By Harshita Mary Varghese
Oct 13 (Reuters) – Bumble is set to go private in a $1.3 billion deal with Ithaca Holdings after struggling for years to revive growth, as a prolonged decline in users and shifting Gen Z dating habits batter the online dating industry.
Shares of the company soared 56% to $5.95 in early trading on Tuesday, after having surged 50% on Monday following media reports on the Ithaca deal.
Bumble and larger rival Match, which owns Tinder and Hinge, have been battling declining user engagement, as younger users increasingly grow tired of swiping endlessly on apps and seek more organic ways to build connections.
Match has so far outperformed Bumble with its portfolio of apps that cater to niche demographics, as well as international growth at Hinge, which draws users with its detailed, relationship-oriented profile formats.
Bumble said Ithaca co-founders Ravi Gupta and John Hegeman will become Bumble’s co-CEOs after the takeover.
The firm has offered $6.05 per share for Bumble, representing a 122.4% premium to the stock’s closing price on June 24, a day before Reuters exclusively reported the company was exploring a sale.
Founded in 2014 by Whitney Wolfe Herd, Bumble pioneered the “women-first” approach to online dating that has been a defining feature for the company. But it rolled back the feature this year in a bid to improve its user retention rates.
Under Herd, who returned as CEO in March 2025 after stepping down in 2023, the company has tried everything from raising prices and extending reply windows to adding AI tools that help users craft messages and exploring offline events to keep users hooked.
It has also been testing a new AI matchmaking assistant in response to traditional swiping fatigue.
But that has failed to aid its recovery. Total paying users fell 16.4% to 3.2 million in the second quarter, while quarterly revenue has been declining for nearly two years.
Bumble’s market value has shrunk to about $582 million as of Monday’s close, a far cry from its $14 billion valuation when it went public in 2021.
“There hasn’t been a lot of innovation in the dating space for a while, and now that AI is here, the apps are going to be forced to innovate,” said Liesel Sharabi, an associate professor at Arizona State University who studies online dating and relationship technology.
Blackstone, which owns about 14% of Bumble, according to LSEG data, and Herd have provided required shareholder approval for the deal.
(Reporting by Harshita Mary Varghese and Jaspreet Singh in Bengaluru; Editing by Sriraj Kalluvila and Leroy Leo)
Comments