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The $3.5 Billion Love Industry: How Tinder & Bumble Monetized Hope · Social Proof Podcast

• 0:00
  [SPEAKER_00]: All right, family, listen, we've got to get some good.
• 0:03
  [SPEAKER_00]: Listen, before it's tender, before bumble, before swiping left and right, people still have the same problem.
• 0:10
  [SPEAKER_00]: How do I find somebody?
• 0:12
  [SPEAKER_00]: right and at first it was family's arranging marriages then it was like professional matchmakers who made their living introducing people and whether they got paid in cash or gifts or even reputation or status matchmaking has always been a business so this isn't just a story about love this is a story about money
• 0:36
  [SPEAKER_00]: about how every era found a way to monetize human connection.
• 0:41
  [SPEAKER_00]: And as entrepreneurs, there's a lot we can learn from this.
• 0:44
  [SPEAKER_00]: So let's get into it.
• 0:46
  [SPEAKER_00]: Precentries, the business of dating was really, it wasn't really dating at all.
• 0:53
  [SPEAKER_00]: marriage arrangements.
• 0:55
  [SPEAKER_00]: So, like in a Jewish community, for instance, you got a chatch in, I think it's called a chatch in, right?
• 1:02
  [SPEAKER_00]: It was like a professional matchmaker who they were compensated when the union was successful, so if you get married, then you'd be paid to go.
• 1:10
  [SPEAKER_00]: In India, families relied on intermediaries, or by community leaders, or elders, who receive gifts or payments for arranging marriages.
• 1:19
  [SPEAKER_00]: But even in medieval Europe times, the priests or nobles, they played the matchmaker, right?
• 1:26
  [SPEAKER_00]: But it wasn't for love or romance.
• 1:28
  [SPEAKER_00]: It was for alliances, property, families coming together for legacy.
• 1:34
  [SPEAKER_00]: Now the point is, matchmaking has always made a fee structure.
• 1:38
  [SPEAKER_00]: Somebody got something for making a connection.
• 1:41
  [SPEAKER_00]: That's what happened.
• 1:42
  [SPEAKER_00]: Always, these apps that we're on right now get an invent this model.
• 1:47
  [SPEAKER_00]: But there's a model change.
• 1:49
  [SPEAKER_00]: So what I'm talking about, that's the earliest form of dating of the dating business, right?
• 1:54
  [SPEAKER_00]: It's changed, right?
• 1:55
  [SPEAKER_00]: But as the world modernized, people move the way from small villages and away from their family structures and move them to cities in that created new problem.
• 2:06
  [SPEAKER_00]: People were now free to choose for themselves whoever they wanted, but they didn't know how to find each other.
• 2:13
  [SPEAKER_00]: And people had a problem solvers, look for problems,
• 2:18
  [SPEAKER_00]: So now comes in personal ads in video dating.
• 2:23
  [SPEAKER_00]: So like by the mid-1900s, newspapers spotted that opportunity.
• 2:28
  [SPEAKER_00]: So they created what was called like lonely hearts, the lonely heart section where singles would take out personal ads.
• 2:36
  [SPEAKER_00]: This wasn't free.
• 2:38
  [SPEAKER_00]: It was small, right?
• 2:39
  [SPEAKER_00]: 20 were, it might cause you five to $1,000.
• 2:41
  [SPEAKER_00]: A large one would correct you like 20 bucks or more, which adjusting for today's money, that was a serious investment, just to get noticed.
• 2:50
  [SPEAKER_00]: But people paid it because visibility
• 2:53
  [SPEAKER_00]: was and has always been valuable, so these ads worked though.
• 2:59
  [SPEAKER_00]: People met, so I'm even not married, I mean it was awkward, some time for sure, but it proved that it proved something critical.
• 3:07
  [SPEAKER_00]: People will pay to increase their chances of finding a love.
• 3:12
  [SPEAKER_00]: It's never stopped, so like by the 1980s technology added another layer of video dating.
