When The Meet Group released its end-of-year financial results, it also announced the complete acquisition of Growlr, a gay dating platform with over 200,000 daily active users. It marked the end of a successful 2018 for the dating umbrella, which saw its annual adjusted EBITDA climb to $32 million.
GDI caught up with CEO Geoff Cook to discuss the details of the acquisition and what plans The Meet Group has for the future.
Read the full interview below:
Growlr is slightly different to the brands you’ve worked with before, what initially attracted you to it?
GC: “We’ve been interested in the same-sex dating space for some time from afar, keeping in touch with what’s going on in that market and what’s moving. Having added live streaming video to LOVOO, Skout and Tagged we’ve been looking for spaces that are broadly similar in terms of what users are doing, chatting and so forth, but that we don’t serve. That can be new geographies or it can mean new niches, so we felt that gay dating just made a lot of sense.
We’re also opportunistic buyers, we took a while to evolve so we felt like we understood the space well enough. Growlr we felt brought both a combination of good EBITDA and good valuation while allowing us to really get our feet wet and really understand how the gay dating market will take to live streaming video. We’re excited to video enable it and I expect we’ll do that by the end of the year. That’s really what the impetus and thesis was for the acquisition.”
Are you going to make any specific product considerations for this new audience?
GC: “I think the product itself does optimise for that audience. The gifting model is obviously critical to the live streaming video so we probably will have gifts that are specific to the audience, that will be relatively customised. In general, we don’t see significant changes to the model, mostly just around image assets and the gifts that are given over the course of the live stream.”
Can we expect any more mergers and acquisitions from The Meet Group in the near future? Is that something you are actively pursuing?
GC: “We’re certainly opportunistic. We didn’t buy anything in 2018 but in 2016 and 2017 we did and obviously we started the year 2019 buying something. So we’re certainly not close to anything right now but we’re always aware of the space.
I think it’s important to have deal flow but it’s not important to our story to do another acquisition, for example. I’m sure if you go far enough into the future we’ll probably do one; we’ve done four in the last three years or so.
What we’re really focused on right now is driving that video penetration and getting more of our users on video, we want to see that be closer to 35% and we want to grow that video ARPDAU [Average Revenue Per Daily Active User] from roughly 20 cents to 35 cents. We feel like if we do those two things video won’t be an $88 million business, like we guided it to be on the call in 2019, it will be $200 million annualized business.
Growlr was just a very good opportunity at 4.5 times EBITDA with an audience we could also video enable and drive revenue from, so if the right opportunities come along of course we’ll act.
Turning to what else The Meet Group is planning over the course of the year, Cook explained that he’s working on a multitude of ways to involve the 80% of users who aren’t yet fully engaging in live streaming.
This includes the introduction of one-to-one video chatting, which he hopes could see advancements by summer. Furthermore, users could see trending and nearby streamers appearing at the top of their feed, encouraging them to join.
LOVOO is The Meet Group’s most popular platform by daily active users. As its main audience comes from mainland Europe, Cook wants its growth to continue to expand by integrating more English-speaking consumers. Battles, the competitive streaming feature already available on MeetMe, Skout and Tagged, will be brought to LOVOO by the end of March.
The Meet Group will be speaking at GDI’s first ever Singapore Dating Conference. Click here to find out more and purchase tickets.
Visit The Meet Group website here.