how-does-bumble-make-money

How Does Bumble Make Money? The Bumble Business Model In A Nutshell

Bumble is an American social media company with a core focus on online dating. Bumble drives revenue through the purchase of in-app services using its currency Bumble Coins and via subscriptions. Bumble generates revenues in a few key ways: Spotlight is Bumble’s answer to Tinder’s Boost capability. The Bumble Boost function allows users to swipe without daily limits or extend matches for up to 48 hours.

Origin Story

Bumble is an American social media company with a core focus on online dating. The company was founded by Whitney Wolfe Herd, a former Tinder user who sued the platform for sexual discrimination and harassment in 2014.

As a result of media attention surrounding the case, the founder of the Russian dating app Badoo Andrey Andreev reached out to Heard. He proposed a new dating app using Badoo infrastructure and investment funds.

Together, Heard and Andreev recruited fellow Tinder departees Sarah Mick and Chris Gulczynski to design the Bumble interface ready for launch in December 2014.

Bumble has since expanded to become more than just a dating app. Bumble BFF allows users to search for platonic friends, while Bumble Bizz focuses on business communication.

In 2020, the platform reached 100 million users and is the second most popular platform in the U.S. after Tinder.

Understanding Bumble value proposition

In its financial prospectus, Bumble highlighted:

Bumble was founded because we noticed two different, yet related issues in our society: antiquated gender norms, and a lack of kindness and accountability on the internet. We observed that women were often treated unequally in society, especially in romantic relationships. At the same time, social networks created possibilities for connections, but they were focused on connections with people you already know and lacked guardrails to encourage better behavior online.

Thus, as the company highlighted, the brand was built with “women at the center.”

The Bumble tech platform emphasizes a design “to be safe and empowering for women, and, in turn, provides a better environment for everyone.”

Therefore, as the company highlights, the value proposition moves along a few key values:

  • Meaningful Connections and Healthy Relationships.
  • Trust and Safety.
  • Innovative Features.
  • A Large, Growing, Engaged Community.

Understanding the Bumble tech platform and product

The company operates two main products:

  • Bumble: launched in 2014, is one of the first dating apps built with women at the center. 
  • And Badoo: launched in 2006, one of the pioneers of web and mobile free-to-use dating products.
LOGO
The Bumble Timeline (Image Source: Bumble Financial Prospectus)

The users’ experience consists of three main paths/journeys:

Setting Up a Profile

LOGO
The platform has been designed to enable a straightforward setup and interaction.
(Image Source: Bumble Financial Prospectus).

Matching

LOGO
The matching experience is a distinctive element of the platform, and it’s engineered to empower women in the choice of a potential match.
(Image Source: Bumble Financial Prospectus).

Chatting

LOGO
Bumble’s users must initiate a chat within 24 hours, or the connection disappears.
(Image Source: Bumble Financial Prospectus).

Premium Features

Bumble subscription offerings (Bumble Boost and Bumble Premium) enable a set of premium features like:

  • Beeline: a feature that shows you who likes you.
  • Rematch: enabling subscribers to rematch with any prior matches that have already expired after 24 hours.
  • Extend: access to an unlimited number of 24-hour extensions on conversations.

Other features can be enabled as in-app purchases:

  • SuperSwipe: to inform potential matches that they are confidently interested in them.
  • Spotlight: to advance their profile to the top of the list of potential matches.
  • Travel Mode: change location to anywhere in the world (thus opening up to new matches).
  • Backtrack: enabling users to undo a “no” vote to revisit potential matches.

Bumble revenue generation

It’s important to point out that the core features of Bumble are free to use. Users can swipe and match with interested parties without having to pay for the privilege.

Instead, Bumble drives revenue by purchasing in-app services using its currency, Bumble Coins.

Spotlight

Spotlight is Bumble’s answer to Tinder’s Boost capability.

Users can pay to have their profiles placed at the front of a match queue using Bumble coins.

The coins are available for purchase within the app, with pricing depending on the user’s country and the number of coins purchased.

In general, Bumble offers discounts for bulk purchases. In the United States, for example, 1 Bumble Coin costs $1.99, while 20 Bumble Coins can be had for $24.99.

Boost

The Bumble Boost function allows users to swipe without daily limits or extend matches for up to 48 hours. They can also instantly access those who have liked their profile and re-match with old connections.

Boost features are also purchased with Bumble Coins but more frequently. Using a subscription-based model, users can sign up to Boost for a week, month, three months, or a lifetime.

Again, prices depend on the region and the renewal frequency chosen. But Bumble can charge up to $25/month for this premium membership.

Badoo ownership

In 2020, Bumble replaced MagicLab as the parent company of both Bumble and Badoo.

Therefore it is not unreasonable to suggest that Bumble makes a significant amount of money from Badoo – which is also a popular dating platform with a similar business model.

