Interview: CEO Looks to the Future Following Affinitas-Spark Merger

Earlier this week, GDI reported the completion of the Affinitas-Spark Merger.

The new combined company, trading as Spark Networks SE, will be home to household names including EliteSingles, Christian Mingle and Attractive World.

Following up on our pre-merger interview in May, GDI caught up with CEO Jeronimo Folgueira to find out more about the future of the group.

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When we spoke to you in May with Brad Goldberg, you said that EliteSingles’ USA growth was going to be the number one priority for the combined group. Is that still the case, and if so, how’s it going?

JF: ‘Yes, that’s still the number one priority, and it’s going really well. EliteSingles continues to perform extremely well in the US Market. We see North America, basically, as going to be our growth driver going forward. We see a lot of potential, also, for the Spark brands to regain some of the lost ground – in the US market in particular.’

How do you see that working with some of the big brands that are in the US already – say eHarmony and Match.com – do you think you’re going to be entering a similar space with EliteSingles or will you be trying to do something different?

JF: ‘I think we have very unique USPs, and that our brands cater to very specific needs in the market. EliteSingles is a more serious and premium version of existing market brands, and so we target a more serious, affluent and highly educated user base.

The Spark brands are mostly religious-based – for the Jewish community or for the Christian community – making them quite unique. We don’t see ourselves as competing against Match or eHarmony, we see ourselves as filling the needs of a specfic demographic.’

Last time we spoke, you had a few different second priorities. You wanted to revive the Christian and Jewish brands, you wanted to expand Attractive World into some more markets, and you wanted to grow some of the newer brands. Have any of those emerged as a clear second priority for you?

JF: ‘The plan remains, but we can’t execute anything yet because the deal only closed on Friday last week. We’ll continue with our focus on EliteSingles, but the plan has not changed – we’ll continue our work on the smaller brands as a second priority, trying to revive Christian Mingle and JDate – but the focus will be on EliteSinlges as our flagship brand.

The second priority is to opportunistically capture opportunities, rather than any one thing in particular. I believe in focusing on one thing and getting that right, rather than focusing on a thousand things.’

What has the geography of the company ended up looking like? Obviously you want to keep a big presence in the US for EliteSingles – has that led you into keeping Los Angeles?

JF: ‘No, the Los Angeles office is going to be closed by the end of this year, and we are going to run everything worldwide out of Berlin. In terms of the centralised operations of the business, we will run it out of Berlin as we have always done.

However, in terms of our focus for the company, we’ll be almost 50/50 between North America and International. We will allocate resources accordingly, though we hire a lot of North Americans out of Berlin.’

Sure, so what is the function going to be of the offices in New York and Utah? Is that going to change at all?

JF: ‘The New York office is going to be finance focused, so we’ll do investor relations out of New York. The office will remain finance and corporate – it’s a very small office.

Utah will continue to be the same – it’s customer care in English. We’re keeping that, and we’ll move EliteSingles customer care to Utah as well. It’s better to have agents in the right time zone.’

But all of the strategy work and all of the big decisions are still coming out of Berlin?

JF: ‘Yes’.

You don’t see that as a challenge, rather than being in America and being in the timezone itself?

JF: ‘Absolutely not. If you look at EliteSingles, it’s bigger than the Spark brands, and we ran that out of Berlin. I don’t see the need of being in a market in order to succeed in that market. The world is digital nowadays.’

You’ve said before that the key to bringing back some of the old Spark brands is to integrate your new technology platform, and once you’ve done that, increase the market spending. Is that something you’re still on track with?

JF: ‘Yes, the Spark brands have already been migrated to a new tech platform so the product has naturally improved. We migrated JDate in August, and Christian Mingle at the end of September.

Now, we will be looking at starting to increase marketing slowly in the next few months. Obviously we need to measure everything – we’re very performance marketing driven – so we’ll see how the performance goes and allocate resources accordingly.

We will run the brands with the same analytical tools that we have used for EliteSingles quite successfully.

It’s going really well – all to plan. Everything has been delivered exactly on the timetable we had, so we’re very very happy with that.’