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Dating app Grindr hooks up with Chinese gaming investor

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The business of online dating continues to grow, as more apps enter the market and compete for funding from investors ready to cash in on the next Tinder. The latest financial news in the industry involves popular gay dating app Grindr, who just announced that Chinese online gaming titan Beijing Kunlun Tech has taken a “majority investment” in their app.

According to The New York Times, Beijing Kunlun’s stake in the company will be about 60%, with the remainder to be owned by Grindr employees and Joel Simkhai, the company's founder. The valuation of Grindr seems to be about $155 million according to the same article, although the actual amount invested was not disclosed.

Interestingly, Grindr had not raised capital from outside investors prior to their deal with Beijing Kunlun. The company was started and funded by Simkhai himself, who began with only a few thousand dollars. He grew the company and the brand: according to PC Magazine, the average user spends up to 54 minutes a day on the app – a figure that exceeds Facebook’s 42 minutes and Instagram’s 21 minutes.

According to leaked documents back in August, Grindr predicted pulling in about $38 million for 2015.

According to Financial Review, Carter McJunkin, chief operating officer of Grindr said in an interview: "We have users in every country in the world, but in order to get to the next phase of our business and grow faster, we needed a partner," McJunkin added that the relationship made sense for Grindr because of Beijing Kunlun's digital expertise, and because the company agreed to let Grindr's founders continue its operating structure and retain its current team.

Beijing Kulun saw Grindr as a good opportunity to expand beyond its core gaming focus, into more of an overall “lifestyle” brand. 

It’s interesting to note that Beijing Kunlun’s choice to purchase stake in a gay dating app seems incongruous, since homosexuality is still a taboo subject in China, and many gay people face widespread discrimination. It is not clear if Grindr intends to expand its business into the Chinese market, but there would be social stigma to overcome.

Beijing Kulun might see Grindr as a sound investment above all, despite its target market. Or perhaps they are paving the way for other Chinese investors to expand and reach out to invest in more diverse, successful brands outside of China. "We have been very impressed by Grindr's progress to date and are extremely excited about the future of the company," Yahui Zhou, chairman of Kunlun, said in a statement. "We will continue to seek out and invest in high-quality technology companies led by top-tier management across the globe.” For more information on this gay dating app you can check our our Grindr Topic.

Musicians Looking to Dating Apps to Promote Music

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Musicians are having to find new and more organic ways to promote their new albums, since people are discovering content in different ways outside of traditional radio. To capture new – and especially younger – fans, artists who are serious about promotion are now looking to dating apps, and finding some success.

Millennials are the largest group of consumers of music, and they also tend to be on dating apps like Tinder and Grindr. So it only makes sense that music and dating apps would eventually come together.

Some recent examples: Madonna's latest album was advertised on Grindr, a dating app for gay men, while Jason Derulo debuted a music video on Tinder. PlentyofFish was one of the first dating sites to link itself to an artist, by making an appearance in Derulo’s 2010 video for his song “Ridin Solo.” POF also worked with Lady Gaga during a U.S. tour, offering fans a chance to win tickets and backstage passes.

Other popular dating sites are linking to musicians, too - Mariah Carey premiered her music video for the single, "Infinity" via her new profile on Match.com, and DJ-producer Afrojack answered questions about love and relationships for eight hours on Match’s Twitter account to promote his new single.

The latest musician to take advantage of the wide reach of dating apps is Zedd, the Grammy-winning DJ-producer. He worked with Tinder to promote his album, "True Colors," released last month, by setting up his profile on the dating app. While Tinder users searched for dates, they would come across Zedd's promotional profile. They could swipe left or right, as with any other potential match. But instead of messaging him or setting up a date, if they swiped right, they could purchase his new album at a discounted price of $3.99 (compared to $7.99 on iTunes).

According to a recent story from Associated Press, “True Colors” debuted at No. 4 on the Billboard 200 albums chart its first week with 39,000 copies sold. While no specifics were given about how many sales were the direct result of Tinder users swiping right on Zedd’s profile, chances are the app had something to do with the album’s popular debut.

