With close to 4,000 online dating businesses in the market (including 19-year-old pioneer Match, with nearly 2 million dues-paying members) and industry revenues growing at a modest 3.5 percent annually, startup-minded entrepreneurs might not think online dating sounds like a match made in heaven for them.
Then again, the industry pulls in an eye-opening $2 billion a year, according to market research firm IBISWorld. What smart entrepreneur wouldn't want a piece of that action?
Add in the opportunity to innovate with smartphone dating apps, and it's easy to see why a new wave of entrepreneurs hopes they can beat the established firms to the next dating bonanza.
Love at First Site
One new dating app that's getting a lot of buzz is Tinder. This app presents users with photos of prospective matches found on Facebook and lets them signal interest—or lack thereof—with a simple and demonstrative swipe. A swipe to the right is a thumbs-up; left means better luck next time. This free app is available for Android and iPhone devices and requires a Facebook account.
Lulu is another Facebook-centric app, but for females only. Users can post written descriptions of male friends—sort of like a Yelp for men. The reviewees may be guys they know on Facebook or men who've downloaded the Lulu app in hopes of getting positive reviews. Males can read their own reviews and, if they don’t like what they read, opt out of participating. It’s free for Android and iPhone users.
A clear difference exists between relatively lightweight dating apps like these, which could perhaps be better described as flirting apps, and a website like eHarmony, which uses a 400-word questionnaire to try to match suitable mates. But not every dating app takes the superficial approach to matchmaking.
Instamour is a Philadelphia-based startup that aims to bring more depth to dating apps by incorporating video into every profile. CEO Jason Sherman says video profiles give users who are serious about finding a significant other far more information about prospective dates than static photos and written descriptions.
“Now you can see and hear the person before you meet,” Sherman says. “And you’re going to see a wide range of things like their smile and their surroundings and what their voice sounds like.” In addition to video profiles, Instamour employs real time chat and phone-to-phone video calling in an effort to help romance-seekers reduce the number of unproductive dates they go on by providing them with as much information on prospects as possible ahead of time.
For now, Instamour is free for iPhone and Android users, but it's planning to add a $0.99 premium version with extra features later this year. Sherman says there are many opportunities for monetizing dating apps, including freemium models, but first they need a sizable user base. Four months after launch, Instamour has a five-figure user base and is growing at 200 percent a month, Sherman says.
First Date Jitters Eliminated
Of course, identifying a prospective dating partner is just part of the problem. Another is coming up with something enjoyable to do on the first date.
Currently, singles spend $82 billion a year on dating-related activities, according to Match. Helping them spend those dollars wisely is where apps like Delightful come in. The San Francisco-based company connects users to an online concierge, arranging memorable dates for a flat fee of $12 per month. At just six months since launch, the company is still in the early days of building a user base.
Some of Delightful’s curated outings sound like they could live up to the company name. What about a wine tour of the Napa Valley behind the wheel of a high-performance and environmentally conscious Tesla electric sports car? Or a behind-the-scenes tour of a museum on Golden Gate Park? Co-founder Chris Ling says most of the company’s customers are active single daters or couples in committed relationships looking for something special to liven up date night.
Delightful’s online concierges can customize a date almost any way they’d like, according to Ling. And they handle details few daters would even think of, like pre-ordering drinks for theater- and concert-goers so they can be served immediately when an intermission starts, helping a couple avoid a long wait in line.
The cost of a typical Delightful date ranges from about $100 to $250, Ling says. The company makes money from membership fees as well as revenues received from restaurants and other businesses. The model is similar to a daily deals site, Ling says, but Delightful doesn’t require vendors to offer steep discounts in hopes of creating long-term marketing partners rather than one-shot promotions.
So far, Delightful is only available in San Francisco and only for iPhone users. Ling says adding additional metro areas is currently under discussion.
In addition to these saucy newcomers, established dating sites like InterActive Corp.'s Match and OkCupid as well as independent heavyweight PlentyOfFish also have dating apps that tie in with their websites. But no matter how many dating app ideas entrepreneurs have, they remain confident there's always room for more.
As Sherman puts it, “We’re solving an age-old problem.” And who couldn't use a little assistance in the love department?
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Photos: Thinkstock, Tinder, Delightful