Earlier this week, Grindr LLC, the world’s largest dating app for the LGBTQ+ community, announced that it has agreed to go public through a merger with a blank-check acquisition firm. “Grindr is well-positioned to be a public company and will continue to expand the ways it serves the LGBTQ+ community,” Grindr’s CEO, Jeff Bonforte, said in a statement. The app is merging with Tiga Acquisition Corp. (NYSE: TINV), a Singapore-based special purpose acquisition company (SPAC), which debuted in late 2020. Under the business deal, Grindr will receive an estimated $384 million – $284 million in cash and up to $100 million in a forward purchase agreement. “From our perspective, we’re ready to be a public company,” CFO Gary Hsueh said in an interview, before adding that going the SPAC route “made more sense because it had certainty and that’s even more important today than it was a year ago when the market was different.” Tiga shares rose by 1.27% to $10.38 in after-trading hours Monday.
The Hollywood-based dating app has had many owners over the years. Just two years ago, the Chinese firm Beijing Kunlun Tech Co. sold Grindr for $620 million after the Committee on Foreign Investment in the United States (CFIUS) shared national security concerns – that the personal data of US users could be accessed or exploited by China’s government. The current SPAC deal with Grindr is expected to be finalized by the end of 2022, subject to regulatory and stockholder approval.
Even though other apps, such as Tinder, are LGBTQ+ friendly, Grindr is, undeniably, the most popular dating app within the community; by the end of 2021, there were (a) 11 million monthly active users, 80 percent of whom were under 35, (b) 723k paying users, up by 31 percent compared to 2020, and (c) average daily time spent on the app per user was 61 minutes. Similar to the app’s impressive numbers of its user base, Grindr’s profits in 2021 also demonstrated remarkable growth, with non-GAAP revenue increasing by 30 percent year-over-year to $147 million. Likewise, adjusted earnings before interest, tax, depreciation, and amortization came at $77 million, a 51 percent increase year-over-year. Following last year’s successful earnings, Grindr estimates its revenue in 2022 to increase 35%-40% compared to 2021.
All things considered, one thing is for sure; the tech scene is slowly evolving, and investors are more willing to become gradually more diverse and dive into new waters, by giving the less “mainstream” start-ups a chance to flourish.
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