The Match Company Gets Ready To Go Public!
Do you know what popular dating sites Match.com, OkCupid, Tinder, and Plenty of Fish have in common? Well, they are all part of the Match Group of internet dating services which is owned by a single parent company, IAC/InterActiveCorp. This American media and internet business has over 150 brands across 100 countries. 🙂 Recently The Match Group has found some deep-pocketed suitors on Wall St., such as JPMorgan, and Bank of America Merrill Lynch to help it go public.
Once the IPO goes through, Match will be listed on the NASDAQ exchange under the $MTCH stock symbol. It hopes to raise at least $100 million with its initial public offering. Aside from the 4 dating services already mentioned, it also owns about 40 other brands in the online dating space. 🙂 The Match Group products are particularly popular in North American and European markets, and reach more than 190 countries world wide.
Should You Invest in Online Dating?
I’m not usually one to be interested in IPOs. But this one caught my attention because of how fast the online dating space has grown over time. The National Academy of Sciences researched thousands of people who got married between 2005 and 2012 and discovered that more than 33% of those marriages began with online dating. And those people may be slightly happier than couples who meet through other means. Match services have been quite popular with millennials. I’ve used a couple of these sites myself in the past. I talked to this one girl online, but we just didn’t click.
Match generated $888 million of revenue last year, up about 11% year-on-year. It had a net income of $148 million, up 18% year-on-year. Here’s a look at the company’s financials, (click to enlarge) sourced from businessinsider.com.
Match Group currently reaches about 59 million active users per month, with 4.7 million of these being paid users. Even though most of its revenue is coming from paid membership fees right now, the company says that advertising revenue could be a big source of future growth. Unlike a new gadget or fad, online dating has been around for many years and with more people using the internet I think this market will continue to expand. 🙂
With net earnings of $148 million, and a history of bottom line growth, I would confidently invest in this company today if it’s market capitalization was reasonably priced at $2 billion or less. But if speculators push this all the way past $20 billion then I’ll pass. We’ll have to wait and see the valuation when it becomes available.
Random Useless Fact:
Match bought Plenty of Fish for over 500 million dollars. Perhaps instead of investing in a dating corporation you should start your own?
Maybe I should start a dating site just for personal finance bloggers lol. Members would recieve suggestions on potential dating partners based on compatible spending habits and financial goals. 😉
Just imagine PF bloggers hooking up and having kids. Their kids will get spreadsheets for presents, and will be forced to save for their own education as soon as they can walk 😀
I’d say it needs to be the opposite – one nerdy PF blogger needs to be hooked up with somebody who can bring fun into relationship (without ruining him/her financially of course). At least that’s what I did 😀
It’s probably a good thing that opposites tend to attract each other. 🙂
I heard POF was started by a Vancouver college kid and been run that way for most of its life. 500M is not a bad payday for him!
wow, I didn’t know they make that much money. Most internet companies are in the negative for a long while. Even uber is losing uber amount of money. Twitter hasn’t able to capitize their ads biz, running out of steam and money. I wonder how internet dating would fair after the ipo. The recent talks was there is a new tech bubble – GoPro, twitter, Zillow, where is Groupon etc, the share price has dropped like flies.
It looks that way. I think some stock traders are trying to time the best moment to sell their tech companies before the bubble comes to an end. It won’t be easy to, though.
With Justin “Tosh” Trudeau now leading the country, perhaps an article on ways to invest in the cannabis industry.
Interesting topic idea. I was thinking about a more general article along the lines of “What a Liberal majority means for investors,” so I can loop in some information about cannabis. 🙂 It’s still early and anything I predict about the future of this industry would just be conjecture. But the least I could do is list some companies in the trade for readers to do their own research on.
[…] up two new positions in November: 100 shares of TransCanada in my Canadian margin account, and 100 shares of Match Group in my U.S. margin account. The stock market was pretty flat overall. I did receive $200 of […]