OPW INTERVIEW - Mar 31 - Dr Eike Post founded IQ Elite, a dating site for smart folks, in 2010. I interviewed him to find out where IQ Elite is going now. - Mark Brooks
What is the USP of IQ Elite?
IQ Elite was established in 2010 as a matchmaking site that uses as the main matchmaking criterion not a personality test but an intelligence test.
Thus, we together with the SRH University Heidelberg developed an online IQ test to match users based on IQ. Our matchmaking is complemented by other psychometric tests, such as personality, emotional intelligence and love style test.
What is the track record of IQ Elite?
Since its inception in 2010 over 20 million people have taken psychometric tests on IQ Elite and over 8 million people have joined the site.
During this time many couples have told us about the love they found on IQ Elite, including getting married and forming a family.
What does a typical IQ Elite user look like?
The concept of IQ Elite seems to resonate more with the older generation, and thus our active users are mostly above 35.
In terms of geography users are primarily from France, Italy, Poland, Romania and Latin America.
Are you profitable?
Yes, we are profitable but at a low level. However, over the last 10 years around 1 million euro have been earned.
Unfortunately, revenue is slowly declining. This has to do with the fact that we do not have a comparable density of users as similar sites such as eharmony, eDarling and Parship.
Why do you want to sell to or partner with a larger player?
To be honest, after working on the company for almost 10 years, the team members would like to move on. Also, in order to become profitable we reduced our IT development team four years ago, and stopped improving the product. That means that our dating product, that is build on Python and React is not optimized, buggy and not mobile friendly.
Thus currently we are faced with the tough decision to either invest substantially into the product or merge with another player who already has an attractive product.
What sales prices are you looking to get?
It is hard to say: On the one hand we have over 8 million registered users, almost 150,000 monthly visitors and are profitable, so we were hoping to sell for at least half a million.
On the other hand, looking at other M&A transactions it seems that the price to revenue ratio in the dating industry is low. For example, eharmony, with a cumulative revenue of over 1 billion USD was apparently acquired for only 85 million USD. Also, our users and revenue have been declining.
For those reason, in an outright sale we would want to get just 250k euro so that we could pay back our investors, while in a partnership, we would be Ok with 100k euro upfront and an earn-out that depends on the future revenue. Interested parties can contact us at [email protected].
This post also appears on InternetDatingInvestments.com
