Meet your new wingman — Match Group, the online dating and social discovery behemoth in charge of your dating life.

Match became a COVID beneficiary (and necessity for singles) and now, it could also benefit from two upcoming trends: reopening and a move towards “social discovery”.

How Match became the dominant dating company

Match Group is the largest online dating company in the world and owns many of the most popular dating (i.e. Tinder, Plenty of Fish, Hinge, etc.).

Match controls 60% of the dating app market — and it got there by creating and acquiring emerging dating apps:

• Incubated Tinder in 2012 — via Hatch Labs, a startup incubator run by Match Group
• Acquired Eureka in 2019 — creator of Pairs, a popular Japanese “marriage-matching” service, as part of Match’s expansion into Asia.
• Acquired Hinge in 2018 — the “anti-Tinder app” focused on long term relationships

But the one that got away (after several acquisition attempts) — BumbleBMBL

, is now its own publicly-traded company.

There’s only so many fish in the sea

With control of over half the market, Match can only expand so much further. While Match will benefit from the growth in the dating app market — which is expected to nearly double over the next 5 years — it’ll have to figure out other ways to grow.

The solution: Expanding beyond dating — into the “social discovery” market, the business of finding friends.

• Friend discovery is the fastest-growing category amongst social media apps according to a16z.
• 57% of teens (age 13-17) have met a new friend online according to Pew Research.

In Feb. 2021, Match acquired Hyperconnect, a South Korean social-media company, for $1.73b. While the market is still in its infancy, apps like Discord, Clubhouse and Reddit are proving out the demand for online connections.

For investors… COVID accelerated the adoption of online dating

Online dating became the go-to for most love-sick individuals. With the launch of new features like 1-on-1 video calling and online games/icebreakers, first-time Tinder users and ARPU (average revenue per user) surpassed pre-COVID numbers.

For Match, this led to a record amount of paid subscribers and a 17% increase in 2020 sales compared to 2019.

Looking past COVID: A pent-up demand in dating and socializing could further accelerate the use of dating apps. In March, Bumble forecasted a strong outlook for its dating app and a survey completed by investment bank Raymond James (via SA) also showed an anticipated increase in dating app usage.