Online dating has become an integral part of our lives. According to a 2017 study conducted by Stanford University, 39% of heterosexual and 65% of same-sex couples met each other online.
While most of us definitely heard about and may even know someone who met on Tinder, other dating apps are creeping up and challenging its leading status. And as chance would have it, one of Tinder’s earliest employees is challenging that exact status. Meet Whitney Wolfe Herd and her company Bumble.
How Bumble Works
At first sight, Bumble seems to operate just like any other mobile dating app. Users can swipe others and if there is a mutual like, receive a match and have the chance to connect through chat. The key difference is that with Bumble, women make the first move.
That means if there is a match between heterosexual users, the woman has the chance to write her match within the timeframe of 24 hours. If she chooses not to, the match simply expires.
In recent times, the #MeToo and #TimesUp movements have highlighted the importance of removing sexual misconduct and gender discrimination. Bumble, through its women-first culture, wants to empower its mostly female users to change traditional stigmas of dating. This is best exemplified by the company’s mission statement:
Bumble is a platform and community that creates empowering connections in love, life, and work. We promote accountability, equality, and kindness in an effort to end misogyny and re-write archaic gender roles.
While we covered the love part of that statement, there is other venues of the human life Bumble tries to tackle. More specifically, they implemented features to find friends (Bumble BFF) and improve your career (Bumble Bizz).
Bumble BFF, as the name indicates, is focused on friendship. Here, people can find same or different sex people to become friends. Its functionality is similar to the core dating app in that people swipe and can start chatting once there is a match.
Similarly, Bumble Bizz is a matchmaking platform for others to increase their professional network. Its intention is to find people to learn from or simply get referred for a new job. Especially freelancers are using the platform to find new assignments.
A Quick History Of Bumble
At 22 years old and right out of university, Wolfe Herd helped launch Tinder. In the Masters of Scale podcast hosted by Greylock founder Reid Hoffman, Wolfe Herd laid out the framework by which Tinder grew from local campus popularity to worldwide fame.
Those initial days of setting up the firm became instrumental to her success at Bumble. The team showed tremendous awareness of its initial user base, that is young and independent college students. For instance, the team used to visit college campuses and speak to the students directly. With males for instance, she would tell them how easy it was to find a girl for the night.
One of the many innovations Tinder created was the ability to use the app for free. Back in the early days, the majority of dating apps required users to pay upfront (for instance through monthly fees), which allowed Tinder to grow at the scale it did.
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But with all that growth and complexity, Tinder soon became a place of meaningless hook ups paired with incidents of harassment and sexual misconduct. And soon after, when Wolfe Herd left the company in 2014, she accused the very same company she helped to found of exactly that behavior.
After Wolfe Herd settled with Tinder for an undisclosed amount, she fell into a deep depression:
“But it devastated me, and it made me just – it just made me so depressed. And I started to realize that there was something wrong with the internet. I started to realize that the lack of accountability on these social networks, it was a real thing. And there was a real risk to that. And I was a perfect example of how dangerous it could be. And if I, at 24 who had already had a somewhat successful career and had great friends and family around me, and I still could barely get out of bed, and I could barely see straight, it depleted every ounce of confidence that I’ve ever, ever had.”
With all the media scrutiny and backlash turning against her, Wolfe Herd was ready to turn her back against the tech world and its misogynistic behavior. And it was around that time when a successful tech and dating entrepreneur named Andrey Andreev contacted her.
Andreev is primarily known for being the founder and creator of the dating app Badoo, the world’s second biggest dating platform right after Tinder. The pair hit it off immediately. While Andreev wanted her to work as CMO for Badoo, Wolfe Heard had other plans in mind.
Armed with a $10 million investment from Andreev, which got him a 79% stake in the company (Wolfe Herd received 19 percent), the two got to work. Bumble utilized the technological expertise of Badoo and launched the app in December 2014.
Right off the bat, the app received over 100,000 downloads in its very first month. The app’s user base was immediately drawn to its female-empowering branding and user experience.
Bumble continued to expand its user base over the following years. Yet, Wolfe Herd would soon find herself in a conflict that was forcing her to pick sides.
A 2019 article by Forbes Magazine revealed behavior of sexual misconduct and misogyny over at Badoo, which was continued to be led by Andreev.
Both Wolfe Herd and Bumble’s PR team were quick to point out that they were “mortified by the allegations”, yet would avoid calling out Andreev or any other Badoo employee for that matter.
A few months later, Andreev decided to sell off his stake in Bumble’s parent company MagicLab to private equity firm Blackstone while simultaneously stepping down from the company.
