08 November 2019 18:43
NEW YORK--(BUSINESS WIRE)--Blackstone (NYSE:BX) announced today that funds managed by Blackstone ("Blackstone") are taking a majority stake in MagicLab, which builds and operates leading dating and social networking apps, including Bumble and Badoo. The transaction values the company at approximately $3 billion. Founded in 2006 by Andrey Andreev, MagicLab helped invent how people meet in the modern, mobile age. MagicLab's suite of brands has connected and transformed the lives of over 500 million people around the world across dating, social, and business. The group shares a foundation of technology, talent, and experience to constantly innovate new ways for people to meet and create life-changing moments by building relationships.
Over his career, Mr. Andreev has been at the forefront of innovation in the dating industry and has continued to invest in finding the most talented entrepreneurs and tech visionaries to mentor. As part of the acquisition, Mr. Andreev will be selling his stake and stepping down from the business. He will be replaced as CEO by Whitney Wolfe Herd, Founder and CEO of Bumble, who, together with Blackstone, will work to accelerate the business' growth even further. Commenting on the transaction, 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.
Martin Brand, a Senior Managing Director at Blackstone, added: "We look forward to partnering with MagicLab to help fuel the company's continued expansion in the years ahead." Citi Global Capital Markets Inc. is serving as an exclusive financial advisor to MagicLab and is providing financing in support of the acquisition by Blackstone. Davis Polk & Wardwell LLP is serving as legal advisor to Whitney Wolfe Herd, the founder and CEO of Bumble. Baker McKenzie is serving as legal advisor to the majority shareholders of MagicLab (including Andrey Andreev) and Simpson Thacher & Bartlett LLP is serving as legal advisor to Blackstone. Founded by Andrey Andreev, MagicLab invented how people meet in the modern, mobile age. Through its growing family of brands that include Badoo, Bumble, Chappy, and Lumen, MagicLab has connected and transformed the lives of over 500 million people around the world across dating, social, and business.
Our group shares a foundation of technology, talent, and experience to constantly innovate new ways for people to meet and drive long-term growth. Blackstone is one of the world's leading investment firms. We seek to create positive economic impact and long-term value for our investors, the companies we invest in, and the communities in which we work. We do this by using extraordinary people and flexible capital to help companies solve problems. Our asset management businesses, with $554 billion in assets under management, include investment vehicles focused on private equity, real estate, public debt and equity, non-investment grade credit, real assets and secondary funds, all on a global basis. Blackstone Group Inc. is taking a majority stake in the owner of dating app Bumble as part of the private-equity giant's broader push to invest more in fast-growing companies. The deal, which was announced Friday and previously reported by The Wall Street Journal, values dating-site parent company MagicLab at about $3 billion, Blackstone said. Bumble, the popular and profitable dating and networking app built around the ethos of women calling the shots on how connections get made and developed, has made a deal for some independence of its own. Andrey Andreev, the founder of Badoo, the controversial London-based company that owns a series of dating apps and was the main backer and builder of Bumble, is selling his entire stake in MagicLab, the company that owned both Bumble and Badoo (and other dating apps), to Blackstone and will step away from the business. Whitney Wolfe Herd, Bumble's founder, becomes become the CEO of the whole company, retaining much of her stake in the business in the process. The deal values Bumble and the wider business--which is profitable--at $3 billion. Blackstone will also be making an investment in the company as part of the deal. "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," said Wolfe Herd in a statement. 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." The WSJ reports that Bumble now has some 75 million users, although Apptopia's figures are a little more conservative: it notes that aggregated, lifetime downloads of Bumble are about 52 million, while lifetime in-app purchase revenue is about $335 million. But while Bumble has been growing at a healthy clip--in addition to being profitable, MagicLab had revenue growth of 40% annually--the transaction caps off a tumultuous time at the corporate level for the company. Almost exactly a year ago, Andrey Andreev had been talking about a future IPO for Badoo in the US, listing on Nasdaq. The bigger company at the time also included the eponymous Badoo app, which itself now has 450 million users, as well as a number of others targeting more specific communities (for example, older people), and it was altogether expecting to make some $400 million in revenues in 2018. Badoo prior to that had reportedly turned down a $450 million offer for Bumble from Match (Some have reported that Match might have offered as much as $1 billion or more for it)--a strange twist in a long saga between the two. (In brief: Match is the company that owns Tinder and had been locked a series of different lawsuits with Bumble: Wolfe Herd had previously been a Tinder co-founder and left under acrimonious circumstances. Andreev had previously met Wolfe Herd and then approached her to come and start Bumble under his wing in the wake of that departure.) While a bold IPO was an interesting prospect, things took a turn for the worse this summer, when an expose in Forbes painted a bleak picture of misogyny and sleaze at the parent company, headed by an eccentric and oblique leader--not the image that Bumble wanted to project, and definitely not the image that would have read well on Wall Street. "We're excited to invest in MagicLab, which is a pioneer in the fast-growing online dating industry. They have a highly talented team and strong set of platforms, including Bumble, which was built on a commitment to inclusion and female empowerment," said Jon Korngold, Head of Blackstone Growth (BXG), in a statement. "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." Nov 8 (Reuters) - Blackstone Group Inc BX.N is taking a majority stake in MagicLab, the parent company of dating app "Bumble" and "Badoo", valuing the company at about $3 billion, the private equity firm said in a statement on Friday. Following the deal, Andrey Andreev who is the founder of MagicLab, will sell his stake and be replaced as chief executive officer by Whitney Wolfe Herd, Bumble's present CEO. Bumble began in 2014 as a dating platform for women to start discussions with potential male partners and competes with Match Group Inc's MTCH.O Tinder and Facebook's FB.O dating service.