Big data meets big dating as Grindr readies to go public
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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.
