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Two out of three for matchmaker, Bumble

July 7, 2022
BMBL 1 | Quentinvest

Too early for.a Coppock signal but we have a two out of three with the moving averages turning higher and a trend line break for a classic 3G stock making shares in matchmaker, Bumbl, a buy. The exciting bit of Bumble is the Bumble App launched in 2014. Growth has been dramatic and was still continuing when the group last reported in May.

The shares have been all downhill until recently because the company floated at a time of high optimism and super low interest rates and have been carried lower by the savage bear market that has been in force for much of the time since the IPO.

Bumble was founded by Whitney Wolfe Herd who is still just 33 years old. Prior to founding Bumble she was the Vice President of marketing at Tinder.The importance of Wolfe Herd to the dating industry in the US and globally can be seen from the fact that Tinder and Bumble are the largest and second largest US dating apps.

Part of the secret sauce of Bumble is that it is aimed at women who are the only ones who can initiate a date on the app.

“We created Bumble app to change this. The Bumble brand was built with women at the center—where women make the first move. Our platform is designed to be safe and empowering for women, and, in turn, provides a better environment for everyone. We are leveraging innovative technology solutions to create a more inclusive, safe and accountable way to connect online for all users regardless of gender.

Bumble’s mission is to create a world where all relationships are healthy and equitable. Our platform enables people to connect and build healthy and equitable relationships on their own terms. We believe there is a significant opportunity to extend our platform beyond online dating into healthy relationships across all areas of life: love, friendships, careers and beyond. By empowering women across all of their relationships, we believe that we have the potential to become a preeminent global women’s brand..”

Prospectus, February 2021

The success of the business is all about technology.

“Technology is at the core of what differentiates our platform. We have a global team of software engineers and product managers who drive the development of our platform. We release live updates rapidly, often once a week to our mobile app and twice a day to our server backend, allowing us to run dozens of tests simultaneously across the entire audience. The rapid nature of our testing framework allows us to optimize the user experience. Our technology and product teams work hand in hand from ideation to product launch, and this has allowed us to be at the forefront of releasing features geared towards improving the safety of our community.”

Prospectus, February 2021

Latest quarterly results showing the Bumble App continuing to make great progress.

Let’s start with Bumble App. Q1 revenue grew 38% year over year to $155 million, fueled by growth in both paying users and ARPPU. We saw strong revenue performance in both our traditional markets, as well as in our international growth markets. The U.S.remains a very important region for us. In Q1, based on third-party data, we expanded our download share and strengthened our No. 2 position in the market. We still have substantial opportunity to grow in the U.S., and our continued pace of our user engagement is a sign of the runway we believe we have as markets continue to reopen and COVID becomes endemic.

Q1, 2022, 11 May 2022

It is also growing fast internationally.

Within our international growth markets, we are proud of our continued progress across Western Europe, Southeast Asia, India and Latin America. In Q1, Bumble App became the second most downloaded dating app in Germany, and revenue across the broader DACH region almost doubled year over year. Our on-the-ground field marketing-oriented approach, grounded in our mission, generates authentic word-of-mouth and continues to resonate internationally. We are seeing this success start to be replicated in our newer markets such as France, the Netherlands and Mexico as well.

Q1, 2022, 11 May 2022

Going forward the plan is to launch other products that are important to women and create a women first brand. Inevitably this success will attract many men to the App in the same way as nightclubs full of women are a magnet for men.

Bumble. BMBL Buy @ $34.50

Strategy

I am not trying to use fundamentals to say the shares are timely to buy and sell, only to establish that they are bona fide 3G (great growth, great story, great growth). I then use charts generally and my indicators particularly to decide if the shares are a buy and alert them accordingly. I expect to alert more shares in coming days.

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