The Bumble dating application, which broke away from the usual dating app norm, has hit over $13 billion in market valuation after it’s Initial Public Offering (IPO). The company started trading yesterday, announcing that it was going to sell each share for $43 but by the time the trading started the shares were each going for over $76, pushing the company’s initial post IPO value of $8 billion to $13 billion.
The company is one of the few companies in the United States which announced its IPO under a female Chief Executive Officer. The CEO and founder, Whitney Wolfe Herd, has become a billionaire. The 31-year-old CEO launched the app about 7 years ago. She had financial support from Andreey Andreev, founder of Badoo, a popular online site, also under the control of Bumble.
The Bumble app is quite unorthodox in its approach since females and not males are given the opportunity to reach out to males they find attractive. Herd said she decided to take that approach as a result of the traditional methods that all other dating apps and sites use. She said she wanted to put females in charge of their fate. For same-sex matches, the app allows either individual to reach out first, CNBC reports.
Herd told investors that her experiences about how the traditional gender roles were affecting females made her think up the idea of Bumble. She is also one of the founders of Tinder, a rival of Bumble. She left the company in 2014 on the grounds of sexual harassment. Match Group, which owns Tinder tried to buy Bumble but failed. The company paid $1 million as compensation for the harassment claims even though it denied it.
In 2019, Andreev sold out his shares in Bumble and Badoo to Blackstone, a huge investment company. The deal left Herd to run the two companies. Combined, there are over 40 million users on Tinder and Bumble with over 2.4 million subscribers. The Bumble app can be accessed in almost all countries of the world and the company said it expects its value to grow more in coming years, citing the increase in singles and more reliance on dating apps.
The company also expects more profit from diversifying to other sectors such as business networking. Like all other companies, Bumble took a hit during the lockdown months of 2020. It suffered a decrease of 35% in revenue in the first three quarters of 2020, with a loss of over $116 million.