Grindr is pursuing a strategy to become an “everything app” for gay men as chief executive George Arison seeks to turn the dating platform’s rapid financial growth into a broader consumer business.
The company expects revenue to exceed $540 million (£405 million) this year, almost three times the $195 million recorded in 2022. Adjusted earnings margins have remained above 40%, but most of the increase has come from persuading existing users to spend more rather than significantly expanding its user base.
Grindr had about 1.4 million paying users in the second quarter, equivalent to 9% of its overall membership. Average revenue per user has nearly doubled since 2022, while the proportion of users paying for the service has risen from below 6% to more than 9%.
Arison, who joined Grindr in 2022 after previously running online car marketplace Shift Technologies, now wants the platform to become what he calls a “gayborhood in your pocket”. Dating and casual encounters would remain at its core, but the company is also developing services linked to healthcare and travel.
Grindr’s expansion beyond dating
Its healthcare plans currently include cash-pay products such as erectile dysfunction medication, GLP-1 drugs and peptides. Grindr has also launched an in-app service designed to help users access information about HIV prevention drug PrEP, with a stated ambition of giving 10 million people direct access to guidance on where to obtain it.
More ambitious plans, including telehealth appointments with gay doctors, are at an early stage. Arison said clinical care was a long-term possibility and that healthcare could eventually become a larger source of revenue than the company’s existing business.
For now, subscriptions account for about 83% of Grindr’s revenue. Advertising and other activities, including healthcare, remain a small part of the company’s operations, although Arison said he wanted to build substantial travel and advertising businesses alongside subscriptions over the next decade.
The next major test will be EDGE, a premium subscription being trialled above the existing XTRA and Unlimited packages, which cost $23.99 and $44.99 respectively in the US.
Some users have reacted angrily to reports that one Canadian test price was equivalent to roughly $350 to $375 a month in US dollars. Arison said the figure was one of several price points used to test demand and was not the final cost.
EDGE is expected to launch towards the end of this year or early in 2027. Grindr says its personalised features have produced stronger retention in testing than any previous product, with the company using users’ behaviour and stated intentions, with consent, to improve recommendations and matches.
Arison has compared EDGE with a flagship Tesla model: an expensive early version of technology that could eventually become available across the wider product.
Grindr is also exploring matches beyond a user’s home city. Arison argues that even in San Francisco, one of the US cities with the largest gay populations, the potential pool of partners is relatively limited, and that more personalised recommendations could help users find compatible people elsewhere.
He said Grindr did not track whether such matches ultimately became relationships. However, he pointed to research indicating that about half of gay men under 35 want a long-term monogamous relationship and a quarter want children, arguing that existing dating options had not solved the difficulty many users faced in finding partners.
Investors weigh Grindr’s growth prospects
Arison is also campaigning against what he believes is an unfair valuation discount applied to Grindr because it is a gay dating business. He has cited an investor who showed him a financial model containing a “Grindr discount” that reduced the company’s estimated fair value by 25%.
He said the company had encountered reputational concerns from some professional services firms, including a consultancy that declined to work with it and a bank that refused its money during the Silicon Valley Bank crisis. Other major banks, including Goldman Sachs and Morgan Stanley, have worked with Grindr.
The market’s view has nevertheless improved. Morgan Stanley, Goldman Sachs and Raymond James have all raised their price targets this year, while Morgan Stanley upgraded the stock to “overweight” in July, citing the planned EDGE subscription and the healthcare expansion.
Grindr’s shares have risen by roughly a third over the past six months. Even so, the stock trades at about 11 times its expected 2027 earnings before interest, tax, depreciation and amortisation, around 35% below comparable companies.
Arison said Grindr had increased revenue by more than 25% for 16 consecutive quarters since he became chief executive and should now be treated as a growth company rather than being defined solely by its identity as a dating app.
The company has pursued that growth with a notably small workforce. After a return-to-office policy introduced in 2023 led to a sharp reduction in staffing, Grindr now has about 175 employees in the US alongside a team in Colombia. Around 95 people work across its technical functions, supporting a business forecasting more than half a billion dollars in revenue.
