Grindr SPAC: Everything you need to know about Grindr stock

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By : ,  Financial Writer

Grindr SPAC: When will Grindr stock go public?

Grindr is expected to go public via a SPAC deal with blank cheque company Tiga Acquisition Corp. (TCA) in the second half of 2022. The announcement was made on May 9, and the deal is expected to close following regulatory and stockholder approval. The deal has already been unanimously approved by both boards of Grindr and Tiga. SPAC deals usually happen faster than traditional IPOs and with less warning for public investors.

Learn what SPAC deals are and how they differ from IPOs

Upon closing of the deal, the combined company will be publicly traded under the name Gindr Inc. It is expected to be listed on the New York Stock Exchange where Tiga already trades under the ticker ‘TINV.’ It is unknown if the stock ticker will change after the merger.

Proceeds from the SPAC deal are expected to be $284 million from Tiga Acquisition Corp. with an additional $100 million from a forward purchase agreement.

The Raine Group LLC is serving as financial advisor to Grindr, and Cooley LLP is acting as legal advisor. Milbank LLP is acting as legal advisor to Tiga.

How much is Grindr worth?

Grindr is worth approximately $1.6 billion pre-SPAC and is estimated to be worth $2.1 billion once the deal is finalised. Typically, all SPAC stocks are priced at $10 initially, with additional warrants sold at $11.5 each. 

How to trade Grindr stock

Once the SPAC deal has been completed, you can trade Grindr in the same way as any other share on the market. Until then it will trade as Tiga Acquisition Corp.

In the meantime, choose from hundreds of global shares with City Index

  1. Open a City Index account, or log in if you’re already a customer
  2. Search for the company you want to trade in our award-winning platform
  3. Choose your position and size, and stop and limit levels
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Alternatively, if you’re not ready to trade live markets – but want to practice ahead of the Grindr listing – you can set up a free demo account to trade in a risk-free environment.

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What does Grindr do?

Grindr is an LGBTQ+ dating and networking app that sorts users’ personal profiles based on location proximity to their GPS location. The 100 nearest profiles are arranged in a grid and display additional information when selected. Users can send text messages and share photos, voice memos, video calls, and their precise location with one another.

In 2021 Grindr had 10.8 million monthly active users who spent an average of 61 minutes per day on the app, 80% of whom were under 35.

Grindr has made several forays into original content. In 2017 it launched a short-lived digital magazine, ‘INTO,’ that folded after 17 months. Next, Grindr released a miniseries titled ‘Bridesman’ released in-app and on YouTube in April 2022. It’s unknown if Grindr plans to pursue additional content streams.

How does Grindr make money?

Grindr makes money through in-app ads and tiered subscription services.

  • Grindr XTRA costs $19.99 per month and removes ads, allows users to view up to 600 nearby profiles at once, offers advanced filters when sorting through profiles, and other features
  • Grindr Unlimited costs $39.99 per month and provides all the benefits of Grindr XTRA plus an unlimited number of profiles users can view and additional chat features

As of December 2021, Grindr boasts 723,000 paying users, up 31.5% compared to 2020.

Grindr has gotten into hot water for selling location data to in-app advertisers. Although the company claims to have stopped in 2020 after several fines and investigations, including a $7 million fine by Norway; the Wall Street Journal reported in May 2022 that location data collected by Grindr on its users from 2017 to 2020 remains on the market.

A spokesman for Grindr, Patrick Lenihan, told the Wall Street Journal that Grindr has now sacrificed ad quality and received lower revenue since reducing the user data shared with marketers.

Is Grindr profitable?

Exact information on the profitability of Grindr is not available. The company reported revenue of $147 million and $77 million in EBITA in 2021, up 30% and 51% respectively from 2020. For 2022, the app predicts an increase in revenue growth between 35-40%.

Meanwhile, the annual sales and marketing costs of the app in 2021 were just 1% of the company’s revenue.

What is Grindr’s business strategy?

While neither Grindr nor Tiga Acquisition Corp. have spoken on specific plans for the future of the company, Tiga CEO Raymond Zage has stated that he sees the possibility for a “meaningful expansion of its monetisation within a continuously growing market.” Tiga and Grindr also seek to drive engagement and retention through improved user experience and attract new users through expanded offerings post-acquisition.

Grindr has stated it plans to use the funds generated from the SPAC deal to pay down debt and further grow its business. According to Grindr CFO Gary Hsueh, the Los Angeles-based company decided on a SPAC because of its “certainty” compared to traditional IPOs.

Who are Grindr’s competitors?

Grindr’s competitors include other popular dating apps such as Tinder, Hinge, and Bumble. All of which have experienced declining stock prices in the last year. Bumble is down 64% after going public in February 2021 at $76 per share, now trading around $27.

Match Group, which owns both Tinder and Hinge, is down nearly 50% compared to May 2021. Although the conglomerate claims roughly 100 million monthly users across its dating platforms, while Bumble averages 40 million and Grindr just 11 million.

Tinder, Hinge and Bumble all cater primarily to straight audiences. Other queer dating apps rivalling Grindr include HER, Lex and Feeld, which all focus primarily on lesbian women and queer or polyamorous users. Grindr meanwhile caters primarily to gay, trans and bisexual men.

Who owns Grindr?

Grindr has changed hands several times since its founding by tech entrepreneur Joel Simkhai in 2009. In January 2016 Grindr sold a 60% stake to the Chinese video game development firm Kunlun Tech Co Ltd., which later purchased the remainder of the company in January 2018.

However, by March 2018 the Committee on Foreign Investment in the United States informed Kunlun that its ownership of the app posed a national security risk. This halted Kunlun’s plans of an IPO for Grindr as the company began seeking a new buyer.

Two years after US regulators encouraged the divestiture, Kunlun sold its entire 98.59% stake to the US-based San Vicente Acquisition LLC for $608.5 million. The remaining 1.41% of the company was held by senior management and core employees at Grindr.

Once the SPAC has been completed, current Grindr equity holders will maintain about 78% of the company.

Grindr board of directors

Grindr has organised a majority LGBTQ+ identifying board of directors. The board will also include current CEOs of both Grindr and TAC, Grindr’s current chairman James F. Lu, and existing director J. Michael Gearon Jr. The following list includes the names of all members announced to remain on or join the board once the SPAC is complete:

  • James F. Lu – Chairman
  • Jeff Bonfote – Grindr CEO and Director
  • Raymond Zage – Tiga CEO and Director
  • J. Michael Gearon Jr. – Director
  • George Arison – Director
  • Daniel Baer - Director
  • Gary Horowitz - Director
  • Maggie Lower - Director
  • Nathan Richardson - Director
  • Meghna Stabler - Director

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