WALL STREET JOURNAL - Investors are dumping Match amid ongoing litigation risk. Match's shares are down ~17% since the trial began in November. Investors are overestimating the risks. A litigation analyst for Bloomberg Intelligence recently predicted Match has a 75% chance of winning the case. A 2017 report from Barclays showed Tinder did $176M in revenue in 2016 and, as of the Q1 of 2017, had less than a fifth of the payers it has today. No one predicted how much money Tinder Gold would make. According to Barclays Tinder's management predicted $454M in revenue in 2018 and Rad $503M. Barclays landed in the middle at $485M, significantly below the $800M the app actually ended up generating that year. Rad predicted 2020 revenue to be $892M. Last year, the app made $1.4B for Match. The banks ultimately valued Tinder at $3B in 2017, while the plaintiffs argue it should have been worth $13B.The case is set to go to a jury in early December. For Match, the worst case scenario seems unlikely. The judge has already said valuations of dating companies today can't be taken into account.
Mark Brooks: Match Group didn't just buy Tinder. They bought Singlesnet, and OKCupid, and People Media, not to mention POF, to hit the home run with Tinder. Sam Yagan, Mandy Ginsberg, Amarnath Thombre and Shar Dubey, executed beautifully to allow Tinder to disrupt the market. (Full Disclosure: POF is a former client of Courtland Brooks, and I own Match Group stock)