As a result of the sale, Wolfe Herd became the new chief executive of MagicLab, overseeing both Bumble and Badoo. She would also get to keep her 19 percent stake in Bumble.
Despite these allegations, Bumble continued to exponentially grow its business. 2020, in particular, had been a very potent year for the company. Stay at home orders saw masses of people flock to dating apps to maintain some form of human connection.
The increase in usage not only generated more revenue, but furthermore allowed Bumble to invest heavily in recruiting world-class talent. It was able to hire superstar executives such as ex-Pixar Studios CFO Ann Mather or former CNBC CEO Pamela Thomas-Graham. Today, more than 70 percent of Bumble leadership is comprised of females.
It therefore came as no surprise when Bumble finally filed to go public in January 2021. It IPO’d a month later on Valentine’s Day. At age 31, Wolfe Herd became the youngest ever female founder to lead a company to an IPO (and a billionaire on top of that).
Today, over 40 million people are using Bumble’s app every month. Furthermore, over 1,000 people are now employed by the company on a full-time basis.
How Does Bumble Make Money?
As previously stated, Bumble’s core features are free to use. That means people can swipe and chat free of charge. The way Bumble monetizes its user base is through premium add-on features called Spotlight and Boost.
Spotlight works similar to Tinder’s Boost function. By paying two Bumble coins, a user is put in front of the match queue and thus receives increased visibility. Once purchased, the Spotlight function lasts for 30 minutes.
Users can purchase coins in the app. Notably, prices for coins vary across countries and regions.
Another premium function is called Boost. This feature allows users to:
- Match again with old connections
- Receive unlimited search filters
- Swipe without limits
- Receive a list of everybody who liked you
- Extend matches by another 24 hours (up to 48 hours then)
As opposed to Spotlight coins, Boost is bought on a periodic basis. Users can select to purchase the function for a week, month, three months or lifetime.
These premium add-ons work across all three Bumble functions, namely BFF, Bizz and Date.
Boost falls under the subscription business model that charges users fees on a recurring basis. This is similar to how Netflix operates, where users can use different price packages that are paid on a monthly basis.
How Much is Bumble Worth?
Bumble was valued at $8.2 billion when the firm went public in January 2021. That valuation has remained roughly the same.
Today, Bumble’s market capitalization is equal to $7.1 billion, representing a slight downtrend.
For reference, its biggest rival Match Group (owner of Tinder, amongst others) is currently being valued at $40 billion.
Bumble Mission & Vision
Bumble’s mission is to develop “platform and community that creates empowering connections in love, life, and work.”
They try to achieve this by promoting “accountability, equality, and kindness in an effort to end misogyny and re-write archaic gender roles.” There, women always make the first move on Bumble!
Conversely, their vision is “a world free of misogyny, where all relationships are equal.”
The Bumble Ambassador Program – Fueling Growth Through Brand Advocates
To spread the brand message, Bumble utilizes brand advocates who promote the app in their respective campuses and cities and even countries.
On the celebrity side, Bumble already partnered up with the likes of Serena Williams, Priyanka Chopra, and Erin Foster amongst others. Especially in a country like India, where traditional arrangements still make up 94% of all marriages, is where an advocate like Chopra can help spread an alternative message.
On a smaller scale, the Bumble Honey and Queen Bee programs allow women to spread the message on their campus and hometown respectively. They often organize two or three Bumble events a month, which helps to build loyalty and an awareness for the brand message.
The ambassador approach may not be a unique selling proposition, but as Chelsea Cain Maclin, Director of Marketing at Bumble, states:
“Our ambassadors and our Queen Bees and our college local bees, who are all different types of ambassadors, are primarily women as well. I think if you have a mouthpiece—whether that’s through our content, our ambassadors or even our success stories—that is focused on fostering meaningful relationships in life, not just across dating but across friendship and business, it creates not only a community of women that are supporting other women, but it also helps us as a brand market our core values and our mission in a way that’s truly authentic.”
Key Takeaways
- Bumble was able to capitalize on some of the biggest social movements of our time by empowering women to make the first move
- Not only does Bumble possess the necessary capital and technological capabilities (through Badoo and Andreev), but clearly understands the pains and preferences of its core user base
- On the business model side, the company follows a traditional approach, offering a free-to-use app with chargeable premium features
- As it is believed, their road to success most likely includes an IPO in the next year or two
Update 09.11.2019: Private equity investor Blackstone Group acquired a controlling stake in MagicLab, the holding behind Bumble and Badoo. The deal values the overall business at $3 billion. Andreev will step down from his acting CEO role.
