competing apps that connect creators to paying fans, discussed a merger in recent months but abandoned the talks, according to both companies. The talks, which haven't previously been reported, came to light as part of an increasingly acrimonious dispute between the two rivals.
Passes on Thursday sent a cease-and-desist letter to Fanfix demanding that the startup stop making alleged defamatory statements about Passes. It claimed some of Fanfix's employees are engaging in a "smear campaign" including by telling Passes' creators, business partners, and investors that Passes is "dangerous" and "going out of business."
The letter, which was viewed by The Information, also alleged that Fanfix's parent company SuperOrdinary, run by CEO Julian Reis, attempted to sell its interests in Fanfix to Passes "to cut his losses." A Fanfix spokesperson said the two companies discussed a potential merger, but didn't agree on the terms. The conversations didn't progress after Passes wanted 85% of the merged company, the Fanfix spokesperson said. Passes founder Lucy Guo had told Reis Fanfix was "doing significantly better" in terms of customer sales and revenue, though she said Passes had a better product and "over a decade of runway," according to a text message.
Passes, which raised $40 million in Series A funding from venture capitalists, last week accused Fanfix of using a recent lawsuit to "damage Passes' reputation." The lawsuit, brought by an OnlyFans creator, alleged that Passes recruited her to create pornography before she turned 18 and distributed that content to paying subscribers. Passes and Guo have denied the allegations. A Fanfix spokesperson said the company doesn't have anything to do with the alleged pornography charges, and that the letter is short on proof.