WeChat is far and away the messaging platform that is biggest in China at present, and that’s assisting to drive a push on the list of smaller players to obtain together for better scale. Today, Momo, the Chinese location-based social network application which includes recently made a huge push into online dating services and it is exchanged on Nasdaq with an industry cap of approximately $6 billion, announced so it has obtained Tantan, ChinaвЂ™s top dating application, for вЂњapproximately 5.3 million newly given Class the ordinary stocks associated with the business and US$600.9 million in cashвЂќ.
ItвЂ™s not yet determined exactly exactly how that cost comes even close to TantanвЂ™s pre-exit valuation: it had never disclosed the amount. Overall, Tantan had raised $120 million, including a $70 million round just last year from a mix of strategic and economic investors. Its backers included Kleiner Perkins, movie network that is social, Genesis Capital, SAIF Asia, Zhongwei, DCM and Bertelsmann.
WeвЂ™d actually heard rumors of the purchase recently, so that itвЂ™s perhaps not coming as a surprise that is complete.
WeChat has you might say written the playbook in Asia for just how to leverage a favorite platform that is social transfer to other related solutions (commerce being one of many biggies), and 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 move into transport.
For the component, Momo was in fact stepping into streaming solutions but with federal government stress within the content of the solutions, planning to its dating roots may have thought such as for instance a safer bet for the time being. 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 its prospects up.
Certainly, the companyвЂ™s stock is currently up 14 per cent to date trading when you look at the wake regarding the news.
Especially, the offer will certainly provide Momo a boost that is big its very own relationship business. Tantan stated so it has enabled 5 billion matches since releasing in 2015. (As a spot of comparison, Tinder вЂ” one of many leading dating apps in the West вЂ” claims that its enabled at the least 8 billion matches since its launch in 2012.)
This will not signal a change for Momo into dating exclusively (sorry for the pun), but to increase down using one associated with the more ways that are successful it is diversified its business.
вЂњOur core place continues to focus on social media and also this acquisition Sioux Falls escort service enriches our manufacturer product line into the social area,вЂќ said Yan Tang , chairman and CEO of Momo, in a declaration. вЂњWe continues to spend and incubate more sub-brands to serve the social and entertainment requirements of different demographics. Tantan is actually more popular within a brief amount of three years since its inception, which will be mainly owing to the outstanding performance of its skilled group. We also respect TantanвЂ™s product strategy that centers on the client experience of female users. Following the purchase, the Tantan team continues to operate the mobile apps underneath the Tantan brand with this complete help .вЂќ
Certainly, you can view this as just like the strategy taken by IAC, which operates range dating apps alongside Tinder, such as Match.com and OKCupid.
For Tantan, the offer can give the ongoing business not merely a financing boost but possibly some economies of scale in its designer backend as well as other aspects of its company. вЂњMomo and Tantan have actually their particular talents inside their particular areas and among targeted customers,вЂќ said Yu Wang , c hairman and CEO of Tantan, in the very own declaration. вЂњThe purchase is a crucial strategic update to pay for a larger selection of individual demographics and requirements, and establish a bigger social media market through complementary organizations and synergy that is strategic. We have been extremely confident within our development that is future.
Extra reporting by Jon Russell.
Up-date: DST got in contact in might 2020 to state this had not been an investor in Tantan from the above story as we and others reported previously, and so weвЂ™ve removed it.