Acquisitions

IAC is positioning itself to be the center of the online dating world. Its 150 brands are cornering the market, particularly Match.com, OkCupid, and popular dating app Tinder. Now, it’s added How About We to its roster. Neither IAC or How About We disclosed the purchase price.

How About We offers a unique twist in online dating – focusing on the offline part of the process. Members can create date ideas, post them to How About We, and see if anyone cares to join them on the date. This bypasses the typical process of scrolling through profiles and matches as you would do on other sites.

The company has gone through a lot of changes in the last couple of years, starting with broadening its reach to include curated dating services for couples (extending their user base and approach beyond just the singles market). More recently, the company purchased popular online dating site Nerve.com, and added three new content websites to the mix to offer editorial on dating advice, celebrities, sex, relationships, and other hot topics.

Did it spread itself too thin?

According to the New York Times, How About We co-founder Aaron Schildkrout (now the chief executive for This Life, Inc., the parent company of How About We) thinks this will only broaden their opportunities. “We spent the last five years building and scaling HowAboutWe; our unique ‘offline dating’ experience has been used by millions of people and has helped many, many people fall in love. Our new partnership with IAC will help us bring this dating experience to an even larger number of people than ever before.”

This contradicts his statements earlier this year, where he positioned the company to compete heavily with IAC. “The online dating business is completely monopolized — IAC owns online dating,” Schechter told Fortune in January. “So what we’re trying to do is build a media company whose sole focus is love. And we think that’s the way to beat IAC.”

The How About We dating service and media properties were sold to IAC, but a portion of the company remains independent: the couples service. Last month, employees were reportedly left in the dark about whether or not they would be fired in the wake of the acquisition, with some being promised they would stay only later to find that offer recanted.

According to the New York Times, some employees will be moving to IAC, others will be staying to work on the couples service, and some have been laid off.

Usually when we talk about online dating and hook-ups, it’s to discuss what everybody’s using Tinder for. Today, it’s about a $90 million merger agreement between Fairfax Media’s RSVP dating website and Ten Network Holdings-backed Oasis Active. The two are teaming up amid growing overseas competition in the online dating market.

Prior to the merger, RSVP was wholly owned by Fairfax, while Ten controlled about 40% of Oasis and shared the registry with other investors including co-founders David Heysen and Daniel Haigh, former Star City, Engin and Solution 6 boss Neil Gamble. Although the companies have been rivals at each other’s throats for some time, they’re now putting aside their differences for a marriage of convenience (but plan to keep their maiden names and their respective management teams).

Following the transaction (which will be conducted in a combination of cash and RSVP shares), Fairfax will have a 58% stake, Ten will hold 17%, and Heysen and Haigh will hold 14% of the company. Their combined business will be managed collectively by the RSVP and Oasis executive teams.

The merger is part of a larger trend for Fairfax over the past two years. Fairfax, the publisher of Business Day, has sold a number of digital assets in that time, including online accommodation business Stayz to United States rental operator HomeAway for $220 million and New Zealand auction website Trade Me in late 2012. Fairfax purchased RSVP, Australia’s largest dating website, in 2005.

Oasis launched in 2008 and is now one of Australia's largest free online dating sites. It has an overseas presence in countries including Colombia, Chile and Mexico, but that’s not enough to take on huge international rivals like eHarmony and Tinder. RSVP and Oasis hope that, by combining forces, they can reach new markets neither company could touch individually.

"Oasis has always admired the RSVP brand in Australia and we look forward to working with a business that has been one of the major players in the Australian market for more than 15 years," Mr Heysen says. “Together we can ensure that we continue to develop our products to cater for a wider range of the Australian singles market as well as collectively develop ways to best leverage rapidly changing technology.”

“Oasis and RSVP are two of the strongest brands in the online dating market in Australia, and together they will be even stronger,” adds Ten Network’s Chief Digital Officer, Rebekah Horne. “The partnership of Ten Network, Fairfax, Oasis and RSVP will create a powerful business with myriad growth opportunities, here and overseas.”

Online dating is about to get a major shakeup. And when I say major, I really mean major. Spark Networks, which owns popular dating sites like JDate and Christian Mingle, has put itself up for sale and has at least one prospective suitor.

The big news comes on the heels of the company unexpectedly postponing its annual shareholder meeting in June, two days before it was scheduled. The move allowed Spark Networks to put its focus on the potential deal and to sidestep a board battle with its largest shareholder, Osmium. Things have been tense lately with Osmium, a San Francisco hedge fund that has been pushing for board seats over concerns that Spark has been neglecting to allocate sufficient funds for JDate while over-spending on Christian Mingle.

Spark has spent $120 million in direct marketing on Christian Mingle since 2011, which has helped grow Christian Mingle’s subscribers by almost 700 percent since 2010. Revenue is also up, from $45 million in 2008 to $70 million in 2013, but along with those efforts came dramatically increased costs as a percentage of revenue.

Meanwhile JDate, the most famous and lucrative site in the Spark Networks arsenal, looks to be going through a rough patch. According to Osmium, the Jewish dating site posted revenue of $6.1 million in the first quarter – its lowest level since 2006. Jewish subscribers have also declined to  2006 levels.

