WeChat is way and away the greatest messaging platform in China for the time being, and that is helping to pressure a push among the smaller gamers to social gathering for enhanced scale. these days, Momo, the chinese language region-based mostly social networking app that has more recently made a big push into relationship functions and is traded on Nasdaq with a market cap of round $ 6 billion, announced that it has got Tantan, China’s top courting app, for $ 600.9 million in an all-cash deal.
It’s now not clear how that expense compares to Tantan’s pre-exit valuation: it had not ever disclosed the number. normal, Tantan had raised $ one hundred twenty million, together with a $ 70 million circular closing year from a mixture of strategic and economic traders. Its backers blanketed DST global, Kleiner Perkins, video social community YY, Genesis Capital, SAIF China, Zhongwei, DCM and Bertelsmann.
We’d really heard rumors of this acquisition currently, so it’s not coming as an entire surprise.
WeChat has in a way written the playbook in China for a way to leverage a well-liked social platform to stream into different linked features (commerce being one of the crucial biggies), and it appears that could-be rivals are following go well with. different first rate strikes and exits in recent years have covered Alibaba buying Youku Tudou and additionally investing closely in WeChat competitor Weibo; selfie-making app Meitu going public and Meituan Dianping making a circulate into transportation.
For its half, Momo had been moving into streaming features but with government power over the content material of those services, going to its courting roots may additionally have felt like a safer guess for now. The enterprise remaining year mentioned just beneath ninety five million monthly clients however with a susceptible outlook, so this can help it bump up its possibilities.
specifically, the deal will certainly provide Momo a big increase in its own courting business. Tantan observed that it has enabled 5 billion fits in view that launching in 2015. (As a point of assessment, Tinder — one of the main courting apps in the West — says that its enabled as a minimum 8 billion fits for the reason that its launch in 2012.)
This doesn’t sign a shift for Momo into dating exclusively (sorry for the pun), however to double down on one of the crucial extra a success ways in which it’s different its enterprise.
“Our core place will proceed to core on social networking and this acquisition enriches our product line within the social area,” spoke of Yan Tang, chairman and CEO of Momo, in an announcement. “we will proceed to invest and incubate more sub-brands to serve the social and amusement needs of distinct demographics. Tantan has become extensively identified within a short period of three years on account that its inception, which is largely attributable to the spectacular performance of its talented team. We additionally respect Tantan’s product strategy that focuses on the consumer experience of female clients. After the acquisition, the Tantan crew will continue to function the cellular apps under the Tantan company with our full support.”
indeed, that you may see this as comparable to the strategy taken through IAC, which operates a few dating apps alongside Tinder, reminiscent of in shape.com and OKCupid.
For Tantan, the deal will give the enterprise no longer only a funding raise but probably some economies of scale in its developer backend and other areas of its company. “Momo and Tantan have their personal strengths of their respective markets and among targeted purchasers,” stated Yu Wang, chairman and CEO of Tantan, in his own remark. “The acquisition is a crucial strategic upgrade to cowl a more advantageous latitude of user demographics and wishes, and build up a larger social networking market through complementary businesses and strategic synergy. we are very confident in our future building.”
extra reporting by means of Jon Russell (not this Jon Russell).
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