WALL STREET JOURNAL – Mar 6 – Dating apps are taking a platonic turn. An analysis by venture-capital firm Andreessen Horowitz showed friend discovery is the fastest-growing category of mobile social apps in the U.S. Citing data from Apptopia, with friendship apps like Itsme, Wink and Yubo being the fastest-growing apps nationwide. Bumble BFF accounted for 9% of its total monthly active users as of Sep 2020. That traffic seems to have come mostly organically. Match Group has also been chasing friendships and other platonic connections. It estimates this market is twice the size of dating. Match Group paid $1.7B in cash and stock for South Korean social-media company Hyperconnect in its biggest acquisition ever. Hyperconnect is already generating profits and did $200M in revenue in 2020, up 50% YOY. Hyperconnect owns two video apps in Azar, which is the highest grossing one-to-one video chat app in the world; and Hakuna, which offers group live video, audio and avatar-based streaming.
Category: Reporters – Laura Forman
Match Owns Dating’s Past, Present and Future
Bumble’s Bet on Women Won’t Pay off Everywhere
WALL STREET JOURNAL – Jan 21 – A higher percentage of the Bumble app's users convert to payers than the market average among dating apps, according to OC&C Strategy Consultants – ~9% paid conversion among its 12.3M monthly active users, the company said. But a women-centric approach also could pose some limitations to growth. Historical gender norms might be more difficult to disrupt outside the U.S. In India, Bumble didn't break the top 10 in terms of consumer spending. Interestingly, Tinder tested a feature in India around the time of Bumble's launch there called "My Move," which allowed women to initiate conversation. Depending on its success, Tinder said it would consider launching the app more globally. Ominously for Bumble, Tinder hasn't indicated plans to roll out the feature anywhere else.
Bumble’s Buzz Won’t Sting Match
WALL STREET JOURNAL – Sep 3 – Bumble IPO would disrupt the virtual monopoly that Match Group has long enjoyed in the public dating scene. But whether Bumble can turn investors' heads likely has less to do with what it could print in a public offering filing and more to do with the pace at which it manages to grow over time. The company has held its metrics close to the vest, but is widely seen as a solid competitor to both Tinder and Hinge. Match saw an increase in usage among younger users and females during the lockdown. That would bode well for Bumble since younger female users are a key demographic. Messages sent on Bumble increased 20% in the U.S. the week ended May 1 versus the week ended March 13, while Match said the average number of daily messages sent across its platforms was 27% higher during the month of April versus the last week of February.
As Match Breaks Away, Investors Shouldn’t Break Up
WALL STREET JOURNAL – Apr 13 – Like many of its Internet peers, shares of Match Group fell precipitously through mid-March as investors feared users would abandon subscriptions in the face of lockdowns. In an investor update on March 31, Match noted results would likely be around the low end of ranges it previously shared. And while the company also said it could be challenging to boost revenue sequentially in the second quarter, it still expects to show YOY growth. Match said the length of conversations on Tinder is up anywhere from 10% to 30% in many countries. Tinder accounted for 56% of Match's revenue in 2019. Relationship-focused app Hinge has seen a 30% increase in messages in March compared with January and February. A recent survey from Jefferies highlighted growth opportunities across Match's portfolio. The survey showed that, while just 13% of dating-app users say they already pay for services that increase their chances of finding a match, 47% said they were likely to pay for those services in the future.
IAC Spins a Compelling Prospect
WALL STREET JOURNAL – Sep 26 – IAC is considering spinning off one or both of its biggest assets: Online-dating giant Match Group and ANGI Homeservices, which owns HomeAdvisor and Angie's List. Analysts estimate Match and ANGI combined will comprise 71% of IAC's total revenue in 2019. Investors seem to be puzzled, sending IAC shares down ~14% this month, although some of this weakness was related to the Federal Trade Commission suing Match. Analysts, however, see hidden value in IAC's remaining assets such as Vimeo and Dotdash. The full remaining portfolio could be worth quite a bit if it had the company's complete attention. IAC could generate revenue of $1.5B in 2020, rising to $2B by 2024. Assuming IAC unloads $1B of debt to Match and ANGI, analysts see valuation upside of 9% to 26% from current levels if both assets are spun off.
Females ‘Ship’ MatchGroup’s New Dating App
WALL STREET JOURNAL – May 21 – Match Group has teamed up with millennial digital brand Betches to create Ship, which was launched in January. Ship allows friends to vet potential mates for one another. On its first-quarter conference call in early May, Match said Ship is seeing strong engagement in big cities. The company said ~70% of registrations thus far are female and ~60% of matches are made by friends.