Will You Swipe Right on Dating Apps as a Portfolio Investment - KingsCrowd

April 5, 2018

Will You Swipe Right on Dating Apps as a Portfolio Investment

The dating game has long been considered taboo, but in recent years millennials and Gen-z’ers have pushed it into the mainstream. In many ways dating is going through a tech renaissance where humans are reimagining interpersonal relationship formation. It’s also become a multibillion dollar market where the opportunity for creating unique and customized dating alternatives is constantly beckoning. IceBrkr and Perchance are two such dating apps looking to do just that. Both also happen to be raising equity crowdfunding rounds that allow non-accredited investors to get in on the dating game. Currently, you can find IceBrkr on NetCapital or Perchance on WeFunder. Learn more below. Understanding the Dating Game: It’s incredible to think that just one generation ago, people dated by getting to know one another through a friend or shared experience. Oh the days of traditional dating, how quickly they have escaped us. For better or for worse millennials, GenZ-er’s and beyond are reinventing the dating game to better reflect their overall frictionless lifestyles. And thus, millions of young (and even old) singles Match, Bumble, Grindr, Hitch, Harmonize, OK, Blued, and Tinder there way to dates and relationships on a daily basis. But the real winners may not be the dates, but rather the companies that are finding ways to monetize a world of singles increasingly leaning on the crutches of technology to manage their dating lives. And in return for providing relationship-made-in-heaven algorithms, users are giving back by opening up their wallets for love. For instance, Bumble produced over $100 million in in-app purchases last year to help users cut down on the number of swipe rights and lefts it takes to find the “one.” With a real business model in place, and enough singles swiping right for Bumble, the organization has recently fetched a $1 billion valuation. You read it right, Bumble the dating app is a startup unicorn. To be clear, Bumble isn’t the only one getting all the love. Tinder, for instance got Match Group salivating for its 50 million “singles,” which led to its acquisition at a $3 billion dollar valuation in August of 2017. Match Group itself is currently valued at over $8 billion, and Blued, and Grindr, which both provide dating apps focused on the gay community fetched a $300 million and $155 million valuation respectively during their last raises. Though not all VCs have jumped at the lumpiness that can come with dating app users, it is hard to deny that there has been a lot of success in this space to date. And as we move forward you could imagine we will continue to see startups entering the space looking to provide more tailored dating services to continue to optimize the dating experience for increasingly picky millennials and Gen-zer’s. And that’s where IceBrkr and Perchance come into play. IceBrkr: The AI Empowered Wingman IceBrkr is a dating app focused on cultivating a culture of online daters that want and are willing to take online dating seriously. In order to build this culture, IceBrkr is turning to AI technology in hopes of building an “Emotional Intelligence Enhancer” chatbot that will provide tailored tips and education. The chatbot can help you create a profile that tells your story well, assist you in learning to communicate with potential dates, provide custom matches and even helps you pick the right place for that hot date! Co-Founder Kevin Murray, decided to pursue this endeavor because he felt the dating app landscape is a mess with, “most apps being focused on gamifying the dating experience rather than helping to foster better communication.” It’s not surprising that Kevin Murray and Mark Brehaut, Co-Founders of IceBrkr set out to professionalize the dating game. Both received Masters from Rutgers University where Kevin, researched online dating, and Mark received his Masters in Marriage & Family Therapy. Kevin even went on to work as a professional matchmaker at EFlirt, where customers paid upwards of $4K for dating assistance. Kevin realized during his time at EFlirt that there was a real opportunity to, “take the level of service found at boutique shops like EFlirt that support the ultra-rich, and provide it to the masses by utilizing scalable AI technology.” Current dating app offerings focus on extreme ends of the dating spectrum from ultra-casual apps like Bumble to serious relationships for older individuals like eHarmony. The need to fill in the gap is real, and that is the problem IceBrkr is well positioned to fix. As a reminder, IceBrkr is pre-product, but the vision for monetization is there. Perhaps the most intriguing opportunity for revenue that the team is currently testing is producing in-app restaurant selections and discounts through restaurant partnerships that will pay out to the app. Adding a B2B marketing strategy on top of the $20/month subscription service could provide some strong revenue opportunities down the road. At a $1M valuation, investors have an opportunity to get in at a low valuation and back a team that understands the market needs not currently being met by dating app offerings. Perchance: Turn the one that got away into the one Perchance is a unique dating app offering because the founding team of David Gottesmann, Josh Baker, and Eduardo Assola are banking on people wanting to put an end to “What if.” What do they mean by that? Well, have you ever walked through the train station on your morning commute and spotted the one that catches your eye, or started a conversation on line while waiting for concert tickets only to be cut short in conversation with no phone number or name to go off of? Perchance wants to provide a solution for those moments by enabling you to reconnect with people you may have had a moment with utilizing geo-location technology that allows them to identify other perchance users that were within your vicinity at a single point in time. With a marketing plan that involves ads in high traffic locations like subways, interactive launch parties, and a surprisingly cool brand, Perchance may have just found its niche within the dating app community. If you can get behind the idea that 20% of the 114 million singles in the US might want to chase the one that got away, that leave Perchance with 5.7 million singles to chase. How do they plan to monetize this unique reconnection love tool? The Perchance team plans to offer a freemium model that allows users to unlock features like personalized suggestions. They also plan to set up ad revenue generated from local businesses and larger partnerships, as well as through sponsorships with retailers looking to tap into their understanding of local audiences thanks to their tracking technology. At a $4 million dollar valuations and plans to roll out in Miami to start, this is a unique opportunity to test the waters on a dating app that truly has no competitors, but may struggle if it can’t find early traction. To invest or not to invest: Both dating apps offer intriguing alternatives to the current offerings on the market. And though the dating app world is rather saturated, users have low loyalty to the brands they use and are always open to trying something new. This may leave the door open to new offerings that can meet the evolving needs of customers. And frankly both IceBrkr and Perchance are terrific examples of companies pushing the boundaries of technologies to see whether or not singles are willing to adopt the latest technology to transform their love life. Think about it, IceBrkr is about using AI to improve communication and engagement, while Perchance is about using geo-location technology to recreate missed connections. Being on the frontier of innovation just might provide the leg up these companies need to succeed. Will you invest in love?


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About: Chris Lustrino

A Boston College Eagle for life, on a mission to democratize startup investing for all people at KingsCrowd, with a passion for Fintech, investing, social impact, doing well and doing good, and an avid runner, cyclist and writer.

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