According to Match Group, the parent company that owns the dating app Tinder, bad financial results are the reason for its current CEO, Renate Nyborg — also the company’s first female CEO — being laid off as well as pulling back from metaverse/Web3-related R&D projects, which include the release of an in-app digital currency called Tinder Coins, as well as plans to roll out the “Tinderverse” after acquiring a video-AI and augmented reality company called Hyperconnect in 2021. However, Kim did say that Match Group would continue to monitor the Metaverse space but would rather wait for a better time to make a strategic entry into it.
Match Group CEO Bernard Kim announced the news in a letter to shareholders on Tuesday.
Prior to the announcement, Nyborg had planned for Hyperconnect to further develop its avatar-based “Single Town” experience as a way for Tinder users to meet and interact with one another in virtual spaces in the future.
In Kim’s letter, Match Group’s CEO didn’t give away the reasons for Nyborg’s departure, stating that Tinder “has not been able to realize the monetization success that we typically deliver” over the last few quarters.
“I believe a Metaverse dating experience is important to capture the next generation of users […] However, given uncertainty about the ultimate contours of the Metaverse and what will or won’t work […] I’ve instructed the Hyperconnect team to iterate but not invest heavily in [the] Metaverse at this time,” Kim said.
Whether this is a temporary stall or a more long-term policy is yet to be seen.
“After seeing mixed results from testing Tinder Coins, we’ve decided to take a step back and re-examine that initiative so that it can more effectively contribute to Tinder’s revenue… We also intend to do more thinking about virtual goods to ensure that they can be a real driver for Tinder’s next leg of growth and help us unlock the untapped power users on the platform,” he added.
“We’ll continue to evaluate this space carefully, and we will consider moving forward at the appropriate time when we have more clarity on the overall opportunity and feel we have a service that is well-positioned to succeed.”
The company reported a 12% year-on-year growth in total revenue in Q2 2022, reaching $795 million, alongside a $10 million operating loss due to impairments relating to its Hyperconnect acquisition.