You’ve Got a Friend in New Social-Media Apps

Bill Mount

Relationships come and go, but friends are forever. At least, that is the direction dating apps are swiping. Social media is getting crowded, with nearly half of the world’s population using one of Facebook’s apps every month. The market for connecting with existing friends may be well saturated, but it […]

Relationships come and go, but friends are forever. At least, that is the direction dating apps are swiping.

Social media is getting crowded, with nearly half of the world’s population using one of

Facebook’s

apps every month. The market for connecting with existing friends may be well saturated, but it seems finding new ones is still something of an unmet need.

Friendship finding is, apparently, very hot right now. An analysis recently published by venture-capital firm Andreessen Horowitz showed friend discovery is the fastest-growing category of mobile social app in the U.S. Citing data from Apptopia, the firm showed friendship apps like Itsme, Wink and Yubo are some of the fastest-growing apps nationwide, solving for various pain points that exist in social media today. Itsme, for example, lets you make friends as your avatar to avoid getting judged based on a photo; Wink allows you to make friends safely without the awkwardness of exchanging phone numbers or traditional social-media handles.

Dating apps want in on the platonic action. Women-first dating app

Bumble

is a prime example. Its founder

Whitney Wolfe Herd

seems to have a knack for understanding what is next in social media. Ms. Herd co-founded Tinder, which has grown to become the world’s largest dating app. She then left to found Bumble, a decision that has reportedly made her the world’s youngest female self-made billionaire following the company’s public offering earlier this year.

Ms. Herd is betting her company can apply what’s worked with dating to friend finding, and even use it as a more relaxed way to entice new users to pay for its higher stakes dating app. Bumble BFF, the app’s product extension for friendships, was launched in 2016, though the company says it is still in the early stages of its development.

It has had a promising start. Per Bumble’s public offering filing, Bumble BFF already accounted for about 9% of its total monthly active users as of September 2020. That traffic seems to have come mostly organically, without much recent marketing. The feature is actually rather hard to find, requiring a dating user to toggle to settings and switch to BFF mode.

Still, the company says BFF has been extremely popular, particularly for people like new moms, those who have just moved to a new city because of remote work, and those who already have enough best friends, but are looking for, say, a yoga buddy. Bumble said its product extensions like BFF and newer Bizz, which is focused on professional connections, have even been useful as customer acquisition tactics to entice users in geographies like India where dating apps aren’t yet the norm.

Dating giant

Match Group,

which owns Tinder, Hinge, Match.com and Pairs, among other apps, has also been chasing friendships and other platonic connections. It estimates this market is twice the size of dating because it isn’t narrowly focused on meeting one single person at a time. After teasing its interest in “dating adjacent categories” on its fourth-quarter conference call, the company said last month it was paying more than $1.7 billion in cash and stock to acquire South Korean social-media company Hyperconnect in its biggest acquisition ever.

Match says Hyperconnect is already generating profits and did $200 million in revenue in 2020, up 50% year on year. Hyperconnect owns two video apps in Azar, which Match says is the highest grossing one-to-one video chat app in the world; and Hakuna, which offers group live video, audio and avatar-based streaming. About 75% of Hyperconnect’s usage currently comes from Asia, but Match plans to expand that into new geographies under its umbrella and leverage its technology to bolster its existing platforms.

Match isn’t entirely new to the social discovery space. It incubated Ablo, for example, an app that launched in 2019 and allows people to match with others across the world through video. And amid the pandemic, its Tinder users were temporarily able to use its Passport feature for free to chat with people in other ZIP Codes. They did this in order to connect with users in countries where the pandemic was farther along, helping to understand what was to come where they live, the company said.

While friendship apps are well on their way in terms of increasing adoption, many aren’t yet widely monetized. Bumble, for example, isn’t making any money off BFF yet, but said in its initial public offering filing it plans to invest in marketing for the app and to develop a monetization strategy, indicating revenue from that channel could come soon.

That would be a bonus for investors in dating apps, who still have time to get a fresh introduction.

Write to Laura Forman at [email protected]

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