Bumble, which is slated to go public later this week, significantly boosted the size of its initial public offering and raised the price range.
Bumble on Monday said it plans to sell 45 million shares at $37 to $39 each, up from the 34.5 million shares at $28 to $30 each that it expected to sell last week. The dating app could raise as much as $1.8 billion if it prices on the high end of its expected range. At $39 a share, Bumble’s market cap could hit $7.2 billion.
Bumble is expected to trade on the Nasdaq under the symbol BMBL. The company is scheduled to price its deal on Wednesday, Feb. 10, and trade the next day, a person familiar with the situation said. Goldman Sachs (ticker: GS) and Citigroup (C) are underwriters on the deal.
Whitney Wolfe Herd
founded Bumble in 2014. The start-up calls itself a “women-first” dating app because it allows women to make the first move. Women, once they match with someone, have 24 hours to start a conversation with their “target.”
Bumble operates two apps, Bumble and Badoo. More than 40 million users visit the apps each month to connect with new people. Bumble has 12.3 million monthly active users as of Sept. 30, while Badoo has 28.4 million monthly active users, according to Sensor Tower data.
Bumble competes against Tinder, which is owned by Match Group (MTCH).
also operates Match.com, OkCupid, and Hinge.
(FB) has also introduced a dating feature on its platform.
Bumble isn’t profitable. The start-up reported a loss of $84.1 million for the Jan. 29, 2020 to Sept. 30, 2020 period, compared with a profit of $68.6 million for the first nine months of 2019, a prospectus said. Bumble reported revenue of $376.6 million for the January to September 2020 period, up from $362.6 million in 2019. Long-term debt stood at $557.4 million as of Sept. 30
“Online dating has surpassed traditional ways for couples to meet or get the first introduction, and Covid-19 has accelerated this trend,” said
executive director of MKM Partners, in a Feb. 8 note.
Bumble has seen an uptick in its earnings before interest, taxes, depreciation, and amortization, or Ebitda margins, which was likely caused by sponsor-driven cost optimization, said Kulkarni, who watched the Bumble roadshow but is not participating in the offering nor initiating coverage.
Risks for the dating app include competition from rivals like Match.com and Facebook, as well as the company’s significant leverage, uncertain post-pandemic trends and concentrated sponsor ownership after the IPO (Blackstone will have roughly 80% voting power after the offering).
Write to Luisa Beltran at [email protected]