Dating Services

Online dating provider Spark Networks has released its financial report for the third quarter of 2015, revealing a mix of highs and lows.

The company suffered a 22 percent drop in its year-on-year revenue, taking in a total of $11.7 million for the third quarter. Along with the dip in profit, Spark Networks also saw a net income loss of $822,000 for the quarter, compared to its $95,000 loss for Q2 of 2015.

But it's not all bad news. The report also highlights positive results that could mean things are looking up for next year:

• Both Jewish and Christian Networks show simultaneous subscriber growth for first time since Q1 2013
• Spark's mobile presence now exceeds over 200,000 monthly active users across five brands
• The acquisition of JSwipe expands Spark's offering for the Jewish community
• The re-launch of both JDate and ChristianMingle is on schedule for Q4 2015

CEO Michael Egan stated, "The last three months represent a true inflection point for Spark Networks and the clearest indication yet that we are on the right path towards turning this business around.” He notes four achievements in particular that he believes will be instrumental in getting Spark Networks back on track.

First, the subscriber base grew for the first time in two years. The growth was modest, but it came during what is traditionally a seasonally slow period. The momentum could carry into Q4 and Q1 2016, which are typically the strongest seasonal periods for Spark.

The second accomplishment is a record contribution margin on ChristianMingle. A new marketing strategy, and more sophisticated communications with members, has proved to be highly beneficial for the service.

Third is the launch of a handful of new mobile applications. Only a year ago, the company didn't have a single native mobile app. Today Spark Networks has nine apps across five different brands representing over 200,000 monthly active users. CrossPaths, targeted at millennial Christians seeking to meet others who share their faith, has been especially valuable.

Finally, in early October, Spark Networks closed the strategic acquistion of Smooch Labs. As the developer of popular Jewish millennial dating app JSwipe, Smooch Labs is a powerful new ally for Spark. With JSwipe added to JDate, which traditionally serves an older audience, Spark Networks now offers well-rounded romantic solutions to all singles of the Jewish faith.

Successes aside, Egan knows there is still work to be done. “We remain committed to driving revenue and EBITDA growth and continuing to execute against our product improvement roadmap,” he said. “Through both organic development and acquisitions we are proving that we can build and grow fantastic brands that serve important market niches. It is a very exciting time for Spark."

For more information on the popular Spark Networks dating sites and apps you can read our review of Christian Mingle and JDate.

Looking for a new dating app? It’s not hard to find something besides Tinder – it seems a new dating app launches every week, each with its own particular spin. But the new U.K. launch of dating app Once has got my attention, because it offers something the other apps don’t – real human matchmakers in place of computer algorithms. (We are now going back to basics with online dating.)

Once works like this: once every 24 hours, users will get a hand-picked match to either decline or accept within the next 24 hours. Dates are carefully chosen using several criteria, including interests, looks and personal preferences.

With Once, there is no auto-swiping or endless browsing or location matching like you find on apps like Tinder because the match is personally curated. But it also means as a dater, you have to have patience, because you only get one match a day.  After all, the human matchmakers have a lot of other people to cater to, not just you, and this takes time.

But patience can work in your favor, and often leaves you more interested to tuning in and seeing who your featured match will be. Chances are, you’ll accept more matches when you don’t have an endless array of potential dates to choose from – and because it’s a bit more personal, instead of computer-generated choices. The thinking is that you and your hand-picked date will have some things in common, and the likelihood of relationship success will be greater. The jury is still out on this, as Once hasn’t been on the market long enough to see results.

The dating app recently launched in France, and managed to gain 100,000 users in only a couple of weeks. Once has now launched in the UK, where real-life matchmakers will be picking daters to match in London.

"People are fed up with having just to sit and swipe through hundreds of people in the hope that they might find one person who they like and then start a conversation with," said Jean Meyer, the CEO and founder of Once in an interview with Mashable. He also noted the time-saving aspect of his app: “With Once, we’re taking that responsibility on ourselves, and are handpicking great people for London’s time-starved daters.”

While Once is available in France and the UK on both iOS and Android devices, there is no news yet on the app’s roll-out in other countries. Perhaps this adds to its mystique, to keep daters guessing. Dating Sites Reviews will keep you updated as we learn more.

