Dating-app company raised $2.2 billion through offering
Investors “swiped right” on dating-app operator Bumble Inc. Thursday, sending its shares up about 70% as they made their public debut.
Bumble’s stock BMBL, +63.51% opened at $76 a share midday Thursday before heading slightly lower to a recent $72.83. The company’s initial public offering priced at $43 a share late Wednesday, above a recently raised range and enough for the company to rake in $2.2 billion through the IPO.
The company, which runs its namesake dating app as well as sections of the app for finding platonic friends and networking connections, lets people swipe through profiles of potential matches and makes money when users pay for premium features, like the ability to see who’s already liked them on the app. Bumble also operates Badoo, a dating app that’s popular in Europe.
Bumble bills itself as focused on women’s empowerment, including through its trademark feature that requires women make the first move when messaging new connections. “We believe we have the potential to become a pre-eminent global women’s brand,” Chief Executive Whitney Wolfe Herd said on the company’s virtual investor roadshow.
Priorities for Bumble after the IPO include continued international expansion as well as further growth of the company’s BFF and Bizz properties, which are for friendships and professional networking, respectively.
While the company’s messaging around the idea of letting women make the first move in their relationships “resonates across different countries and cultures,” Bumble has also focused on understanding the cultural dynamics of each of the markets it enters so that the app has a “local” and nuanced feel, Bumble President Tariq Shaukat said.
As the Bumble brand moves to new countries, Shaukat told MarketWatch that the company is leaning on learnings from Badoo which has “deep market experience” in Europe and Latin America.
The company generated revenue of $416.6 million during the first nine months of 2020, up from $362.6 million during the comparable period a year earlier. Bumble also recorded a net loss of $118.5 million during the first nine months of 2020, versus net income of $54.0 million in the same period a year before.
Though Bumble’s average revenue per user dipped in the first three quarters of 2020, Shaukat said that the trend reflected the company’s international expansion, as Bumble can’t charge as much for its premium features in markets like India as it can in the U.S.
The company has half a million monthly active users in India, Shaukat told MarketWatch, and it sees further growth ahead.
For its BFF and Bizz products, Bumble is trying to further build an audience and refine the product, with no near-term monetization plans, according to Shaukat. Bumble BFF users, who skew female, have indicated that they see apps as “not a substitute but a complement for how people are meeting in this day and age.”
Overall, Bumble had 2.4 million average paying users as of Sept. 30, an increase from 2.1 million as of a year prior.
Bumble is coming public as the Renaissance IPO ETF IPO, +0.28% has gained 40% over the past three months and as the S&P 500 SPX, +0.17% has risen 10% in that span.