Grindr hits Wall Street
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Illustration: Sarah Grillo/Axios
On Friday, LGBTQ+ dating app Grindr finally became a publicly traded company after it consummated its merger with Tiga Acquisition Corp. The stock made its debut on the New York Stock Exchange.
Why it matters: With new CEO George Arison at the helm, the company is attempting to do a lot at once: convince the public market that it’s a worthy investment, improve its image and grow its business.
- Investors warmly embraced the stock, which skyrocketed in its first day of trading.
The big picture: Founded in 2009 by Joel Simkhai, Grindr was an early pioneer in mobile dating apps: It used the iPhone’s location feature to enable users to find potential matches nearby.
- Simkhai sold the company to Beijing Kunlun Tech in 2018 (which announced plans to take it public), but U.S. regulators forced the deal to unwind based on national security concerns.
What they’re saying: “It’s really great for me to be at a company where users have such strong attachment to the product,” Arison tells Axios. Developing the app for new uses, such as meeting people when traveling or finding friends, are among the ways he wants the company to evolve, he says.
- While Grindr is mainly used by gay and bisexual men, there’s an opportunity for the app to expand into serving all of the LGBTQ+ community, Arison added.
By the numbers: As of May, when it announced its merger with Tiga Acquisition Corp., Grindr says it had about 11 million monthly active users.
- It generated $146 million in revenue in 2021, up from $105 million in 2020. It lost $13.1 million in 2020, but made a profit of $5.1 million last year.
Between the lines: “Where we are not yet at scale at all, and that’s something we need to invest in, is the monetization of our users,” says Arison.
- About 6% of Grindr’s users pay for its subscription products; that compares to about 9% for Bumble and 18% for Tinder, per its investor presentation.
- “Subscription revenue is better revenue — it’s more predictable. It allows you to create features that users want. The previous ownership wasn’t really interested in investing in that,” he adds.
- Similarly on the advertising side, Arison wants the company to keep expanding its direct ads business.
Yes, but: About 98% of Tiga Acquisition Corp.’s stockholders have chosen to redeem their shares, according to SEC documents filed this week. Yet Arison — whose previous company, online car marketplace Shift, merged with a SPAC in 2020 — isn’t too worried.
- He cites ongoing market conditions as the reason this isn’t surprising, saying it’s just par for the course for all SPACs right now. (Shift was trading at around $0.35 a share as of Friday afternoon.)
- “Raising capital was very much not the objective of the transaction,” he adds.
The bottom line: Grindr is hoping it has finally found its perfect match on Wall Street.
