Contributed by: ElyseRomano Monday, June 26 2017 @ 09:33 am
After purchasing 62 percent of the gay dating app Grindr last year for $88 million, Beijing Kunlun Tech is shelling out another $152 million to buy the remaining percentage. The Chinese tech company is now the sole owner of Grindr, which reaches 27 million users in nearly 200 countries.
Unlike Taiwan, which recently legalized same-sex marriage, China affords few legal rights to LGBT citizens. Nevertheless, companies like Kunlun are beginning to realize the enormous potential of LGBT customers. Kunlun hopes to expand Grindr’s reach throughout Asia and take on China’s homegrown gay dating app, Blued.
“It is of strategic importance for us to fully engage in the daily operations of Grindr and make it our development milestone,” Kunlun said in a statement. “[With the deal], we also aim to be a world leading social media company in the future, and to expand our platforms into film, streaming and animation.”
The rapidly rising valuations of some of the world’s biggest social media platforms have prompted the tech firm to build up its stake, reports the South China Morning Post[*1] . Grindr is expected to function as a new growth engine for Kunlun. Its rapidly expanding membership saw the eight-year-old app post US$13.7 million in net profit for 2014.
Though it’s not yet clear exactly how the marriage between a Chinese game developer and an American gay dating app will benefit both companies, Grindr’s founder and chief executive Joel Simkhai described the deal in a blog post[*2] as “a huge vote of confidence in our vision to connect gay men to even more of the world around them.”
The post promised that current Grindr users will continue to have the same access to the app as before, that there will be no changes to service for free or Xtra users, and that there will be no alterations to the Terms of Service. Simkhai will remain in his role as CEO.
The post also assured users that privacy remains of paramount importance to the company, and that the Chinese government will not have any access to Grindr accounts.
Kunlun has its work cut out if it wants the acquisition to be a success story. Not only does it face China’s stringent regulations designed to stop the dissemination of “pornography”, which could bar users’ access to certain apps or censor relevant contents, it also must go head-to-head with Blued.
Blued is already successful and well-entrenched in China, with 27 million registered users - a number that puts it nearly on par with Grindr. Blued completed its latest round of fundraising last year, boosting its net worth to $300 million and exceeding the combined $240 million price tag for Grindr. The race to the top will undoubtedly be hard fought.
For more information on this gay dating app you can read our Grindr review.