Decrypt’s Art, Fashion, and Entertainment Hub.
Match Group, the parent company of globally-popular dating application Tinder, has made the corporate decision to temporarily withdraw capital investment and innovative focus from the metaverse and digital token sectors.
In a publicly issued Q2 letter to shareholders, Match Group’s newly-appointed CEO Bernard Kim acknowledged that a “metaverse dating experience” has the potential to “capture the next generation of users”, but cited uncertainties around its usability and adoption rate as reasons for retreating to reflect at this time.
Match Group had acquired Seoul-based video and AR start-up Hyperconnect in 2021 for $1.7 billion, but, per Kim's letter to shareholders, has instructed the company to "iterate but not invest heavily in metaverse at this time."
Swiping left on Tinder Coins
A similarly disappointing fate has met Tinder’s digital currency endeavor, Tinder Coins. Designed to serve as an in-app currency that could enhance revenue figures of purchases such as subscriptions, super likes and boost functions, the asset was pilot tested in Australia and was set for a Q3 worldwide launch, but has now been shelved.
Kim's letter stated that following “mixed results from testing Tinder Coins,” Match Group has decided to “take a step back and re-examine that initiative so that it can more effectively contribute to Tinder’s revenue.”
Texas-based Match Group, which also owns dating brands Hinge and Plenty of Fish among others, conceded that it needed to “do more thinking about virtual goods to ensure that they can be a real driver for Tinder’s next leg of growth and help us unlock the untapped power users on the platform.”
Decrypt has reached out to Match Group for further information, but were told that the company is not willing to comment further at this time.
Tinder CEO departs
The news came alongside the imminent departure of Tinder CEO Renate Nyborg after less than a year in the role and just two years at the company. Shareholders were assured that four executives from within the team will oversee the operation under the stewardship of Match Group CEO Bernard Kim until a permanent replacement is found.
The quantitative financials within the earnings letter revealed that Match Group’s total revenue rose by 12% over a year-to-year basis in the second quarter of 2022 to $795 million. Despite this, the company made an operating loss of $10 million and is forecasting profits to taper off throughout the rest of the year.
As for Tinder, Kim shared his optimism that its change of CEO and pivot from nascent digital technologies will ultimately lead to “improved product execution and velocity, monetization wins and enhanced user growth.”