ARABIAN BUSINESS – Muzz, the world's largest Muslim dating app, has accused Match Group of aggressive intimidation tactics following a lengthy legal battle. Muzz recently lost its trademark in a UK appeal and was forced to change its name. Match Group is accused of using this power to intimidate other players, especially those with fewer resources for legal defense. Despite settling in the US and rebranding from muzmatch to Muzz, the UK appeal failed. Muzz has now urged the Federal Trade Commission to investigate Match Group's anti-competitive behavior. Match Group had reportedly attempted to acquire Muzz four times and subsequently filed a complaint when they didn't get the acquisition. Muzz views these actions as a calculated attempt by Match Group to maintain its dominance by litigating smaller competitors. The legal battle has been draining for Muzz, both personally and professionally, with costs approaching $2M.
Category: Match Group
Match Group to Release Q1 Results and Analysts Predict Strong Future Growth
BESTSTOCKS – Match Group is set to release its Q1 earnings data on May 2nd, with expected earnings of $0.40 per share for the quarter. Analysts have provided various ratings and price targets, with the average rating being "Moderate Buy" and an average price target of $70.38. The company's Q1 report could show progress toward growth targets and boost investor confidence in its position in the online dating market.
Malgosia Green Will Lead Match Group’s Asian Expansion
FAST COMPANY – Malgosia Green is three months away from uprooting her life in Vancouver and fully immersing herself in Singapore as CEO of Match Group Asia. She was appointed to the newly created role earlier this year by Match Group CEO Bernard Kim. Prior to taking over as CEO of Match Group Asia, Green led Plenty of Fish for five years. Malgosia Green will be focusing on expanding the company's presence in Asia, particularly in Japan, where there is significant potential for growth. ~50% of women and 70% of men in their 20s in Japan are single, according to a 2022 white paper from the Japanese Gender Equality Bureau. Green also aims to bring the Hinge app to new Asian markets in the coming quarters. It currently operates in India. Much of Green's mission is focused on Hyperconnect, the Seoul-based social media and video tech company Match acquired in 2021 for $1.73B. Part of that development will be in AI, Green says.
Institutional Investors Adjust Stakes in Match Group Amid Dating Industry Stock Turbulence
BEST STOCKS – AustralianSuper Pty Ltd, an institutional investor, recently reduced its stake in Match Group by 89.1% during Q4 2022, selling ~2M shares. Match Group has seen significant activity from institutional investors and hedge funds. True Signal created a new stake valued at $971K, Xponance saw an 11.2% growth in its holdings, and Ieq Capital increased its shares by 240.4% in Q3. Other new shareholders include Louisiana State Employees Retirement System and Calamos Advisors. As of April 16, 2023, 93.53% of Match Group's stock is owned by institutional investors and hedge funds.
Muzz Fights Third Lawsuit from Match Group and Calls for FTC Investigation
LINKEDIN – Match Group has sued Muzz (formerly muzmatch) for the third time over a patent related to digital matchmaking (Patent 666 – "Matching Process System and Method"), day after their appeal hearing in the UK. Muzz asserts that it declined Match Group's acquisition offers and has invested ~$1M in countering their legal actions. Muzz is calling on the Federal Trade Commission to investigate Match Group's dominant position and treatment of competitors.
Survey Shows 80% of Young Adults in Japan Did Not Date During the Pandemic
PRESS RELEASE – Eureka, a subsidiary of Match Group and the operator of Japan’s Pairs dating app, conducted a survey to study changes in young adults’ attitudes toward love this spring. The survey of 1,000 respondents found that 50% are eager to go on a date that would lead to a romantic relationship this spring. Additionally, 88.5% of respondents are using a dating app. Of those who were still single, 80% claimed that they did not go on a date during the pandemic.
Dating App Muzz Fights to Overturn Trademark Loss
LAW360 – Muzz (previously Muzzmatch), an online dating service aimed at Muslims, has recently found itself embroiled in a legal battle with Match Group. Match Group has accused Muzz of infringing on their trademarks by using the word "match" in their name, which they claim is causing confusion among users. However, Muzz has maintained that there is no evidence to suggest that users have actually confused the two brands. The case has now made its way to the London appeals court, where Muzz is urging the court to throw out the ruling made against them.
The Top Ten Things I Learned About Match, Tinder and Grindr at The Online Dating Investors Summit
OPW – The Online Dating (Investors) Summit was hosted by New Street Research (NSR) with assistance from Courtland Brooks. Institutional investors and Match Group / Tinder, Grindr presented. In addition Courtland Brooks had guests: 12 CEOs of leading dating companies. Mark Brooks interviewed the CEO of happn, Karima ben Abdelmalek in one session. Mark also interviewed a panel of notable CEOs, namely Joel Simkhai, Founder of Grindr and Motto, and Carsten Boltz, CEO of Online Personals Group, and Paul Rider, CEO of SALT.
Here are the top ten things I learned from the sessions with Match, Tinder and Grindr. CEOs
MATCH GROUP – Bernard (CEO) and Gary (CFO)
1. They are shooting for Hinge reaching $822m revenue in 2025, and $400m in 2023. Its around $300m now. Through global expansion and improved monetization.
2. They are rolling at HingeX at $50 a month. Hinge Plus, meanwhile, went down from $35 to $30/mo.
3. Malgosia Green (POF's former CEO) agreed to move to Asia and now heads Hyperconnect.
4. Bernard doesn't see a gap in management that requires a CEO for Tinder. He assumes both now, and will continue to do so.
