OPW INTERVIEW - June 28
What inspired you to start Tingle?
I come from a background in building communication services. We owned a company seven years ago that was building rich communication services for feature phones. What we lacked was a community. Online dating is a community. It needs to be structured and curated like a community and I've always been interested in doing that.
How many members are you at?
Tens of thousands.
What's prevented you from growing faster?
We haven't really begun to market aggressively in the U.S. yet. It's taken us quite a bit of time to perfect the product.
So you're at the stage where you've got a nice app you're ready to roll. What would you do differently if you had to do it all again, in terms of the build?
It's unfair to be in 2012 looking at me in 2010. If there was one thing I would have done, that is wait until the technologies had matured.
What was the biggest challenge that would have been fixed if you'd done it 6 months ago, in terms of the development and the environment?
Very, very subtle things in iOS have been problematic and solved in more recent builds. A good example is linking to states within applications. What we did was build all of this incredible state tracking technology which is now completely unnecessary, but may be useful down the road when we go to other platforms like Blackberry and Android.
State tracking? What does that mean from the user perspective?
Our application sends a lot of notification to the users every day about various things that are happening. Without some sort of state tracking you cannot determine what action the user is responding to. That technology wasn't supplied by Apple until probably just before iOS 5.
What platforms are you running on?
Everything iOS. iPhone, iPad, iPod Touch.
You've not done Android yet? Why?
We didn't mature our API until about February time frame, so the Android project is just about to kick off.
Do you want to do Android?
What's your thoughts on HTML5 apps?
LinkedIn recently revealed that they've built their app on HTML5. Why is it not a good fit for the internet dating sphere?
For our app, which I think is pretty unique in the industry, I just don't see how it's feasible for us to sustain some of the things that give us a competitive advantage.
What's your most unique couple of features?
Tingle's the only app I'm aware of in the straight dating market that lets people talk to each other on the phone completely anonymously.
Why aren't the apps offering this essential service? What's the difficulty?
Two things. The technology is kind of hard to do. I come from the VOIP industry. I'm one of the innovators that got that technology off the ground when I was working at Cisco in the nineties. The second thing is more social. I don't think that most dating services are designed to confront the spam issue. If you were just to layer voice communication, then you're inviting phone calls at random hours of the day, perhaps dozens of phone calls from complete strangers every single day. So we've worked really hard on technologies and systems developed to condition that signal to noise ratio. So that when you add the calling feature and the other features down the road, you're not just creating more opportunity for disturbance.
How does the handshake work when a guy wants to talk to a woman?
If I see a woman I like, I send her a wink. Until she accepts my wink, I can't send her a message or call her. If she accepts my wink then we're connected. Then we can talk and get to know each other. And if we go out on a date and things don't work out, she can just block me.
Can she revoke certain forms of communication or is it a hard stop?
It's a hard stop right now.
So you've got the voice piece, which is fantastic. Did you build it entirely with your own people or did you use a third party?
We've leveraged a mix of third party and in house technologies.
So I want to build a mobile dating app, let's say, and I don't want to include voice, what am I going to spend? What should I be budgeting?
What we've built, with voice of IP and all that, it was well north of a million dollars. If you want to build a lightweight hook up app, that's something two or three guys with some inspiration could do in two to three months.
So basically $30,000 to $1,000,000?
So what tech is Tingle built on?
Tingle's back-end is mostly Rails and some bigger iron software on the server side. The native stuff on the client side is Objective C right now on iOS. It will be native on Android. And native on Blackberry if they don't die first.
If you had to build it again, would you change that?
No. Well, one thing worthy of consideration is Ruby on Rails. Rails was a great filter, because I wouldn't have to interview as many PHP guys. There are benefits to PHP as well. I think it's a trade-off between a good Symphony based PHP deployment and Ruby on Rails. I always say the real benefit of PHP would have been integration with WordPress.
What other technologies did you consider and reject? And why did they not make the cut?
We would never go .Net because I don't want online error. We are a bunch of guys with laptops and hosted services. At the moment, we spend a lot less than $500 per month to host tens of thousands of users, which is awesome economics.