• 3:19
  [SPEAKER_02]: If you're like me, meeting new single people who are incompatible isn't easy to do, single-spirited people at work aren't the answer.
• 3:25
  [SPEAKER_02]: So I call it Matt's Maker International.
• 3:27
  [SPEAKER_02]: The personal introduction service.
• 3:29
  [SPEAKER_01]: If you're single, but just too busy to meet other singles, aren't a forest and don't know how to begin dating again.
• 3:35
  [SPEAKER_01]: or you just haven't found someone special to share your life with.
• 3:38
  [SPEAKER_01]: Well, great expectations can make it happen.
• 3:41
  [SPEAKER_01]: We're an exclusive video dating service where you can meet new people.
• 3:45
  [SPEAKER_01]: People you might not ordinarily need to share your interest and values.
• 3:50
  [SPEAKER_00]: So now instead of words on paper, like the newspaper, you could record yourself saying who you were and what you wanted.
• 3:58
  [SPEAKER_00]: Right?
• 3:59
  [SPEAKER_00]: You get all dialed up, you get dressed up, you look into a little camera, however you record the video of who you are, what you're looking for.
• 4:06
  [SPEAKER_03]: I don't know, the type of girl that I'm looking for is one that's really attractive to me.
• 4:12
  [SPEAKER_03]: I like an attractive woman, someone who might look like Christy Brinkley or Jacqueline Smith.
• 4:16
  [SPEAKER_00]: Some people call me sexy, others say I'm sensuous.
• 4:21
  [SPEAKER_00]: You go into a studio, record a tape, and you pay $20, $30 for that privilege, then other people would come in, pay a fee, and watch the tapes, like they were browsing a library of singles, like a YouTube singles library, specifically for that purpose.
• 4:39
  [SPEAKER_00]: If they like you, they could pay again to send it response.
• 4:43
  [SPEAKER_00]: She's this isn't an age, y'all.
• 4:46
  [SPEAKER_00]: Some people love that they thought, like, finally, I could hear a real voice.
• 4:50
  [SPEAKER_00]: I could see a real smile, because remember, they're coming from the newspaper, and you don't know what this person's on, right?
• 4:56
  [SPEAKER_00]: You don't know they vibe?
• 4:58
  [SPEAKER_00]: Other people obviously thought it was embarrassing getting on video to talk about who you are, but you wanted it, right?
• 5:03
  [SPEAKER_00]: So who wants to be caught on video looking nervous under like fluorescent lights?
• 5:09
  [SPEAKER_00]: But enough people did it, enough people paid that it became a real business and the people who put that model together started making money here's the key transition video dating
• 5:20
  [SPEAKER_00]: was clunky, and it was expensive, and very, very difficult to scale.
• 5:24
  [SPEAKER_00]: So when the internet arrived, it solved those problems almost overnight.
• 5:30
  [SPEAKER_00]: So then we got to go to the behemoth, almost like considered the grandmother, grandfather of dating, which is match.com, oh my gosh.
• 5:45
  [SPEAKER_00]: At this time, internet is just gonna start it.
• 5:48
  [SPEAKER_00]: In that year, match.com launches as one of the very first online dating websites, right?
• 5:55
  [SPEAKER_00]: So the business model was simple, subscription for about 20 bucks a month, you could browse profile, see unlimited messages and connect with people far beyond your neighborhood.
• 6:08
  [SPEAKER_00]: So remember, the newspaper has the video that was all local stuff that couldn't scale.
• 6:13
  [SPEAKER_00]: So at this point, this revolutionary, no waiting for letters, no expensive video tapes, just instant access to thousands of people without geographical boundaries.
• 6:25
  [SPEAKER_00]: So the need they were solving was very clear, scale.
• 6:32
  [SPEAKER_00]: Personal ads only reach people who reach a local paper.