IAC made major strides in the third quarter of 2015. Not only did earnings beat analyst expectations, the company also announced the $575 million acquisition of PlentyOfFish and plans to go public with an IPO.

IAC's third quarter financial results show a company that continues to dominate in its field. Highlights include:

• IAC will continue its partnership with Google for four more years. Google will provide IAC and its network partners with sponsored listings and other search-related services.
• The Match Group revenue increased 19%, or 25% excluding the effects of foreign exchange, to $274.2 million. The Match Group Adjusted EBITDA increased 37% versus Q3 2014.
• Within Search & Applications, Applications queries and revenue increased 28% and 2%, respectively, the first quarter of revenue growth since Q3 2013.
• In the Media segment, Vimeo grew paid subscribers 22% to over 650,000 with revenue increasing 27%.

Greg Blatt, Chairman of The Match Group, believes the company has plenty to look forward to. “We expect to complete our acquisition of PlentyOfFish this week,” he said in a prepared statement, “adding another of the leading global dating brands to our portfolio, at which point we will have over 59 million monthly active users and 4.7 million paying users. All in all, a solid quarter with lots of positive activity.”

Tinder is still one of the hottest topics in the dating world. The Tinder subscription business continued to perform well in Q3 2015. “We have been able to deliver optional paid features that a portion of our users highly value,” said Blatt, “while enhancing the vibrancy of the community through their introduction.” Though monetization is important for Tinder's success, the app focus primarily on growth initiatives going forward.

The other big news for The Match Group is the forthcoming IPO, which is expected to be completed during the fourth quarter of 2015. IAC will sell a 14 percent stake in Match Group, offering 33.3 million shares priced between $12 and $14 to the public. At the midpoint, Match Group will raise $433 million.

The IPO is not without its detractors. In an article for Forbes.com, Peter Cohan outlines four reasons the IPO isn't worthy of a right swipe from investors. He notes that the structure gives the public shares very little voting power, that the proceeds go to repaying the parent company's debt, that the valuation is far below what analysts expected, and that the underwriters are weak.

Multiple similar companies have pulled their IPOs in 2015, including online dating platform Zoosk. It will be interesting to see where The Match Group goes in the final quarter of 2015. For more information on IAC's flagship dating services, you can read our Match.com review and our Tinder review.

There’s no doubt about it: JDate is a big name in the world of online dating, and when it wants something, it will go to great lengths to get it. And recently, its parent company Spark Networks decided that it wanted popular dating app JSwipe, owned by Smooch Labs. The two companies struck a deal in late October, and now JSwipe is one of the dating properties of Spark Networks, along with dating sites Christian Mingle and Black Singles in addition to JDate.

JSwipe, which launched in April of 2014, has grown rapidly, with over 450,000 downloads worldwide and over 40 million messages between users. The dating app was definitely posing some competition to JDate, and attracting a younger user base who prefer apps to the traditional dating websites. This made the company an attractive target for Spark Networks, JDate’s owner.

In fact, JSwipe and JDate have had a tumultuous dating history, so to speak. Earlier this year, Forbes broke the story that JDate was suing JSwipe for copyright infringement because JSwipe was using the trademark “J” in the name of their app. In the lawsuit, JDate also claimed it owned the patent on software that “confidentially determines matches and notifies users of mutual matches in feelings and interests,” which would ultimately interfere with all dating apps using this technology (in other words, all dating apps).

JSwipe at first fought back, going to the press with the story of the lawsuit and calling out JDate for trying to shut the app down. JSwipe also started an IndieGoGo fundraising campaign to help them fight the lawsuit against JDate, assumingly because they didn’t have the funds to fight on their own. As it turns out, either the company ran out of money, or JDate put forth a really compelling offer, which Spark Networks said they would reveal later in the company’s 4^th quarter financial statements.

The lawsuit has been dropped and Sparks Networks put out a press release, praising the new relationship between JDate and JSwipe. Michael Egan, Chief Executive Officer of Spark Networks, stated in the release, “We’re very excited to welcome the Smooch Labs team into Spark.  They’ve created a fantastic mobile application that helps young Jews meet and form meaningful relationships, and together with JDate, our leading Jewish focused dating platform, Spark is now able to significantly build on its mission to strengthen the Jewish community through dating and marriage.” David Yarus, founder of JSwipe had equally glowing statements about the union.

