Originally founded as an early internet-based media company by Tom Reilly in 1995,[1] it operated several LGBT-themed web sites, the first being an independent producer Forum on the Microsoft Network (MSN) and as an information provider on America Online.

[2] In April 1996, with Rielly as President and Jon Huggett as CEO, PlanetOut Inc. closed its first round of funding, a $3 million minority share investment by Sequoia Capital and America Online.

[3] By late 1996, culture challenges with management and strategy choices by the CEO were plaguing the company and Rielly was removed as president.

The company became profitable primarily from Gay.com's membership subscription revenue and online advertising business, resulting in a successful IPO in October 2004 with Lowell Selvin as CEO and Gay.com founder Mark Elderkin as president.

Although this was a 93 percent improvement on 2005 revenues, the purchase of RSVP Vacations was the beginning of the end for PlanetOut.