Badoo is the world’s most widely used dating network, operating in 190 countries with hundreds of millions of registered users.

Key takeaways:

  • Bumble is a social media dating company co-founded by former Tinder user Whitney Wolfe Herd and Badoo founder Andrey Andreev.
  • The Bumble app works on a freemium model. However, users can unlock additional features using Bumble Coins, either through one-off purchases or a subscription model.
  • In 2020, Bumble also became the parent company of Badoo – the world’s most popular online dating service with a similar business model.

Main Free Guides:

Related Business Model Types

Platform Business Model

platform-business-models
A platform business model generates value by enabling interactions between people, groups, and users by leveraging network effects. Platform business models usually comprise two sides: supply and demand. Kicking off the interactions between those two sides is one of the crucial elements for a platform business model success.

Marketplace Business Model

marketplace-business-models
A marketplace is a platform where buyers and sellers interact and transact. The platform acts as a marketplace that will generate revenues in fees from one or all the parties involved in the transaction. Usually, marketplaces can be classified in several ways, like those selling services vs. products or those connecting buyers and sellers at B2B, B2C, or C2C level. And those marketplaces connecting two core players, or more.

Network Effects

network-effects
A network effect is a phenomenon in which as more people or users join a platform, the more the value of the service offered by the platform improves for those joining afterward.

Asymmetric Business Models

asymmetric-business-models
In an asymmetric business model, the organization doesn’t monetize the user directly, but it leverages the data users provide coupled with technology, thus have a key customer pay to sustain the core asset. For example, Google makes money by leveraging users’ data, combined with its algorithms sold to advertisers for visibility.

Attention Merchant Business Model

attention-business-models-compared
In an asymmetric business model, the organization doesn’t monetize the user directly, but it leverages the data users provide coupled with technology, thus having a key customer pay to sustain the core asset. For example, Google makes money by leveraging users’ data, combined with its algorithms sold to advertisers for visibility. This is how attention merchants make monetize their business models.

Wholesale Business Model

wholesale-business-model
The wholesale model is a selling model where wholesalers sell their products in bulk to a retailer at a discounted price. The retailer then on-sells the products to consumers at a higher price. In the wholesale model, a wholesaler sells products in bulk to retail outlets for onward sale. Occasionally, the wholesaler sells direct to the consumer, with supermarket giant Costco the most obvious example.

Retail Business Model

retail-business-model
A retail business model follows a direct-to-consumer approach, also called B2C, where the company sells directly to final customers a processed/finished product. This implies a business model that is mostly local-based, it carries higher margins, but also higher costs and distribution risks.

B2B2C

b2b2c
A B2B2C is a particular kind of business model where a company, rather than accessing the consumer market directly, it does that via another business. Yet the final consumers will recognize the brand or the service provided by the B2B2C. The company offering the service might gain direct access to consumers over time.

Crowdsourcing Business Model

crowdsourcing
The term “crowdsourcing” was first coined by Wired Magazine editor Jeff Howe in a 2006 article titled Rise of Crowdsourcing. Though the practice has existed in some form or another for centuries, it rose to prominence when eCommerce, social media, and smartphone culture began to emerge. Crowdsourcing is the act of obtaining knowledge, goods, services, or opinions from a group of people. These people submit information via social media, smartphone apps, or dedicated crowdsourcing platforms.

Open-Core Business Model

open-core
While the term has been coined by Andrew Lampitt, open-core is an evolution of open-source. Where a core part of the software/platform is offered for free, while on top of it are built premium features or add-ons, which get monetized by the corporation who developed the software/platform. An example of the GitLab open core model, where the hosted service is free and open, while the software is closed.

Open Source vs. Freemium

open-source-business-model
Open source is licensed and usually developed and maintained by a community of independent developers. While the freemium is developed in-house. Thus the freemium give the company that developed it, full control over its distribution. In an open-source model, the for-profit company has to distribute its premium version per its open-source licensing model.

Freemium Business Model

freemium-business-model
The freemium – unless the whole organization is aligned around it – is a growth strategy rather than a business model. A free service is provided to a majority of users, while a small percentage of those users convert into paying customers through the sales funnel. Free users will help spread the brand through word of mouth.

Freeterprise Business Model

freeterprise-business-model
A freeterprise is a combination of free and enterprise where free professional accounts are driven into the funnel through the free product. As the opportunity is identified the company assigns the free account to a salesperson within the organization (inside sales or fields sales) to convert that into a B2B/enterprise account.

Franchising Business Model

franchained-business-model
In a franchained business model (a short-term chain, long-term franchise) model, the company deliberately launched its operations by keeping tight ownership on the main assets, while those are established, thus choosing a chain model. Once operations are running and established, the company divests its ownership and opts instead for a franchising model.
Scroll to Top
FourWeekMBA