Bumble billionaire but Sugarbook to be banned?

Whitney Wolfe Herd, founder and CEO of Bumble, the second-biggest online dating company, became the youngest billionaire after the company went public. 

After Bumble’s initial public offering (IPO), its shares soared nearly 70% in its trading debut to USD72, valuing the 31-year-old CEO at USD1.5 billion. 

Bumble, a company backed by Blackstone Group Inc, was valued at USD15.6 billion, its stock opened at USD76, significantly higher than its IPO price of USD43 per share.   

According to Bumble’s prospectus, Wolfe Herd owns USD21.54 million shares, equivalent to 11.6% of the company which makes her the youngest self-made billionaire and CEO ever to take a company public in the US. 

In an interview cited from Bloomberg, the CEO said that hopefully this will not be a rare headline referring to the uniqueness of Bumble’s women-led management.

“Hopefully this will be the norm. It’s the right thing to do, it’s a priority for us and it should be a priority for everyone else.”

Wolfe Herd founded Bumble in 2014 shortly after her departure from Tinder, the rival dating app which she co-founded. The split was marked by a sexual harassment lawsuit. However, Tinder refuted the allegations, but the case was quickly and confidentially settled. She was paid USD1 million. 

Bumble is a popular dating app amongst young people. It serves around 42 million monthly active users in over 150 countries around the world. Bumble was established with the aim of creating a comfortable and empowering online dating space for women. 

According to its prospectus, it is poised for growth, pointing to the rising number of single people globally, increased adoption of online dating and signs that users have become more willing to pay.

The firm is also expanding into new areas, like business networking.

But despite an uptick in use, the pandemic has hurt the business, which makes money primarily from subscriptions and in-app purchases.

In 2019, revenue jumped more than 35% and it turned a profit of USD68.6 million.

In the first nine months of 2020, however, its growth rate sank to roughly 15% year-on-year, and it posted a loss of USD116 million.

Against the backdrop of increasing adoption by people, there is a darker side – Sugar Dating. 

In Malaysia, a dating app called ‘Sugarbook’, allegedly used by several tertiary institution students to look for sugar daddies, has led to controversy in a largely Muslim conservative society.

Sugarbook published a survey naming a top 10 list of public and private universities in Malaysia, whose students have been using the app to look for sugar daddies to earn money to solve their financial issues. 

According to the Malaysian Deputy Minister in the Prime Minister’s Department Ahmad Marzuk Shaary, the government should take stern action against those involved, especially the application operator, and there have been calls to ban the app by various parties.