Bumble Founder & CEO Whitney Wolfe and Man Repeller Founder Leandra Medine onstage during Girlboss Rally hosted by Sophia Amoruso’s Girlboss
A day or two later, it’s there. And the next day, it’s not. Like things that are of the soul, money can shift in a matter of minutes.
A dramatic decline in Bumble shares since the owner of the dating app’s quarterly earnings conference on November 10 has slashed the fortunes of its co-founder and CEO Whitney Wolfe Herd, who was previously the world’s smallest self-made millionaire–below one billion dollars, the Forbes calculates.
Herd, 32 years old Herd was valued at $940 million as of Monday’s closing value which was $35.03 for each share. The value of her net worth plummeted by over $200 million since the third-quarter earnings were revealed about three weeks ago since Bumble stock has plummeted by 26 percent. Wolfe Herd has a 21 percent share in Bumble, which she co-founded in 2014 to create dating apps that let women make their first decision. She also holds around $100 million in selling a small portion of her stake to private equity group Blackstone for 2020. the family office informed Forbes.
The representatives of Bumble and Herd’s office have not responded to inquiries for comments on this story.
Bumble was a buzzing topic for investors at the time of its IPO in February. Its Tinder and Hinge competitor–the second biggest dating application to be listed following Match Group’s debut in 2015–cracked $2.2 billion with an $8.6 valuation when it first started with a price of $76 per share, which is well above its $43 fee on its listing. The IPO’s success increased the fortune of Wolfe Herd to $1.5 billion, which makes her the youngest self-made woman billionaire and the first female CEO to go to the public market.
But it has been unable to maintain that same momentum after. The shares have fallen since the peak on February 16 at $78.89 for a claim. They were trading at $60 in September before taking plunges of up to 80% earlier this month. Investors were worried during the latest quarterly earnings call after the company reported the first decline in its overall users for the first time in its IPO. The number of paid users fell to 2.87 million over September, dropping from 2.93 million in the previous quarter.
The drop in users was primarily due to Bumble’s other app for dating, Badoo, which is well-known outside of in the U.S., investors were more concerned about the performance of its dating app for women that did not have nearly as many paid users as they had hoped, JPMorgan analyst Cory Carpenter stated in the magazine. Bumble has added 60,000 customers who paid for it instead of the anticipated 87,000, and its rival Match Group reported a record 800,000 users on the dating application Tinder in the week preceding.
The Bumble application had its revenues rise 39% over the year, to $142.5 million. In addition, the overall business (including Badoo) beat Wall Street expectations with total revenues of $201 million for the quarter, boosting its revenue forecast for the whole year due to this. Bumble has reduced its losses to $10.7 million from $22.8 million in the previous year; however, the company could lose more than double the amount analysts had predicted.
Bumble isn’t the only one to experience difficulties in the aftermath of its IPO. A recent analysis released on Sunday in The Financial Times found fifty percent of the companies that raised over $1 billion through IPOs in the past year have traded below the price of listing despite the strong performance of the stock market and the escalating number of IPOs which have brought in $330 billion to date so far, according to figures from EY. The other publicly traded company struggling is Swedish Oat-milk king Oatly which’s market capitalization is about $7.5 billion lower than its May launch. U.K.-based food delivery service Deliveroo and Indian Paytm, a giant in payments Paytm, are still under their market prices after experiencing massive stock losses following the significant initial public offerings.
Wolfe Herd famously launched the dating app with a twist following an abrupt exit in Tinder during 2014. The company sued her former employer for discrimination and sexual harassment with the claim that she was removed from her co-founder title and received threats and defamatory texts by her boss and ex-boyfriend. The matter was swiftly and confidentially resolved with Tinder (the company has denied any illegality) before Wolfe Herd struck out on her own and enlisted assistance from the London-based Russian billionaire Andrey Andreev to build an alternative dating platform aimed at offering women a more secure environment.
The July report from a Forbes report discovered a toxic and hostile environment in the Badoo/Bumble company’s London headquarters, as reported by former employees. Andreev had denied some of the allegations but additionally initiated an investigation into the alleged toxic workplace culture just when that Forbes article appeared. A few months later, Blackstone’s equity-based private company acquired the majority stake in Bumble/Badoo parent company MagicLab by purchasing Andreev’s share in a deal valued the business at $3 billion.