All of this is coming at the same time as big-time changes for the Spark Networks board. When the delayed annual shareholder meeting finally took place, four of the company’s six sitting directors were nixed, including Chairman and CEO Greg Liberman. The shareholders instead picked four directors nominated by – surprise! – Osmium. One of the two Spark directors who was re-elected, Thomas Stockham, resigned not long afterwards.

“The new board is eager to work alongside Spark employees with a renewed sense of urgency, accountability and focus, in order to drive increased shareholder value,” said Osmium’s founder and new Spark director John Lewis to the New York Post.

As for what’s happening with the sale of Spark Networks, everyone involved is remaining tight-lipped for now. The name of the prospective buyer has yet to be revealed, but the New York Post notes that “the world of online dating companies is small and currently dominated by Barry Diller’s IAC, which owns popular dating sites Match.com, OKCupid and Tinder.”

The reach of IAC in online dating is enviable to its competition. The company owns Match.com, OkCupid, and has a majority stake in Tinder, and now they are looking to acquire a new company with a sizable chunk of the online dating market – How About We.

The buzz has already been growing about the possible acquisition, at least among the company’s employees. When there’s speculation about such a move, the first thing on employees’ minds is – will we still have a job after this acquisition happens?

According to a letter obtained by Business Insider, co-founder Brian Schechter addressed employees directly about the matter:

Indeed, we are still finalizing a deal and zero final decisions have been made. That a deal is even a possibility should remain completely confidential. I know this is a bumpy – and let’s face it – a weird moment but we should proceed in a manner that is really smart, graceful, and empowering for everyone.

It is a strange move considering the recent history of How About We. Earlier this year the company snatched up Nerve.com to compete with IAC. How About We wanted to build its brand in a different way – through its content and unique premise, including three new websites created in addition to Nerve.com. They also wanted to appeal to couples as well as singles, putting more marketing efforts into their How About We for couples date planning service. Most importantly, they wanted to distinguish themselves from the online dating giant IAC.

Despite the potentially lucrative news for co-founders Brian Schechter and Aaron Schildkraut, things have not been going smoothly, at least as far as employee trust and loyalty.

According to Business Insider, to whom the original letter was leaked, one staffer claims many employees had individual meetings with Schechter and Schildkrout last week on Wednesday and Thursday in a glass-walled conference room. During those meetings, the staffer said they were notified they could be fired due to budgetary restrictions when the company transitions to IAC. The founders relayed that after Monday they would know "how many people can stay."

However, it was also reported that three employees were later texted that they would be able to keep their jobs. However, Schechter recanted the offer when one of those employees reminded him of a recent raise.

Regardless of what ends up happening with the acquisition, the handling of it has been anything but “smart, graceful or empowering.” Maybe it’s time for How About We to end the date and move on.

Once upon a time, back in the 2000s, Hot Or Not was a phenomenon sweeping the Web. By now most of us had written the site off as a piece of early 21^st century nostalgia, but it’s just gotten a mobile makeover and has plans to join the booming online dating business.

The new version of the addictive rating game is owned by UK-based online dating company Badoo, and is now available in the iTunes and Android app stores. Like other mobile dating apps, Hot Or Not uses location-based data to show you the most attractive people in your vicinity. That idea is nothing new. What Hot Or Not hopes will catch users’ eyes is the app’s customized Hot Lists, which are based on how users vote on profiles created in-house of celebrities, politicians, authors, and other recognizable figures.

The Hot Lists feature calculates a person’s hotness based on user votes, then updates in real-time to show the prettiest people near you. The radius the real-time Hot Lists span depends on the number of users active in a given area – so the more users who are around, the more the radius will shrink to keep it localized.

The rest of the app works exactly as you would expect a mobile dating app to work. Users can connect their Hot or Not profiles to Facebook, which autofills their Hot or Not profiles with their Facebook likes and profile pictures. In the games section, users can browse the profiles of other members in their area and rate them with a heart (for “hot”) or an X (for “not”). If a user hits the heart, they can strike up a private conversation with the person who tickles their fancy.

Russian entrepreneur Andrey Andreev, who launched Badoo in Spain in 2006, is the man behind the plan to bring Hot Or Not back. Badoo is one of the largest international dating sites in the world, with roughly 200 million users in 180 countries, but its presence in the US is lacking. Andreev hopes Hot Or Not will change all that. So far, he claims the new Hot or Not app has amassed 10 million users in its short lifetime.

It’s impossible to prove the validity of Andreev’s claim, but according to the Google Play store, the app has been installed on Android devices between one million and five million times. In the iTunes App Store, shortly after its release, the Hot or Not app ranked 321st overall and 21st in lifestyle.

You can download the app for iPhone, Android, and Windows phones.

There are many online dating sites and mobile apps competing for the same market of single men and women, looking for innovative ways to position themselves differently than “just another dating site/app.” But How About We continues to make innovative moves in this industry and buck the trends, including its initial hook – taking online dating offline for better results. Now they're also offering services to couples and getting into the digital content space.

Online Personals Watch recently interviewed CEO Aaron Schildkrout about the success and challenges of How About We, the choices he’s made, and what he wants to do next with the brand.

How About We is focusing on the couples space, since Schildkrout claims it will be "twenty times bigger" than the dating space will be. The fundamental problem with dating sites is that it works to their advantage for people to stay single and looking, so the focus is on gathering more subscribers, not necessarily making a product that helps customers meet their goals of finding partners. Shildkrout maintains that meeting up in the real world works better for singles, which is why they made it their focus.