Match Group, parent company to Tinder’s popular dating app, has announced that it will reduce funding for Web3-related research, development, and analysis amid disappointing Q2 earnings, and the departure Tinder’s current CEO.
Match Group CEO Bernard Kim announced in a letter to shareholders that the company will reduce its Metaverse investments and scrap plans to create an in-app virtual currency called Tinder Coins.
This move comes along with Renate Nyborg’s resignation as Tinder CEO. Renate Nyborg was the first woman to lead the company after it acquired Hyperconnect, a video-AI company and augmented reality company.
Nyborg planned to use Hyperconnect to develop its avatar-based Single Town experience. This will allow Tinder users to interact in virtual spaces.
Kim didn’t explicitly mention the reasons Nyborg left, but he said that Tinder had not achieved the monetization success it usually delivers in the last few quarters.
Kim stated in his letter that Match Group would continue to monitor the Metaverse space, but that it would prefer to wait until the “appropriate moment.”
“I believe that a Metaverse dating experience is important to capture users But, due to uncertainty over the final contours of the Metaverse […] I have instructed the Hyperconnect team not to invest heavily in [the] Metaverse at the moment.
Kim revealed that plans to create an in-app virtual currency called Tinder Coins were also scrapped due to mixed results from testing.
“After seeing mixed results with Tinder Coins testing, we decided to step back and reexamine the initiative to see if it can contribute more effectively to Tinder’s revenues.”
He said that virtual goods are also important to Tinder’s future growth. This will allow them to unlock the power of the platform users.
Similar: Looking for a compelling use case to privacy blockchains? Dating is the perfect example of a compelling use case for privacy blockchains.
“We will continue to assess this space and consider moving forward when we have more clarity about the overall opportunity and feel that we have a service that is well placed to succeed.”
The company reported a 12% increase in total revenue year-over-year to $795 million in Q2 2022. A $10 million operating loss was also recorded due to impairments related to Hyperconnect.
Match Group stock has fallen 11.39% in the past five days, to $63.24 as of this writing