Dating app Tinder isn't a $5 billion company
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Tinder, the explosively popular dating app, is now worth $5 billion, reports Bloomberg. Created just 20 months ago, the app syncs with your Facebook profile to scan your area for potential romantic partners. It now matches 10 million users a day.
Tinder's humongous growth is reason enough for its majority owner, Barry Diller's IAC, to buy another large stake in the company — and now the app is worth almost as much as its parent company. IAC purchased another 10 percent of Tinder from venture capitalist and early investor Chamath Palihapitiya for $500 million. That values the company at $5 billion, which is close to IAC's $5.57 billion market capitalization.
And like other quickly growing apps (see: Instagram or WhatsApp), it has yet to record a single penny in profit. Read more at Bloomberg.
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Update: IAC CEO Sam Yagan tells Forbes that Tinder's valuation isn't $5 billion. While it's true that IAC did a transaction with Palihapitiya, the valuation "is nowhere near the truth." The firm actually bought a 10 percent stake for $50 million, which puts it at a $500 million valuation.
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Jordan Valinsky is the lead writer for Speed Reads. Before joining The Week, he wrote for New York Observer's tech blog, Betabeat, and tracked the intersection between popular culture and the internet for The Daily Dot. He graduated with a degree in online journalism from Ohio University.
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