Despite Tinder's popularity, dating startups have seen lukewarm investment activity from venture capitalists.

Despite Tinder’s popularity, VC investors aren’t in love with the dating category.

Although Tinder could be worth nearly as much as parent company IAC Corp, VC investors put just under $65M into online and mobile dating startups last year. That’s nothing in a market where $100 million mega-deals to individual companies have become commonplace. It’s also significantly less than other markets that have also been driven by mobile adoption such as food delivery and messaging.

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As the chart below highlights, the funding trend to dating startups has been up and down but has not topped $100M in any of the past five years. The space has also not seen a notable venture-backed exit in recent years. Canaan Partners-backed Zoosk, which filed for its IPO in early 2014, has since seen its founders depart and has delayed its offering indefinitely.  HowAboutWe, backed by Khosla and ff Venture Capital among others, sold its dating and media business lines to IAC in August 2014 but again, this was not a notable exit event for the space.

datingThose startups that have been able to garner recent funding have been mobile-first and/or leverage existing social graphs such as Facebook friends and LinkedIn connections. Among the companies that have raised follow-on rounds in the last year are Cleod9 (dba Hinge), which raised a $12M Series A round led by Shasta Ventures and Chinese gay dating app Blued, which raised a $30M Series B from Doll Capital Management in November 2014.

Below are five select mobile dating apps that have raised VC funding in the past 12 months.

Select Dating Startup Funding Deals 2014-2015
Company Round Amount Select Investors
The League Seed VC $2.1M IDG Ventures, Sherpa Ventures, Structure.vc
Hinge Series A $12M Shasta Ventures, Lowercase Capital, CAA Ventures, Eniac Ventures
Happn Series A $8M Alven Capital, DN Capital
Coffee Meets Bagel Series A $7.8M Doll Capital Management, Azure Capital, Quest Ventures
Tantan Series A $5M Bertelsmann Asia Investments

Photo Credit: Wonderlane

All of the data in this research brief comes from the CB Insights Venture Capital Database. Sign up free below.

 

  • http://onlinedatingsoundbarrier.blogspot.com/ FernandoArdenghi

    Lack Of Innovation & Decadence can summarize the Online Dating Industry for years.
    Online Dating for serious daters does not need to be more social, it needs to be more effective/efficient. It needs to reduce the false positives problem.
    I had reviewed over 55 compatibility matching engines intended for serious dating since 2003, when I had discovered “the online dating sound barrier” problem.
    C-level executives are cooking barbecues under the water (selling smoke) and not paying attention to latest research from Academics which could be beneficial for the Online Dating Industry. The key to long-lasting romance is STRICT PERSONALITY SIMILARITY.
    The only way to revolutionize the Online Dating Industry is using the 16PF5 normative personality test, available in different languages to assess personality of members, or a proprietary test with exactly the same traits of the 16PF5 and expressing compatibility with eight decimals (needs a quantized pattern comparison method, part of pattern recognition by cross-correlation, to calculate similarity between prospective mates.)
    High precision in matching algorithms is precisely the key to open the door and leave the infancy of compatibility testing.

    Without offering the NORMATIVE16PF5 (or similar test measuring exactly the 16 personality factors) for serious dating, it will be impossible to innovate and revolutionize the Online Dating Industry All other proposals are NOISE and perform as placebo.

  • CTucker

    As a “dating” application developer I agree and disagree with you at the same time. The “dating” applications of our time aren’t exactly “dating” applications at all. It’s more of a get hitched type of application scene where you’re thrown into something knowing nothing about the person besides for what they might look like. Our application has taken a serious attempt to change the way the game is played, but in the end it’s not really a “dating” application, is it? No. I don’t think so at least. It’s more of a social application. I believe the biggest problem in this industry is that the term “dating” is overused.