According to Tinder, eighty-five percent of its users are between the ages 18-34, and the average user spends about 11 minutes on the app each day — one of the main reasons artists are looking to work with Tinder in particular. It makes sense. Since users’ engagement with dating apps is pretty high, artists have their attention, at least for a few seconds, which is long enough to swipe right and learn more.

Are Dating Apps to Blame in the Rise of STDs?

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Popular dating apps like Tinder and Grindr have a reputation of being so-called "hook-up" apps. While more and more people are turning to dating apps to meet singles for long-term love and/ or a casual affair, this trend appears to coincide with a rise in the rates of syphilis and HIV, too.

Public health officials in Rhode Island released a health report last week stating that there has been a 79% rise in syphilis cases in the state between 2013 and 2014, and that it’s attributable in part to the use of social media and dating apps to arrange casual or anonymous hookups. People having unprotected sex, multiple sex partners, and having sex under the influence of drugs and alcohol were also cited as reasons for the increase in STDs.

“These new data underscore the importance of encouraging young people to begin talking to a doctor, nurse, or health educator about sexual health before becoming sexually active and especially after becoming sexually active,” Rosemary Reilly-Chamma of the Rhode Island Department of Education said in the report.

A rise in STDs, particularly HIV and syphilis, were also reported in New York, Utah, and Texas, where officials have warned of increased risk of transmission. The New York City Health Department announced earlier this year that men in the neighborhood of Chelsea had the highest infection rate of syphilis in the country.

Anindya Ghose, co-author of a study that monitored the rise of STDs along with the launch of Craiglist personals ads, believes that online dating apps have had a similar effect. "Basically what the Internet does is makes it a lot easier to find a casual partner," he told VICE News. "Without the Internet you'd have to put effort into casual relationships, chatting with someone at the bar or hanging out in places, but these platforms make it a lot more convenient and easy. That's essentially what the primary driver is."

Others disagree, citing a lack of education and resources, especially for young people, the largest group at risk. They argue that community health providers, doctors, and even schools should educate people about the risks of not using condoms and other protection when engaging in casual sex. Access to condoms and affordable healthcare are two big concerns.

Social media and dating apps make it easier to meet people, but they didn’t create the problem of STD risk. They magnified a problem that already existed – casual sexual encounters without adequate knowledge of safety and protection leave people vulnerable to risk.

Will Grindr Soon Be Up For Sale?

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Infamous hookup app Grindr may quietly be looking for a hookup of its own: a hookup with a buyer.

Word on the street is that the LA-based company has hired Raine Group LLC to advise on a possible sale. Bloomberg reports that “the sale process is early and no deal is assured,” so for the moment Grindr is keeping details under wraps.

Joel Simkhai founded Grindr in 2009 with $5,000. Since then, the explosively popular app has gained more than 5 million users in 192 countries. It claims to be the biggest male mobile social network in the world, and has become a bona fide pop culture phenomenon.

Oddly, despite its meteoric rise to the top of the gay dating app heap, Grindr remains self-funded with no outside investors. Revenue comes from a premium subscription service called Grindr Xtra, a paid upgrade that offers increased functionality and eliminates advertising for $12 per month.

In 2011 Simkhai launched Blendr, a dating app for both men and women that uses similar geolocation technology. So far it has yet to soar to the heights reached by its predecessor.

The problems Grindr and Blendr currently face are not unique. The dating industry is massive and cutthroat. Research by IBISWorld found 3,924 dating services in the US alone, which add up to revenue of about $2 billion. Competition is in ample supply, and it isn't easy for paid services to go head-to-head with free options.

The business model itself offers a special set of challenges. Dating services struggle to retain customers and sustain revenue growth for an amusingly obvious reason: because ideal use of the service means no more need of it. A success story ends in finding love, settling down, and never needing to date again.

A short-term solution to the problem, at least for Simkhai himself, is a sale. IAC (InterActiveCorp) could perhaps be a likely buyer, as it controls the majority of the online dating market in America through ownership in platforms like Tinder, OKCupid, and Match.com. Grindr would be a powerful addition to IAC's already-powerful lineup.

It is not known how – or even if – a sale would impact users, but it's probably safe to assume drastic changes aren't on the way for an app that's already had so much success. Although with more money and muscle behind it, who knows how much growth could be in store for Grindr?

