Grindr LLC is looking for more than just a hookup: The application for gay men is seeking a buyer.
Grindr, based in Los Angeles, has hired Raine Group LLC to advise it on a possible sale, people familiar with the matter said. The sale process is early and no deal is assured, said the people, who asked not to be named because the process is still private.
The people didn’t know what valuation Grindr might fetch in a sale.
The service helps gay men connect online by using location-based software. Joel Simkhai founded Grindr in 2009 with $5,000. Four years later, the company is still self-funded with no outside investors, and charges about $12 a month, Simkhai said in a Bloomberg TV interview April 17.
In 2011, he started Blendr for men and women with similar interests, looking for friends in close proximity. Grindr has more than 5 million users in 192 countries, according to its website.
A spokesman for Grindr declined to comment, as did a spokeswoman for Raine.
Dating apps are struggling to sustain revenue growth, in part because after customers find a match, they tend to stop paying for the service. They also face competition from free services. Zoosk Inc., which helps make personalized matches for people online, withdrew its filing for an initial public offering on Friday after a year of delays amid management changes.
There are 3,924 businesses that count as dating services in the U.S., according to April research by IBISWorld. The industry has revenue of about $2 billion.
IAC/InterActiveCorp controls the majority of U.S. dating application market share through its ownership of Match, OKCupid and Tinder. Grindr’s direct competitors including Scruff and Jack’d.