The dating app started trading on Thursday on NASDAQ under the name BMBL and soared by tens of percent and closed at a price of about $ 70 per share. Bumble was founded in 2014 after its founder, left Tinder and chose to set up a dating platform focused on female empowerment
Bumble, the dating company, received a warm welcome from Wall Street this week after pricing the shares in a public offering (IPO) above expectations. The offering gave the company a value of over $ 8 billion. The company’s stock started on Thursday on the NASDAQ under the symbol BMBL.
Bumblebee focuses on female power. The company’s platform also calls on women to turn to men and not as is usually the case.
The company, whose entrants include the European matchmaking platform “Bado”, has already sold shares at a price of $ 43 per unit after raising the suggested price from 37-39. Also, due to high demand, the company increased the number of shares for sale from 45 million to 50 million. Meanwhile, the company has raised $ 2.2 billion from investors. The company’s stock jumped tens of percent on its first trading day and closed at a price of about $ 70 per share. On the last trading day (Friday) the stock rose more than 7% to a price of about $ 75.
The company said it plans to use the proceeds of the offering primarily to purchase shares from the buyers before the offering and to pay off debts. Bumble’s private owners will retain about 97% of the company’s voting rights following the IPO.
Bumble reported that its losses totaled about $ 117 million in the first nine months of last year, with revenues of $ 417 million.
Goldman Sachs and Citigroup served as leading underwriters in the bumblebee issue.
Bumble was founded in 2014 by Whitney Wolf Heard (CEO), who previously founded Tinder. Wolf Heard left Tinder after allegations of sexual harassment. In a legal battle, she won $ 1 million in damages. In 2019, Wolf Heard sold about half of the company’s holdings to the Blackstone Fund for $ 3 billion. According to IPO documents, Wolf Heard earned about $ 125 million from the deal.
From Facebook to Tinder: a market full of competitors
The transition of the dating world to online spaces is clear and it took place long before the corona ‘but since the outbreak of the plague it seems that virtual spaces have become the only place to get to know. Therefore, more and more corporations are taking advantage of this and expanding their activities. Bumble’s main competitor is the Match Group (NYSE: MTCH), which sells mostly from the Tinder and OkCupid dating app. Match Group, for example, has risen more than 250% since last March and is currently trading at $ 171 a share.
In addition, it is reported that Match will enter the Asian market. On Tuesday, the company announced that it is acquiring the South Korean video chat app Hyperconnect for $ 1.7 billion.
Another company that will compete with Bumble is the social networking giant Facebook (NASDAQ 🙂 which announced in late 2019 that it is developing its own online dating service.
Everyone is already on Tinder so is there a chance for competition?
Joseph Scully, head of Internet and digital media research at Truist Securities, told the Financial Times that while Match has built a strong portfolio of apps in a variety of “niches,” consumers have a tendency to use multiple dating apps at one time.
“The market is big enough to accommodate a number of success stories,” Scully said. “It’s not an ‘o-o’ mode.”
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