Whitney Wolfe Herd was the youngest self-made woman billionaire when her dating app company went public.
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This month, shareholders have lost a lot of love for Bumble.
The dating app company's shares are down more than 20% after a quarterly earnings report gave some investors cold feet. Whitney Wolfe Herd's fortune was slashed by more than $200 million as a result of the stock's selloff.
Wolfe Herd became the world's youngest self-made woman billionaire when her stake in Bumble grew to over $1 billion. Her family office says that she has about $100 million from the sale of a portion of her ownership in 2020. At Friday's closing price of $36.38 per share, Wolfe Herd is worth just over $1 billion.
At least for now, what has investors ghosting Bumble done?
In the third quarter, the company's total paying users fell to 2.97 million from 3.03 million in the prior quarter, but overall user growth did not decline.
Badoo is a dating app that is popular outside the U.S. Badoo's usership fell more than 8% compared to the prior quarter and its revenue declined 3% year-over-year. Wolfe Herd said that the drops were due to the influence of the Pandemic overseas and a payment issue affecting devices that management is working to fix.
Wolfe Herd said in an earnings call that Badoo operates in a lot of markets where the Pandemic is still a challenge. The core Badoo user community, which is predominantly in the urban middle-class segment, continues to face economic pressures.
The main concern was that the core product of the company, the women-orientated dating app, didn't tally as many new paid users as expected.
Match Group reported a record 800,000 new paid customers for its dating app rival, the week before. The bar for Bumble has been raised by the results of Tinder. He says that Match does X and that they expect Bumble to do Y.
The damage to Bumble's stock was overblown. The revenue of the app was up 39% year-over-year. Overall, the company came in ahead of Wall Street expectations, with total revenue of $201 million for the quarter, and it raised its full-year revenue forecast as a result. The net loss was more than double what analysts had predicted, but it was down from the previous year.
They are trading at a significant discount to Match. People are willing to pay more for the reopening.
The company raised more than $2 billion from its public debut. Its IPO price was $43, but shares opened at $76 per share, well above the price. The investor enthusiasm hasn't changed since. After hitting a peak of $59.94 in early September, shares began to decline and reached their lowest point since the IPO this month.
During an interview at the Forbes Under 30 Summit in October, Wolfe Herd said she is not obsessed with the stock. She said, "If you're trying to get to that next milestone, don't focus on the short term."
Wolfe Herd was one of the first employees at the company and launched the dating app Bumble in the year of 2014). She sued her former employer for sexual harassment and discrimination, which was quickly settled, and then started Bumble with the help of a London-based Russian billionaire.
According to former employees, a toxic, misogynistic environment was found at the London headquarters. After the Forbes article was published, he announced an investigation into the alleged behavior.
In November of last year, a private equity firm swooped in to buy a majority stake in the MagicLab group, which was valued at $3 billion, while Wolfe Herd held onto the majority of her ownership.
Wolfe Herd was able to navigate the company to its public offering amid the depths of the pandemic. She needs to figure out how to get more paying customers to use the company's dating apps in both Europe and the U.S.
