(BMBL) begins buying and selling on Nasdaq
The shares of Bumble, which operates the dating app of the same name, rose sharply when it went public on Thursday on the Nasdaq.
The company’s stock rose nearly 77% to $ 76 per share under the ticker symbol “BMBL”. The price of shares was $ 43 each, above the target range of $ 37-39. In addition, 50 million shares were sold.
After its debut, Bumble’s market cap was $ 8.3 billion.
At Bumble, founded in 2014 by current CEO Whitney Wolfe Herd, women must initiate the first conversation for straight games. At the age of 31, Wolfe Herd is the youngest female founder to have a US company listed on the stock exchange. She is also on an extremely small list of female founders who led initial public offerings, including Stitch Fix’s Katrina Lake, who floated her company in 2017, and Julia Wainwright, who floated The RealReal in 2019.
Bumble has a “freemium model” which means users can join and match for free. Most of the revenue comes from in-app purchases and various subscription offers like Bumble Boost (starting at $ 12.99 per week) and Bumble Premium (starting at $ 17.99 per week).
With the paid offers, users can, for example, make their profile better known, see who liked their profile first, or put themselves into travel mode. It’s a similar model to the competing apps Hinge and Tinder, where users can use the core features for free but pay to continue using them. For example, Hinge’s “preferred” membership is priced at $ 19.99 per month. Bumble also makes little money from advertising and partnerships.
The company said it had 12.3 million monthly active users as of September 30th. Speaking to CNBC ahead of the company’s first trade, Wolfe Herd said the company was focusing its efforts on moving more of its user base to these paid users by monetizing it in future features and product offerings.
Bumble stated in its S-1 filing that it had sales of $ 376.6 million for the first nine months of 2020, with a net loss of $ 84.1 million. For the same period in 2019, Bumble had sales of $ 362.6 million and net income of $ 68.6 million.
Bumble’s main competitor is Match Group, which owns Hinge, Tinder, and several other dating competitors and has a market cap of $ 45.5 billion.
Bumble recognized its competition but stated in its prospectus that online dating “is not a” winner-take-all “market”. The company said most people have an average of two different dating apps on their phones.
Goldman Sachs, Citigroup, Morgan Stanley and JP Morgan led the offer.
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