WeChat is far and away the messaging platform that is biggest in Asia at this time, and that’s assisting to drive a push on the list of smaller players to have together for better scale. Today, Momo, the Chinese location-based social network software who has recently made a huge push into dating services and it is exchanged on Nasdaq with an industry limit of around $6 billion, announced so it has obtained Tantan, ChinaвЂ™s top dating app, for вЂњapproximately 5.3 million newly released Class the ordinary stocks associated with the business and US$600.9 million in cashвЂќ.
It is unclear exactly how that cost comes even close to TantanвЂ™s pre-exit valuation: it had never disclosed the quantity. Overall, Tantan had raised $120 million, including a $70 million round last 12 months from a mixture of strategic and monetary investors. Its backers included DST worldwide, Kleiner Perkins, video clip social network YY, Genesis Capital, SAIF Asia, Zhongwei, DCM and Bertelsmann.
WeвЂ™d actually heard rumors of the purchase recently, therefore itвЂ™s perhaps not coming being a complete surprise.
WeChat has in ways written the playbook in China for simple tips to leverage a favorite social platform to transfer to other related solutions (business being one of many biggies), plus it appears that would-be rivals are after suit. Other notable techniques and exits in recent years have actually included Alibaba buying Youku Tudou and in addition spending heavily in WeChat competitor Weibo; selfie-making app Meitu going public and Dianping that is meituan making transfer to transportation.
For the component, Momo was indeed getting into streaming services however with government force on the content among these solutions, planning to its roots that are dating have thought like a safer bet for the present time. The business a year ago reported slightly below 95 million month-to-month users however with a poor perspective, which means this may help it bump up its leads.
Indeed, the ongoing companyвЂ™s stock is currently up 14 per cent thus far trading into the wake regarding the news.
Particularly, the offer will certainly offer Momo a boost that is big its very own relationship business. Tantan stated so it has enabled 5 billion matches since introducing in 2015. (As a place of contrast, Tinder вЂ” one of many leading apps that are dating the West вЂ” claims that its enabled at the least 8 billion matches since its launch in 2012.)
This doesn’t signal a shift for Momo into dating solely (sorry for the pun), but to increase straight down on a single associated with more ways that are successful itвЂ™s diversified its business.
вЂњOur core place continues to focus on social network and this purchase enriches our product line when you look at the space that is socialвЂќ said Yan Tang , chairman and CEO of Momo, in a declaration. вЂњWe continues to invest and incubate more sub-brands to provide the social and entertainment requirements of various demographics. Tantan has grown to become widely recognized in just a quick amount of three years since its inception, that is mostly owing to the outstanding performance of their skilled group. We also respect TantanвЂ™s product strategy that focuses on the customer connection with feminine users. The Tantan group will continue to run the mobile apps beneath the Tantan brand name with this complete support . following the purchaseвЂќ
Indeed, you can view this as just like the strategy taken by IAC, which operates a true range dating apps alongside Tinder, such as Match.com and OKCupid.
For Tantan, the offer gives the business not just a financing boost but possibly some economies of scale with its designer backend as well as other regions of its company. вЂњMomo and Tantan have actually their particular skills inside their respective areas and among targeted customers,вЂќ said Yu Wang , c hairman and CEO of Tantan, in his own declaration. вЂњThe purchase is a crucial strategic update to pay for a better number of user demographics and requirements, and build a bigger social network market through complementary companies and synergy that is strategic. We have been extremely confident within our development this is certainly future.
Additional reporting by Jon Russell ( not this Jon Russell).