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Blackstone buys Bumble and Badoo dating apps

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Via Financial Times

Blackstone has agreed to buy a majority stake in the owner of Bumble, in a deal that values the dating app at about $3bn and highlights the private equity group’s push into tech start-ups.

MagicLab, which also runs the dating app Badoo, will be run by Bumble’s founder and chief executive Whitney Wolfe Herde under the deal. MagicLab’s founder Andrey Andreev will sell his stake and step down from the company.

The company will “keep working towards our goal of recalibrating gender norms and empowering people to connect globally,” Ms Herd said in a statement. MagicLab also runs Lumen, a dating app for over-50s, and Chappy, a gay dating app.

Bumble has 75 million users and Badoo has 450 million, a MagicLab spokesperson said. The company told the Wall Street Journal in July that its annual revenue run rate — an estimate based on current financial performance — is just under $500 million.

The deal is the latest move by New York-based Blackstone as it pushes deeper into tech start-ups. Former General Atlantic executive Jon Korngold joined the firm in January to start a new growth equity business, which takes minority and majority stakes in private companies traditionally too small for private equity.

Blackstone is in talks to raise $3bn to $4bn for the inaugural growth equity fund, two people familiar with the discussions said, with the aim of writing cheques in the hundreds of millions of dollars.

The MagicLab deal “is a perfect example of Blackstone’s ability to use its scale, long-term investment horizon, and deep bench of operational resources” to grow entrepreneur-led companies, Mr Korngold said.

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Ms Herd founded Bumble, which attracts users with its feminist credentials since women must make the first move on the app, after she left the rival dating app Tinder. It aims to be a “kinder internet,” the company has previously said.

Badoo found itself in a #MeToo scandal this year when Forbes reported allegations of a toxic environment for women at its London headquarters. Employees said internal engineering updates were named after porn stars and a sexually explicit video involving an employee was widely circulated, according to the report.

Mr Andreev said at the time he was “shocked and saddened” by the allegations and had hired an external human resources group to conduct an investigation.

Bumble had been rumoured as an acquisition target for Match Group, owner of the dating apps OkCupid and Tinder. Facebook also moved into the crowded online dating space with a US launch in September.

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