The Wall Street Journal has reported that Blackstone Group Inc., a major American multinational, is set to take a majority stake in MagicLab, parent to Badoo, Bumble, Chappy and Lumen. The deal values the group at $3 billion.
Badoo Founder Andrey Andreev will exit and sell his stake as part of the deal, while Bumble Founder Whitney Wolfe Herd will take over as MagicLab CEO, retaining most of her ownership. Together, the pair held around 80% of the dating group.
The new parent is looking to introduce Bumble into new territories and support its efforts to become a complete social media service, expanding Bizz, BFF and the brand’s offline meetups. There is no word yet on its plans for the other platforms.
Blackstone, which holds $554 billion in assets, describes itself as “one of the world’s leading investment firms”. Their surprise move comes as part of an effort to hold $1 trillion by 2026.
Jon Korngold, Head of Blackstone Growth, said: “[MagicLab] has really outgrown most of the landscape of growth equity, but they haven’t outgrown Blackstone.
He added in a press release: “This partnership is a perfect example of Blackstone’s ability to use its scale, long-term investment horizon, and deep bench of operational resources to help entrepreneurs take advantage of transformational growth opportunities in order to create global industry leaders over time.”
In 2018, prior to the introduction of the MagicLab umbrella, Tinder’s parent Match Group looked into buying the Badoo group for $1 billion. Andreev reportedly declined the industry leader’s advances at the time, claiming the portfolio was worth far more than what was being offered.
Badoo claims to have almost 500 million users worldwide, while Bumble has around 75 million, mostly in developed Western nations.
Chappy and Lumen, the two smaller brands in the group, each cater to niche audiences. The former describes itself as “Bumble’s gay dating app”, while the latter is “specifically designed for over 50s”.
Commenting on the acquisition, Andrey Andreev said: “Blackstone presented MagicLab with a great opportunity to further develop the brands and platform, and I am confident Blackstone will take MagicLab to the next level in terms of growth and expansion. I am incredibly proud of the company, and of how we have connected millions of people around the world.
“At MagicLab, I have had the pleasure of working with some of the best and most talented entrepreneurs. My aim now is to ensure a smooth and successful transition before I embark on a new business venture in search of innovative leaders with new and exciting ideas. I am grateful for all the support of my partners and employees over the years as we couldn’t have gotten to this point without them. I wish MagicLab and Blackstone every success.”
Whitney Wolfe Herd added: “This transaction is an incredibly important and exciting moment for Bumble and the MagicLab group of brands and team members. Blackstone is world-class at maximizing the success of entrepreneur-led companies, which presents a tremendous opportunity. We are very excited to build the next chapter with them. I am honored to take on the role of CEO of the group.
“I will strive to lead the group with a continued values-based and mission-first focus, the same one that has been core to Bumble since I founded the company five years ago. We will keep working towards our goal of recalibrating gender norms and empowering people to connect globally, and now at a much faster pace with our new partner.”
MagicLab has been acquired by Blackstone just weeks after InterActiveCorp (IAC) announced its intention to let Match Group stand alone. Match will take on significant debt as part of the deal.
The news also comes two months after Facebook Dating launched in the US. Facebook has a market cap of $546.37 billion, while Blackstone is valued at $61.26 billion and Match at $19.09 billion.
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