Bumble’s IPO launches Wolfe Herd into a rarefied club of self-made billionaires.
A company dedicated to women and run by women has turned its 31-year-old founder into a multimillionaire.
Shares of Bumble Inc., which owns the dating app where women take the first step, shot up 67% in its $ 72 business debut at 1:03 p.m. in New York, valuing the councillor’s participation. delegate Whitney Wolfe Herd at $ 1.5 billion.
The list includes an inspiring and admonishing saga for women founders of technology. Wolfe Herd took advantage of an underserved market and built a multimillion-dollar company that in a sense was born of one of the most annoying obstacles for women entrepreneurs: sexual harassment.
“Hopefully this isn’t a weird headline,” Wolfe Herd said Thursday in an interview with Bloomberg Television, referring to the uniqueness of Bumble’s women-led direction. “We hope that’s the norm. It’s right, it’s a priority for us and it should be a priority for the rest.”
Bumble’s IPO launches Wolfe Herd into a rarefied club of self-made billionaires. Although women make up about half of the world’s population, self-made women, mostly from Asia, account for less than 5% of the world’s 500 largest fortunes, according to the Bloomberg Billionaires Index. Homemade men make up almost two-thirds of the wealth index.
Of the 559 companies that have been listed in the United States over the past twelve months, only two, apart from Bumble, were founded by women. The same goes for blank check companies, Wall Street’s moment-promoting vehicle for wealth. Women-sponsored SPACs numbered less than a dozen, a fraction of the 349 listed last year.
That means women are largely left behind in what is probably the fastest wealth-creating boom in history. Last year, the world’s 500 richest people earned $ 1.8 trillion, though 91 percent of that spending went to men, according to the Bloomberg index.
“This is a big win,” said Allyson Kapin, general partner at investment firm W Fund and founder of the Women Who Tech network. “Whitney saw an opportunity that was not aimed at women and, based on her experience, turned it into a gold mine, not only for her and her team, but also for her investors.”
Among the many impediments for women and other underrepresented groups in the early world, including people of color, harassment is one of the most widespread. Last year, a Women Who Tech survey found that 44% of women founders surveyed reported experiencing workplace harassment, and that more than a third of that group faced sexual harassment.
In fact, it was harassment that drove the creation of Bumble. Wolfe Herd founded the company based in Austin, Texas, in 2014, after leaving Tinder, the rival dating app he helped found. The split was sour, marked by a sexual harassment lawsuit filed by Wolfe Herd against the company, alleging, among other things, that executives repeatedly called it derogatory names and removed the role of co-founder since he had a “girl” with that title the company seems like a joke. ”The lawsuit was later settled.
Training experience
The experience was formative. Initially, she wanted to create an exclusive women’s social network for women to send praise to each other, but ended up focusing on creating parties on the advice of Russian tech billionaire Andrey Andreev, the founder of the dating app Badoo.
With Andreev’s support, Wolfe Herd created Bumble as a service “for women, for women,” promoting it as a place where women were empowered and where harassment was rigorously monitored. It has become the second most popular dating app in the United States with the help of ads that include tags such as, “Be the CEO your parents always wanted you to marry.”
Wolfe Herd took over from Andreev when Blackstone Group Inc. bought a majority stake in the Bumble owner at a valuation of about $ 3 billion last year. As part of the deal, Wolfe Herd received about $ 125 million in cash and a $ 119 million loan that he has since paid off in full.
“I felt very comfortable handing the baton to Whitney,” Andreev said in an email. “She has proven to be very insightful and innovative in the dating space.”
Key obstacle
Wolfe Herd’s collaboration with Andreev helped her overcome a key hurdle for women-led, women-centered startups: funding. Less than 3% of venture capital dollars go to women-founded start-ups, according to Pitchbook data, a figure that has barely occurred over the past decade.
The tendency of venture capitalists to finance what they know and who is part of their network maintains the gap. And that, while there is evidence to suggest that women-run startups actually produce better returns than men-based ones. Studies by the Kauffman Foundation, MassChallenge, and BCG found that women-founded companies generated more revenue and were significantly more efficient in capital.
“It’s not about charity, it’s about making a lot of money,” Kapin of Women Who Tech said.
Another high-profile list on the horizon is that of Honest Co., a baby and beauty products company co-founded by actress Jessica Alba that is said to be preparing to go public.
Women in the early world are optimistic about the rising tide. “Whitney’s success will help foster investment in companies that serve a female audience or are founded by women,” said Kelsi Kamin, venture capitalist in Austin. “It’s a super exciting time.”
(Except for the headline, this story has not been edited by NDTV staff and is published from a syndicated feed.)