🐝 Bumble's IPO pop

Friday, February 12, 2021 by Robinhood Snacks | Disclosures

Bumble's date with the Nasdaq

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Hey Snackers,

Perfect Valentine's Day meal for homebodies: 3D rib-eye, fresh out of the steak printer. Sooo much tastier than the '90s Epson black-and-white fillet.

Stocks closed at record highs again, boosted by a string of positive earnings. Bitcoin also soared to a record after BNY Mellon announced a new crypto unit.

PS: The market is closed on Monday for Presidents Day (aka: Washington’s Birthday) — so we'll be back in your inbox on Tuesday.

IPO
1. Bumble goes on the market just in time for V-Day (but don't call it a dating app)

Love at first swipe... More like: love on first trading day. Bumble saw its stock pop as much as 80% during its first day as a public company (#romantic). Shares of the female-focused dating app closed the day up 64% from their IPO price. And Bumble's 31-year-old founder and CEO Whitney Wolfe Herd became the youngest woman to ever take a company public. Women are Bumble's competitive advantage, in more ways than one:

  • Women make the first move... In North America, Bumble has ~30% more female users for every male user compared to the gender mix of users in the freemium dating market.
  • Women make the cash move... A higher percentage of Bumble’s female users become paying customers than the market average.
  • Not just Bumble: Bumble also owns European dating app Badoo. Between the two, Bumble has ~42M monthly users and 2.4M paying users.

But don't call it a dating app... Bumble prefers "preeminent global women's brand." In addition to Bumble Date: it also offers Bumble Bizz for career networking (think: swipeable LinkedIn), and Bumble BFF to connect with new friends (without benefits).

THE TAKEAWAY

Bumble wants you for life... not just for your "single and ready to mingle" stage. It's a notably different strategy than Match Group's Hinge, which calls itself "the app that's designed to be deleted." To provide lifetime value post-DTR, Bumble is expanding into platonic categories. It's even planning to monetize BFF, Biz, and "other potential new categories." We're thinking "Bumble Bark" for dog-lovers.

BHM

Like tech Twitter, for audio... Nightmare fodder. Buzzy audio-based social network Clubhouse recently raised cash at a reported $1B valuation, 10X its valuation in May. Back then: the invite-only app had just 1.5K users and was almost exclusively filled with early investors, their friends, and tech bros. In less than a year, it has gained 5M users, mainstream appeal, and a potential Facebook copycat. That’s largely thanks to its community of Black users:

  • Since July, Clubhouse’s Black community has grown significantly. Black people are driving conversation through interest-focused clubs and community events. Think: Black in Tech, Black Beauty Club, and Black Bitcoin Billionaires.
  • Black artists have been major growth drivers, with stars like Drake, Meek Mill, 21 Savage, and Tiffany Haddish hosting chats. Performances organized by Black creators, like the Clubhouse-rendition of The Lion King, have boosted downloads and maxed out chat “room” capacities. Highlighting the importance of Black artists to the platform: Clubhouse’s logo recently featured musician Bomani X, the host of a music-focused room on the app.

Pull up the stats... Clubhouse isn’t the only social app whose growth was propelled by Black communities. In the early stages of Snapchat, Vine, and Dubsmash, Black people were overrepresented in usage — fueling mainstream adoption by making these apps cool, creative, and relevant. “Communities of color drive the cultural conversation and a lot of the initial wealth creation for apps like Clubhouse,” according Mercedes Bent, partner at Lightspeed Venture Partners. While Black communities drive growth, they don’t reap its financial benefits as much. That’s partly a result of:

  • Unequal access to funding: From 2015 to 2020, Black and Latinx founders raised ~$15B, just 2.4% of the total venture capital raised during that period.
  • Lack of diversity in VC: Today, only 2% of decision-makers at VC firms are Black. And in 2018, just 4% of VC employees were Black.
THE TAKEAWAY

Gatekeepers are key to greater inclusion... That's why VC firms like Andreessen Horowitz and SoftBank have created funds geared towards BIPOC entrepreneurs. But VCs aren’t the only drivers of change: barriers to inclusion appear at much earlier stages than the VC pitch room, preventing people from becoming entrepreneurs in the first place. That includes the massive racial wealth gap, which limits access to loans, capital, and educational opportunities that drive innovation.

What else we’re Snackin’
  • Yoda: Disney says it now has nearly 95M Disney+ subscribers (aka: half of Netflix), up from ~74M last quarter.
  • Crunchy: Pepsi's quarterly sales jumped 9% as demand for Cheetos, Tostitos, and Quaker Oats offset weak soda sales (#StressSnacking).
  • Faschund: Secondhand marketplace Poshmark launches a pets section, so you can buy a turtleneck for your dachshund.
  • Vax: CVS and Walmart are prepping to dispense Covid vaccines to the public nationwide.
  • Chipper: President Biden is planning to sign an executive order to help US carmakers address the global chip shortage.
  • Why: Microsoft reportedly tried to buy Pinterest in an (unintuitive) move to fuel its cloud expansion.
Snacks Daily Podcast

Flying taxi startup Archer is going public with backing from United Airlines... and other travel companies that it's trying to disrupt.

Tune in to hear why OG companies are keeping their friends close, and their enemies funded.

Friday
  • Earnings expected from Dominion Energy

Authors of this Snacks own shares of: Disney, Walmart, Match, and Microsoft

ID: 1523238