Hinge
The way Justin McLeod sees it, Tinder is the MySpace of the mobile dating world and Hinge, the app he started, is the Facebook. At least, that’s the dream. And now, McLeod has a fresh round of funding to make that dream come true.
On Thursday, Hinge announced it has raised an additional $12 million, which will fund Hinge’s already rapid expansion into new cities, including the launch of its first international outpost in London this February. This year alone, Hinge has expanded to 24 new cities, and it has experienced 500 percent growth in its user base since January.
The app capitalizes on the swell of activity in the mobile dating space, that began with Tinder’s launch back in 2012. But Hinge has a unique premise: it only connects users who have mutual friends on Facebook. That way, the potential matches are far more curated than they would be on Tinder, where anyone within a certain radius is fair game. McLeod admits that’s made it tough to grow as fast as Tinder, which has been downloaded 40 million times in two years and makes 14 million matches a day, according to Forbes. And yet, McLeod believes this comparatively measured approach to growth will serve Hinge well in the long run.
“Obviously, they’re bigger than we are. They have more users than we have, but over time the user experience gets diluted on Tinder,” McLeod says, and that’s where the MySpace comparison comes in. “If you told anyone in 2005 that Facebook would be bigger than MySpace, they’d think you’re insane. But Facebook really became a utility. It’s about who you know in real life, so it ended up becoming something people relied on.”
Tinder the Wannabe
When McLeod first launched Hinge as a web app back in 2011, Tinder didn’t even exist, and Hinge was a much tougher sell to users. But the next year, Tinder burst on the scene. Initially, McLeod says he viewed Tinder as just another wannabe. The real competitors, he thought, were existing sites like OkCupid and Match.com.
“So many competitors pop up and very quickly die, so initially I saw Tinder as another one of those,” McLeod says. “That obviously was not the case. So yes, there was a moment of, ‘Oh shoot.'” It became clear that the future of the dating industry was on mobile, and so, last year, Hinge launched its first mobile app, which has been growing steadily ever since.
But online dating is an ugly business, even McLeod knows that. It’s been traditionally dominated by IAC’s Match Group, which owns Tinder, OkCupid, and Match.com, and spends millions marketing to new customers. “You’re constantly churning people through the business,” McLeod says. “As a result you have to think, ‘How can we keep these people in the pipeline longer?'”
But Hinge, he says, attracts the majority of its users through word of mouth. That means McLeod is more concerned about ensuring the app is something people will continue to tell their friends about than he is about keeping a given user that he paid to advertise to. “As long as we can own the dating market for people between the age of X and Y, who are single, there will always be a pool of people,” McLeod says.
The Caveat
Well, that’s true as long as that pool of people chooses Hinge over Tinder. McLeod’s approach ignores the possibility that maybe, the magic of Tinder is the fact that it’s so lightweight. People aren’t afraid to join Tinder, because, as McLeod says, they think of it as a game, and besides, everyone’s a stranger, so how bad can it be? But when everyone on the app is connected to you in some way or another, signing up can become a much tougher decision.
With this new round of funding, Hinge will have added pressure to come up with a revenue strategy. McLeod says he’s already given investors a clear picture of what that strategy will be, but all he’ll say publicly is that it’s not happening in 2015 and it won’t be similar to the paid product Tinder released last month.
And yet, for all the competition between the two companies, McLeod admits that Tinder did Hinge a great service in its early days by making online dating socially acceptable to an entirely new audience. “It’s been kind of nice that Tinder got out there first,” he explains. “It’s given us a counterpoint to say: ‘It’s like Tinder, but not creepy.'”
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