• 6:36
  [SPEAKER_00]: Video dating was limited because you had to actually show up.
• 6:40
  [SPEAKER_00]: at the studio, but online suddenly you can meet people across the country, even across the world, right?
• 6:49
  [SPEAKER_00]: And of course, competition starts to show up fast.
• 6:52
  [SPEAKER_00]: Dozens of like niche sites start popping up so you got Christian dating, senior dating, ethnic dating.
• 7:00
  [SPEAKER_00]: Most of them stayed small though, but match.com had the money, had the marketing, and early movers of the image.
• 7:08
  [SPEAKER_00]: But here's where it gets interesting.
• 7:10
  [SPEAKER_00]: So the founder of Mass.com, Gary Criman, also registered one of the most valuable domains in history.
• 7:19
  [SPEAKER_00]: Sex.com.
• 7:23
  [SPEAKER_00]: Bob, man, wait a guy, sex.
• 7:24
  [SPEAKER_00]: You have to know the time frame.
• 7:26
  [SPEAKER_00]: It ain't just coming out when you just get sex.com.
• 7:29
  [SPEAKER_00]: And in the 90s, that domain was actually stolen from them.
• 7:33
  [SPEAKER_00]: And one of the biggest fraud scandals in the internet history.
• 7:36
  [SPEAKER_00]: So guy fought in court for years to get it back.
• 7:40
  [SPEAKER_00]: And eventually one, tens of millions and damages, but the scandals showed how high the stakes were.
• 7:47
  [SPEAKER_00]: Even the name of the website could be worth a fortune.
• 7:50
  [SPEAKER_00]: Keep a lead at mewowmas.com, just kept on growing.
• 7:54
  [SPEAKER_00]: And spite of the sex.com scandal thing, right?
• 7:57
  [SPEAKER_00]: But they just kept on growing.
• 7:59
  [SPEAKER_00]: And instead of just fighting competition,
• 8:02
  [SPEAKER_00]: They started buying them.
• 8:04
  [SPEAKER_00]: They kept acquiring all these smaller dating sites.
• 8:07
  [SPEAKER_00]: They started merging the user bases and consolidated the industry.
• 8:12
  [SPEAKER_00]: So over time, match a group was born, which is a parent company that now owns okay-cupid, plenty of fish, hinge, and a antender, actually.
• 8:24
  [SPEAKER_00]: Match group owned all the stuff.
• 8:26
  [SPEAKER_00]: So what's the lesson?
• 8:27
  [SPEAKER_00]: They didn't just build one dating app.
• 8:29
  [SPEAKER_00]: They built the empire and they did it by understanding that different people want different kinds of connections, whether it's casual, serious, niche, and instead of trying to be everything to everyone, they bought the whole ecosystem, goodness gracious.
• 8:47
  [SPEAKER_00]: So here we are, by the early 2010s, the smartphone actually changed everything.
• 8:53
  [SPEAKER_00]: People weren't just logging onto it, I don't know anymore.
• 8:56
  [SPEAKER_00]: They were living on it.
• 8:57
  [SPEAKER_00]: I mean, carrying it in their pockets, my phone is never too far from me today, and that's when Tender entered the scene in 2012, right?
• 9:07
  [SPEAKER_00]: So you already know match dot com, but this before Tender, so I'm kind of like, going back now, Tender did something radical.
• 9:16
  [SPEAKER_00]: Instead of long questionnaires, endless compatibility scores or detail bios,
• 9:26
  [SPEAKER_00]: So I left their swipe right?
• 9:27
  [SPEAKER_00]: That small motion was so addictive.
• 9:30
  [SPEAKER_00]: It turned dating into a game, and people couldn't stop playing.
• 9:34
  [SPEAKER_00]: So within two years, Tender was processing over a billion swipes a day.
• 9:41
  [SPEAKER_00]: Now here's where the money comes in.
• 9:44
  [SPEAKER_00]: The app was free to download, free to swipe.