TINDER
5. Claims more LGBTQ representation than any other general dating app. Has doubled in size.
6. The League inspired them to start experimenting with a $500+/mo pricepoint. Ran a smoke test and 30% are clicking through to check it out. 70% of those clicking through are under 30.
GRINDR
7. In summer 2022 they tried their first a la carte offering. 1 hour boosts were successful.
8. They will move away from ads. Currently 15% of revenue, but this will go down.
9. Ads are the thing users complain about most.
10. There is a massive tailwind for Grindr Internationally are more countries open up to them from a Government / legal perspective. i.e. more acceptance of LGBTQ
This event will happen again. Watch this space. Overall, it was a great initiative, with 18 leading CXOs in attendance, and ~40 institutional investors coming through to talk to us.
See the top news on Match Group
See the top news on Tinder
See the top news on Grindr
Match Group at New Street Research – Online Dating Summit
Q: What was the most surprising opportunity and challenge you encountered when you joined Match Group?
Bernard Kim: The most pleasant surprise was how welcoming the team was and their openness to new ideas and change. Having been in similar situations before, I know that some teams can be hesitant toward newcomers. But I was impressed by how the team embraced me. The unexpected challenge was how quickly we needed to work on Tinder.
Q: Do you agree that Match and Tinder are at the highest risk due to oversaturation in the online dating market, as investors often suggest?
BK: I see it as a big opportunity, not a risk. Initially, marketing and product weren't aligned, so I saw a chance to improve. The stigma around online dating is gone, and now we need to focus on engagement.
Q: When you look at the product roadmap, what are the things that you are most excited about for the Tinder team?
BK: Laying out the product roadmap. We have to rebuild trust with investors. Accountability is very important and we know we need to execute this year.
Q: Justin McLeod thinks Hinge should be a $1B business. What do you need to see from Hinge to turn it into a 1B business?
BK: Match Group is excited to have Hinge and Justin on the team. I do think we are still on an early runway of what we can do with Hinge. Hinge's focus on product innovation and execution has been successful, and now the company is moving towards global expansion and monetization. After thorough testing, Hinge X was launched at $50 and Hinge+ was lowered from $35 to $30. Hinge is currently being rolled out in the EU and generating excitement among users.
Q: What's your view on the mixed perception of the Hyperconnect deal? How did you view it when you bought it, and what have you learned since then?
Gary Swidler: We acknowledge that our investors may not be entirely satisfied with how it has turned out so far. However, we remain committed to the long-term potential of the acquisition and are working to improve profitability. Azar, the one-to-one video chat app, is performing well, but Hakuna needs more work. We have a new head of Hakuna with a new strategy, and we are eager to see how that unfolds. Despite challenges, we have successfully returned Hyperconnect to growth, and we see a lot of potential for the acquisition in the Asian market.
BK: The story of Hyperconnect is not completely told. I joined the company post-Covid and we have not had as many IRL meetings as we would like. A lot of magic happens during in-person meetings. Despite the challenges, I do believe that the talent at Hyperconnect is well-positioned and super-motivated.
Q: Let's talk about in-app payments. Do you think there is a change coming?
GS: This year is critical as the current app store policy needs to change. I believe they need to comply by the end of 2023. The discussions with regulators on what's fair will continue throughout the year.
BK: Gary mentioned fair and unfair. App store fees are a big issue. Match Group spent $600M+ on fees last year, more than R&D. It's unfair and needs to change.
Q: How important is advertising for the long term?
BK: It's important, but we need time to get there. Young people experience in-app content differently than older generations, and we need to be open to this, especially since most of our users don't pay.
Q: What's the plan for M&A and buy-back over the next 12-18 months?
GS: Our cash flow this year is over $800M. We've been successful with M&A in the past, but buying back stocks also makes sense. We'll continue to consider both options.
Q: What do you think your role is in mental health and trust and safety across the industry?
BK: Our role in mental health and trust and safety is crucial for our survival. We have invested heavily in building tools within our apps to verify users and create a better experience.
Online Dating (Investors) Summit, in New York
OPW – New Street Research, assisted by Courtland Brooks, is organizing the Online Dating (Investors) Summit in New York tomorrow, Tuesday 14th March. 40-50 institutional and large-scale public company investors will be in attendance, along with a diverse group of public and private Internet dating company CEOs.
The CEO of Match Group, Bernard Kim, along with the COO of Tinder, Faye Iosotaluno, and CPO of Tinder, Mark Van Ryswyk will speak. The CEO of Grindr George Arison and CFO of Grindr Vanna Krantz will also be speaking.
Mark Brooks of Courtland Brooks (and OPW.news), will be interviewing a panel of private company CEOs, namely Joel Simkhai, the Founder of Grindr, and now CEO of Motto. Also Carsten Boeltz, the CEO of Online Dating Group, and Paul Rider, the CEO of SALT. Mark will then interview the CEO of happn, Karima Ben Abdelmalek.
This is a completely unique event and opportunity for large investors to meet and mingle with the CXOs of both the large online dating public companies and private dating companies to get a better sense of the challenges and opportunities for the dating industry.
Investors who are interested in joining future niche industry meetings and learning from New Street Research's independent analysis, please inquire with New Street Research.