Who do you use for hosting?
A mixture of third party services. Everything we use is VPS. So we have VPS service with Linode. We use some other facilities with Amazon, EC2 and AWS.
How are you making money?
We are generating a fairly healthy trickle of revenue just from our open beta users. These are people purchasing prepaid credits which they use to talk.
So you're credit based? It's not monthly?
It's not subscription and it's not pure advertising.
How do you feel about giving Apple 30%?
Apple does us a lot of favors, so for now I'm content to let them take their cut. When we're on Android, the fees are significantly better.
How will you play it on Android?
We'll probably handle transactions on our own and not use the Android payment process. We actually set that up a long time ago with Optimal Payments and integrated our technologies. It's locked and loaded and ready the second we're up on that platform.
How have you handled the geo-location?
They are very unsophisticated and largely derivative of the gay dating apps that came along. It does not apply to the straight market.
The thing that's really interesting for both men and women about location based discovery is serendipity. It doesn't matter that a woman is in a specific coffee shop or restaurant that I'm by, it just matters that she's in the area. We created a notification based location based discovery system “Radar”. Radar passively tracks location updates from within the operating system. When we find people near each other, we then pass that through the search filters that they have set up.
What's a wink cost?
Winks are always free. Calls and messages are paid. You can earn the credits that you would spend when you call or text people. Our hardline exchange rate is about 150 credits to the dollar.
The “women are free” model is something we're very cognizant of and that's a major driver for the industry. We discovered that women who actually buy subscriptions and go after guys that they are interested in are generally more happy with the experience. In our model, it's free to reply to a call or message from another person.
Have you thought about incentivizing replies?
Yes, we think about it a lot but it's a little like prostitution. We definitely don't want to encourage those types of users in our community.
How did you get to the first 10,000 users?
We host parties. A party in L.A. will draw between 2,500 and 5,000 sign-up’s if executed well.
Where's the next one?
Probably in L.A., and we're going to do some parties this summer in Miami, New York, Toronto, Calgary, and L.A.
What's your hurdle for seeding per new member? What are you willing to spend?
Not more than $7, and we never have.
Once you're at critical mass, what's your hurdle rate for the conversions and CPA now that you're over 10,000?
The virality kicking in will have a nice effect on our overall CPA. My rule of thumb is that I won't spend over $7, but in general we're spending between $4 and $5.
Virality is super important right? What's the keys?
For me, the key is to show how you're different from everything else that's out there in a consumer perspective.
A big hook in your case is that you've got a stellar name.
The brand's OK. I wasn't very comfortable about it at first, but I've gotten there.
We've gotten some push-back from folks who think tingle is a negative connotation. For me it was always about the tingle, the butterflies in your stomach.
So you licensed the name or bought it?
We bought it and we're in the process of trademarking it.
Let's talk about growth. Have you had $200,000 to spend and you had to spend it next week, where would you put it?
I would throw it at my most effective third party lead generation tool, which right now probably looks like Facebook.
It's nice that it's one platform that's got decent volume. Have you tried any affiliate networks?
Actually, we haven't done any affiliate. We have a project to get that going but it's just not our focus right now.
Do you think there will be an internet dating site for Tingle.com or is it always going to be a mobile app?
It will always be mobile.
We want users to feel connected all the time.
Are there any user behaviors that have surprised you as you have observed your membership?
The proximity of people and the tendency for people to pass nearby each other is really inspiring.
It also shows that people want mobile and that's the future of internet dating – lose the internet.
Yes. And Markus Frind has said exactly that. But I think the impact of mobile is a lot more cutting than most people think at the moment. Markus seems to get it. He said that 60-70% of his users are going to be mobile by the end of 2012 and he essentially said his business model is invalid in that sense.
If you were buying and you could acquire any three mobile dating companies, which three would you choose?
Obviously the best mobile dating companies are all gay dating apps.
Who else do you think has done very well with a mobile dating service?
It's hard to say. In the gay market, the service model is well established and the guys have done well. In the straight market, I guess on the top of the list of companies to go after would be us.