• 9:47
  [SPEAKER_00]: But if you wanted an edge, you had to pay.
• 9:50
  [SPEAKER_00]: Well, it was that look like.
• 9:52
  [SPEAKER_00]: You wanna see who already likes you, but that's Tinder gold.
• 9:55
  [SPEAKER_00]: We gotta pay for that.
• 9:56
  [SPEAKER_00]: You want unlimited swipes?
• 9:58
  [SPEAKER_00]: That's premium.
• 10:00
  [SPEAKER_00]: That's a premium upgrade because at that time, you could only swipe and actually, fun fact, I met my wife once in there.
• 10:07
  [SPEAKER_00]: But when I had it as a free at, you can all use a few swipes and you use up them swipes, you gotta just jump one tomorrow, now it's too cheap to pay, but there was some people that would pay for that gaming experience.
• 10:19
  [SPEAKER_00]: You wanna rise to the top of the pile for 30 minutes, you can boost your profile, you gotta pay for it.
• 10:27
  [SPEAKER_00]: That wasn't, this isn't just dating.
• 10:29
  [SPEAKER_00]: It's monetizing in patients and visibility.
• 10:34
  [SPEAKER_00]: people didn't want to wait.
• 10:36
  [SPEAKER_00]: They didn't want to just get lost in the crowd.
• 10:39
  [SPEAKER_00]: They want to pay to stand out so you could pay to stand out.
• 10:43
  [SPEAKER_00]: You could pay to make sure you can see as many people as possible.
• 10:46
  [SPEAKER_00]: You could pay to put yourself in more people's algorithm because it increases the chance that you get seen and it worked.
• 10:53
  [SPEAKER_00]: Tinder became one of the highest grossing apps in the world.
• 10:57
  [SPEAKER_00]: across all categories, not just dating.
• 10:59
  [SPEAKER_00]: By 2023, Tender Alone was making over $2 billion a year.
• 11:05
  [SPEAKER_00]: But Tender wasn't alone.
• 11:07
  [SPEAKER_00]: So, by 2014, Whitney Wuff heard, which is the co-founder of Tender, split from the company after a very public and messy conflict with the leadership, added at drama, she launched Bumble.
• 11:23
  [SPEAKER_00]: The story just better and better.
• 11:25
  [SPEAKER_00]: Bumble's big twist, right?
• 11:27
  [SPEAKER_00]: Women had to message first that one rule set it apart in a crowded marketplace.
• 11:34
  [SPEAKER_00]: Because at this time, they're popping up now, right?
• 11:36
  [SPEAKER_00]: You see the success of one thing, these things pop up.
• 11:39
  [SPEAKER_00]: One of the co-founders of Tinder spends off to do bumble bumble women, you have to initiate bumble grew so fast.
• 11:47
  [SPEAKER_00]: It went public in 2021 and that his peak was valued
• 11:57
  [SPEAKER_00]: Meanwhile, other apps found her niche.
• 12:00
  [SPEAKER_00]: I mean, hinge branded itself as designed to be deleted.
• 12:06
  [SPEAKER_00]: Marketing is crazy.
• 12:08
  [SPEAKER_00]: Promising more serious connections, they're saying designed to be deleted.
• 12:12
  [SPEAKER_00]: This app was designed for to use it, find love, and then delete us.
• 12:16
  [SPEAKER_00]: By 2024, it had over 30 million users.
• 12:21
  [SPEAKER_00]: What about coffee, me's bagel?
• 12:22
  [SPEAKER_00]: Limited swipes to encourage quality over quantity.
• 12:26
  [SPEAKER_00]: niche apps popped up everywhere from Christian Mingle to farmers only, but the growth came problems.
• 12:36
  [SPEAKER_00]: You got these data breaches, bot scams, and user fatigue, of course.
• 12:41
  [SPEAKER_00]: So some apps died out.
