Big data meets big dating as Grindr readies to go public
Grindr, the LGBTQ dating app, is planning to go public, becoming the third dating giant to go public in the past three years.
Why it matters: Big data has bred a slew of billion-dollar dating companies, as matchmaking increasingly becomes reliant on algorithms.
Details: Grindr plans to go public via a blank-check merger that values the combined company at over $2 billion post-transaction, the company said.
- It expects to raise an estimated $384 million with the deal, and it plans to use proceeds to continuing building products that support the LGTBQ community,
- Grindr’s existing equity holders will own ~78% of the company at closing.
The big picture: In going public, Grindr is following on the heels of Match Group and Bumble.
- Match Group, the dating company that houses Tinder, OkCupid, and others, went public in 2020 after its parent IAC, an internet holding company, spun it out as a separate company. Match Group today is valued at around $20 billion.
- Bumble, the dating app that has women make the first outreach to male suitors in heterosexual matches, went public last year. Bumble is currently valued at around $3 billion.
Be smart: Dating companies have been able to scale thanks to enormous investments in user data and technology that helps connect potential matches and hook users for hours.
- Grindr, for example, said the average daily time spent with its app per user in December 2021 was 61 minutes.
Yes, but: There's growing concern that dating apps use shady practices to sell user data for advertising purposes.
- The Wall Street Journal last month reported Grindr user data was sold through an ad network, a report Grindr called "sensationalized."
- Consumer reports have suggested for years that many dating apps, including some owned by Match Group, have shared personal user data with advertisers.
What to watch: Grindr's announcement comes amid fears that gay rights could be threatened if the Supreme Court overturns Roe v. Wade.
- "LGBTQ+ rights are under serious attack. Grindr is committed to protecting and advancing the rights of our community, and having an LGBTQ+ focused company represented in the public markets can't hurt," said Patrick Lenihan, Grindr's head of communications.