Season 7, Post 2: Time to get dating
Your author (happily married for almost 17 years) is told that the start of the year is peak season for people to use dating apps. The logic seems sound given resolutions and a renewed sense of purpose at the beginning of January. Valentine’s Day is just a month away too. Despite much sceptical media coverage, dating apps look poised for accelerating growth in your author’s view. A morning spent with Match Group in New York in December helped confirm this impression. The statistics below are also courtesy of Match.
Dating is, and always has been, hard. It either works or it doesn’t. We’ve all (or most of us, anyway) been there. The numbers speak for themselves: there are 670m single people of dating age in the world, ex-China. At the same time, 80% of Gen-Z individuals polled say that they are “looking for a meaningful connection.” Online dating can help. It’s certainly had a decent track record, with 59% of people in the US meeting in this way, far higher than through any other mechanism (such as work or through friends). Nonetheless, 220m single people globally have never used dating apps, while a further 30m are considered lapsed users, having tried in the past but currently abandoned.
Meeting online has certainly been destigmatised in recent years, but why the current scepticism, or reluctance to trial? Several factors are cited: poor prior experience, bad matches, potential harassment, ghosting, catfishing and more. It certainly behoves all dating apps to improve their security profiles to minimise the presence of bad actors. Match and peers such as Bumble and Grindr say that they are doing so. However, if ever there were a good use-case for AI acting as an enabler for an industry, then online dating looks to be a prime candidate.
Match says that its ecosystem generates ~5bn new data points daily. Smart algorithms should be able to leverage these data to generate better outcomes. Know more about your users and get better, more personalised matches. Sounds simple. Beyond this, imagine how an intelligent system can help users find optimal picture profiles or perhaps provide effective coaching strategies for struggling users. Algorithms should also be better at spotting rogue profiles. Although there is a clear burden of proof still required, there are reasons to be optimistic. Time to get dating, then.
14 January 2025
The above does not constitute investment advice and is the sole opinion of the author at the time of publication. Heptagon Capital is an investor in Match Group. The author of this piece has no personal direct investment in the business. Past performance is no guide to future performance and the value of investments and income from them can fall as well as rise.
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Alex Gunz, Fund Manager
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