• 12:43
  [SPEAKER_00]: Others got absorbed into larger companies, like the match group.
• 12:47
  [SPEAKER_00]: They started buying everything up.
• 12:49
  [SPEAKER_00]: Still, the message was clear on mobile dating wasn't just an industry.
• 12:54
  [SPEAKER_00]: It was in an economy, it was its own economy.
• 12:58
  [SPEAKER_00]: So today, online dating is a multi-billion-dollar global business.
• 13:05
  [SPEAKER_00]: The match group, which is the parent company that owns tender and match and okay, cute bit like we talked about plenty of fish, actually owns hinge, made 3.5 billion in revenue in 2024.
• 13:20
  [SPEAKER_00]: Bumble, even after his valuation crash, still pulls in hundreds of millions of dollars every single year, thousands of apps exist worldwide, but it's not all wins.
• 13:31
  [SPEAKER_00]: There are cautionary tales too.
• 13:33
  [SPEAKER_00]: I mean, remember I was telling about coffee meets bagel, coffee meets bagel suffered a data breach that exposed over six million users.
• 13:43
  [SPEAKER_00]: smaller apps collapse under the weight of like the fake profiles and you've got all these bots.
• 13:48
  [SPEAKER_00]: It's seen that stock crash more than 90% from its peak and there's a bigger darker criticism.
• 13:55
  [SPEAKER_00]: Dating apps may not want you to actually find love.
• 14:01
  [SPEAKER_00]: Think about it.
• 14:02
  [SPEAKER_00]: If they match you too well, you leave.
• 14:05
  [SPEAKER_00]: But if they keep you swiping, they keep you paying.
• 14:08
  [SPEAKER_00]: Well, that tension's created real distrust amongst the users of these apps.
• 14:14
  [SPEAKER_00]: So people are less and less trusting of the apps.
• 14:17
  [SPEAKER_00]: Despite that, the demand wasn't going away.
• 14:20
  [SPEAKER_00]: Because at the end of the day, people are still willing to pay for visibility, pay for speed, and they're more importantly willing to pay for hope.
• 14:30
  [SPEAKER_00]: but what's the entrepreneur's lesson in all this?
• 14:33
  [SPEAKER_00]: Here's the big takeaway as you an entrepreneur are building something special.
• 14:40
  [SPEAKER_00]: From village matchmakers to personal ads to video dating to match.com, to tender, and bumble every era of dating has proven the same truth.
• 14:50
  [SPEAKER_00]: People will always pay to shorten the distance between where they are and where they want to be every time.
• 14:58
  [SPEAKER_00]: for love, they pay billions.
• 15:01
  [SPEAKER_00]: So ask yourself, what's the lonely hearts adding your industry?
• 15:05
  [SPEAKER_00]: What's the problem?
• 15:06
  [SPEAKER_00]: So deep, so human, that people are gladly open or wallets if you can solve it faster, better, and easier.
• 15:15
  [SPEAKER_00]: Technology changes, y'all.
• 15:17
  [SPEAKER_00]: Business models change, apps rise and fall, but the entrepreneur who can identify the timeless problem and build a bridge never goes out of style.
• 15:29
  [SPEAKER_00]: Because if people are willing to pay, people are willing to spend billions.
• 15:33
  [SPEAKER_00]: Just for the chance it love, imagine what they'll pay you when you solve the problem that keeps them up at night.
• 15:41
  [SPEAKER_00]: Ya, just keep on building.
• 15:43
  [SPEAKER_00]: Keep on building.
• 15:44
  [SPEAKER_00]: You're building something special.
• 15:46
  [SPEAKER_00]: Hopefully, this video takes our mind from, I'm just trying to do something to make some money.
• 15:53
  [SPEAKER_00]: So I'm going to change an industry.
• 15:55
  [SPEAKER_00]: I'm going to solve a real problem that people want to pay for.
• 15:58
  [SPEAKER_00]: I'll see you all next episode.