Is Online Dating Killing Your Anonymity?

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The great thing about online dating (well, one of many) is that it can connect people from almost anywhere in the world. The not-so-great thing is that, eventually, one of those people is bound to be someone you wish it wasn't.

A big city seems surprisingly small when swiping leads you to an ex, or a co-worker, or – squick – a sibling. As soon as that familiar face pops up on your screen, the buffer of anonymity you thought you had shrivels up and expires.

Once upon a time, part of the appeal of online dating was the privacy factor. It felt safe. Looking at photos and a profile kept you one step removed from the real human on the other side, making vulnerability easier and rejection less painful.

Now, with more and more people turning to dating sites and apps, you're increasingly likely to run into someone you recognize. Or worse, someone who recognizes you. Kiss that safety net goodbye.

Some dating services are taking steps to ease the awkwardness. Grindr allows users to set geographical constraints and block other users. On JSwipe, users can turn off the ability to be seen by or match with Facebook friends. On Tinder, a simple swipe left means that person will never appear on your feed again.

OkCupid has plans to take things a step further, with new features set to roll out in the upcoming months. One will allow a user to hide their profile from all users by default. It will only be seen by people they actively “Like” or send a message to. The other feature adds the option of connecting a Facebook account, so all Facebook friends are immediately blocked on OkCupid.

While some are fiercely protective of their privacy, others are taking the opposite stance. A handful of Tinder users told The Daily Beast they swipe right on familiar faces as a friendly hello or a way to reconnect platonically with old acquaintances. Some even admitted to using dating apps and sites to keep tabs on exes. Just imagine the trouble location-based apps could get you into under those circumstances.

If the question is “Is online dating – and social media in general – bringing an end to anonymity?” the answer has to be yes. But if the question is “Does it matter?” the answer becomes more complex.

There's no doubt safety is important. Certain info doesn't belong online because it puts you at risk. But beyond that, what's the issue? Insecurity? Vulnerability?

The world will be a better place when we don't feel insecure or ashamed about wanting a relationship, and seeing as vulnerability is key to any strong romantic foundation, perhaps it isn't something to be feared after all.

World Cup Fans Go Crazy for Dating Apps

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Brazil is heating up for singles, and not just because of its sunny weather.

Dating app Tinder is apparently a hot commodity among those taking part in the World Cup festivities. News site Quartz recently reported that Tinder has seen a 50% increase in downloads since the World Cup began last month.

Brazil is Tinder’s third-largest user base behind the US and the UK, and the app is available in Portuguese.

Hookup apps like Tinder and Grindr, which are popular around the world, allow users to swipe through pictures of potential matches that are geographically close to them, accepting or rejecting based on a few photos and a brief profile description. If two people select one another, they can start chatting and then take it from there. This simple process caters perfectly to short-time travelers looking for a fling.

First, we saw Tinder downloads spike during the Olympics, especially in Olympic Village where the athletes mingle with fellow athletes, fans watching the games or employees working the events. Now with the World Cup festivities drawing fans from all over the world to watch and celebrate the games, we’re seeing another significant spike in dating app downloads.

It seems dating apps are becoming more popular at major events that draw huge crowds. Tinder has become a popular tool for singles traveling during the summer to meet up with other singles, so it only makes sense that events like the World Cup would attract a lot of new users. Why not try something new when you’re in a foreign city with tons of people all around that you could meet?

The numbers also seem to favor women, especially local Brazilian women. Many men have come to Brazil not only to watch the World Cup, but to meet the stereotypical idea of the sexy, beautiful Brazilian woman. An unofficial poll suggested as many as 90% of the tourists are men.

Grindr, a popular app among the gay community, has also seen its numbers spike by 31% in Brazil since the World Cup began. Brazil is the sixth-largest market for Grindr.

An estimated 600,000 tourists from 186 countries are expected to visit Brazil during the World Cup, adding to the 3.1 million Brazilians who will be on the road for the championship. And as reported by Quartz, alcohol and hook-ups go hand in hand. Annual beer sales in the country are likely to rise 37%—bringing in about $816 million—during the month-long tournament.

For more on a popular dating app you can read our Tinder review.