Zoosk Reaches 26M Users And Files For $100M IPO

- Monday, May 05 2014 @ 06:45 am
- Contributed by: ElyseRomano
- Views: 2,233
This week’s round of congratulatory applause goes to Zoosk, which just filed its S-1 registration statement with the SEC and announced its plans to raise $100 million in an initial public offering.
The company will trade on the New York Stock Exchange under the symbol ZSK, with Merrill Lynch, Pierce, Fenner & Smith, and Citigroup Global Markets underwriting the IPO. Oppenheimer & Co. and William Blair will also be joining as co-managers.
As part of its filing, Zoosk provided details of its global online dating business. The company states that the website now has 26 million members across 80 countries, including 650,000 subscribers (users who pay for access to additional features and products). The company also states that its user base grew from 18 million at the end of the year in 2012 to its current numbers, a 44% growth rate. The number of paying subscribers grew to 650,000 in 2013 from 483,000 in December 2012.
As those subscriber numbers have grown, so too has revenue. Revenue increased 63% from 2012 to 2013, rising from $109.1 million to $178.2 million. Net loss also decreased drastically during that period, from $20.7 million in 2012 to just $2.6 million at the end of 2013. Subscriptions account for much of that revenue ($153.8 million), but Zoosk also has a rapidly growing virtual currency business that jumped from $5.4 million in revenue in 2012 to $24.3 million a year later.
On top of that, Zoosk has raised more than $60 million since being founded in 2007. Investors include Crosslink Capital, Keating Capital, Canaan Partners, Bessemer Ventures, ATA Ventures, Jeff Epstein, Plug & Play Ventures, and Amidzad Partners.
While it started out on the web, Zoosk has been hugely successful in the mobile arena. In the Apple App Store it's the #1 grossing dating app and a top 25 grossing app overall. Much of that success can be chalked up to the site's proprietary Behavioral Matchmaking engine, which learns from a user's clicks, messages and other actions to produce more compatible matches. The better the data it gathers, the better its recommendations get.
Looking to the future, Zoosk knows the biggest challenges it will face. The service must optimize its strategy for retaining current members as well as its approach to attracting new members and subscribers. Zoosk must find a way to retain high levels of user engagement and subscription rates and, most importantly, must continue honing its Behavioral Matchmaking engine in order to connect users with mutual attraction.
To find out more about this service you can read our review of Zoosk.