Online dating companies hope markets feel the love
Media mogul Barry Diller is planning an IPO with the websites in his Match Group, which includes Match, Tinder, OkCupid and OurTime. While CBS News financial contributor Mellody Hobson said online dating is now "mainstream," she was shocked by the company's worth.
"I mean these numbers, I have to say, they blew me away. I had no idea this business was this valuable," Hobson said Friday on "CBS This Morning."
Match Group, with its 4 million paid subscribers, is worth about $5 billion.
"They're going to make $900 million in revenues this year. Approximately just shy of $300 million will be profit," she said.
According to Hobson, dating sites in the U.S. are expected to bring in $1.17 billion in 2015. Dating apps alone could bring in $628.8 million. That's an increase from $1.08 billion and $572 million, respectively.
One reason the company is planning to go public now, Hobson said, is because "the market is red hot."
"We're at all-time high," she said.
The pool of online dating users is also continuing to grow.
The Pew Research Center found that 1 in 5 adults between 25 and 34 years old has used online dating and it's hugely popular with older singles too. A dater aged 45 to 54 is just as likely to date online as someone aged 18 to 34.
One of their hottest brands is Tinder, an app popular with younger users that Hobson said is "growing by leaps and bounds."
"Tinder supposedly, the company will not confirm this, has 50 million monthly users but only 300,000 monthly subscriber," Hobson said.
Following the IPO, Hobson expects Match Group to focus heavily on Tinder and other mobile apps.
But Match Group isn't alone. Hobson said there are 500 different dating apps available on the Apple App store.
"I think the competition will continue to heat up," Hobson said. "You'll probably see competitors also think about going public."