While JSwipe remains free to download right now, Sparks Networks has promised that new paid premium services will be rolled out in the near future. For more information on JDate you can read our review of JDate.

If Tinder has been a sea of left swipes lately, the app's recently announced update could change your luck for the holidays. Tinder’s founder Sean Rad announced forthcoming changes to the algorithm during Ireland’s Web Summit on November 4.

The update is set to be Tinder's biggest yet. "It's been our mission since day one to uncover ... every possible meaningful relationship," Rad told Mashable. In service of that goal, Rad says the company is looking to "reduce the barriers to people connecting" and help them form "deeper connections." He claims the upcoming changes will boost connections made on the dating app by 30%.

Unfortunately, actual details about the algorithm update are scarce. Tinder has not yet made a formal announcement and is keeping mostly mum until then. Rad only said to expect a "series of things you're going to see that will help you make more sense of the sheer volume of people around you and build deeper connections...and more ways to connect."

What Tinder is talking about is its reputation as a “hookup app,” which its eager to shed. Rad made yet another attempt to distance the company from that status, adding that 80% of users are looking for long-term relationships.

This year has seen Tinder release features designed to make the app more engaging. Not long ago it launched 'Super Like' - a function that can only be used once a day to let a user know you really (like, really really) like them. Rad compares it to walking over and saying hi to someone, instead of winking at them from across the room.

The CEO also shared some of Tinder's impressive numbers with the Web Summit. The app currently receives 1.6 billion swipes per day, 26 million matches per day and 9 billion total matches since its debut in 2012. As a result of those swipes, 1.5 million in-person dates stem from Tinder each week. More than half of those make it to a second date.

Up next, Tinder will focus on monetization. Most of the company's revenue currently comes from Tinder Plus, a paid service that allows users to search outside of their geographical location and undo swipes. Advertising hasn't yet hit the app in a major way, but there will be a bigger focus on ads in the near future.

Rad is nothing if not confident about Tinder's success. "There is no doubt that Tinder is increasing the number of connections in this world," he said. "We are bringing the world closer together at a scale that no platform has ever been able to do and in that sense, we are changing the world."

For more on this popular dating app, please read our Tinder review.

Plenty of Fish may have taken a backseat to services like Tinder in terms of cultural recognition, but 2015 has been a big year for the company nonetheless.

In March, POF released its revenue numbers for the first time. The dating app and website reached 100 million users worldwide and announced that its run rate – the revenue a company can expect to bring in if business continues as it has so far that year – for 2015 was expected to hit $100 million. That's a dollar per year per user, even though most POF users don't pay a dime for the service.

In July POF was acquired by Match Group, an IAC/InterActive subsidiary, for $575 million in cash. Match Group had purchased a number of dating services over the previous six years, including How About We and OkCupid. Add those to Tinder, which Match had funded early in its lifetime, and Match Group became a serious power player in the online dating world.

After much speculation, Match Group filed for an IPO in October of this year with a tentative offering amount of $100 million. It will operate under the ticker symbol "MTCH" on NASDAQ.

And that's not where the big news ends for Plenty of Fish in 2015. As part of Match Group's filing with the SEC, the company revealed POF's current financial status. This is only the second time the public has seen POF's revenue numbers.

POF's revenue is divided into two categories: subscription and advertising. The majority of the website's funding comes from subscriptions, which make up 75% of POF's income compared to 25% from ads. POF currently estimates 2015 revenue to be $80 million.

With a little math magic, we can find out how many paying users Plenty Of Fish has. Seventy-five percent of $80 million is $60 million per year from subscriptions. Divide that by 12 and POF pulls in $5 million per month. Then divide again by $10, the average monthly revenue per paid member, and the final number is 500,000 paid members. That's a remarkably small percentage of POF's 100 million users.

There's a reason the company relies so heavily on subscription revenue over ads. As singles increasingly favor mobile devices over computers, services like Plenty Of Fish are forced to adapt to smaller screens. Ads are more distracting and harder to read in the cramped space of a smartphone screen.

In other ways, mobile has strongly contributed to the success of POF. “Since our shift to mobile we’ve seen rapid growth both in terms of users and revenue,” says founder and CEO Markus Frind.

“Our revenue model has also evolved from one driven by advertising to one driven by paid membership,” he adds. “Now more than ever, singles are willing to pay for an enhanced user experience.”