MeetMe, the social discovery platform, has just agreed to acquire If(we), a mobile tech company, for a total of $60 million. The acquisition is in line with MeetMe’s plans to expand its mobile product portfolio. If(we) is expected to provide enhanced scale for monetisation as well as higher profitability for the combined company.
If(we) is based in San Francisco. The company has rolled out two mobile products for meeting people since 2004 – Tagged and hi5. The apps are available in 15 different languages and span a community of over 100 countries. If(we) generated a total revenue of $44 million in 2016, an increase of 56% over Q4 2015. Mobile advertising revenue was up 93% during the same time.
Tagged has around 2.3 million mobile and hi5 has 5.4 million total monthly active users. On average, the apps register 18,000 new mobile users a day.
Dash Gopinath, Chief Executive Officer at If(we), said in a statement:
“When we met the team at MeetMe, we quickly realized that our missions are the same – helping people meet new people and solving the “Social Discovery” need for our users. We shared many of the same philosophies from a product, team, and vision perspective, and we both believe in the opportunity in dating/social, particularly around video. Together, we believe we can accelerate this for all our users. As part of MeetMe, if(we) will be able to leverage our combined expertise in Social Discovery to enhance our current products in meaningful ways. Our team will be able to focus on improving the core experience of Tagged/hi5 for all users, while exploring new formats such as videos to connect people.”
MeetMe plans to fully integrate If(we). This should result in a company with a combined mobile monthly active base of 10.6 million users. That’s a 28% increase for MeetMe. Daily active users will increase 40% from Q4 2016 to 2.8 million. In addition, MeetMe expects 65.3 million chats to be sent daily and to increase its mobile new users per day to 130,000.
Geoff Cook, CEO of MeetMe, added:
“We believe this combination provides a clear pathway to $150 million in annualized revenue with adjusted EBITDA of $50 million for our combined company. We are very excited to add If(we) and its flagship brands Tagged and hi5 to our portfolio of mobile apps for meeting and chatting with new people. If(we) brings a sizable global community, with strength in the US, to our portfolio. Their mobile apps are experiencing significant revenue growth and we expect that to accelerate in 2017 as we introduce our best practices around engagement and monetization. I am excited by the opportunity to work closely with If(we)’s talented team to accelerate growth and engagement across our portfolio of brands, which are aimed at meeting the universal need for human connection.”
The announcement comes on the back of MeetMe announcing a total revenue growth of 34% during 2016. MeetMe expects the deal to close in the second quarter of 2017.