Bumble’s IPO launches Wolfe Herd into a rare club of billions of women.
A women’s-run women’s catering company has made its 31-year-old founder a billionaire.
Shares of Bumble Inc., the owner of the dating app where women make their first move, rose 67 percent in its $ 72 business debut at 1:03 p.m. in New York, valuing CEO Whitney Wolfe Herd’s $ 1.5 billion share. .
The listing includes a saga that is both an inspiration and a warning story for women founders of technology. Wolfe Herd capitalized on a disadvantaged market and built a billion-dollar company, which, in a sense, was born out of one of the most annoying obstacles to women entrepreneurs: sexual harassment.
“Hopefully this won’t be a rare headline,” Wolfe Herd said Thursday in an interview with Bloomberg Television, referring to the uniqueness of Bumble’s women-led management. “We hope this will be the norm. It is what needs to be done, it is a priority for us and it should be a priority for everyone else.”
Bumble’s IPO launches Wolfe Herd into a rare club of billions of women. While women make up about half of the global population, self-made women – mostly in Asia – account for less than 5% of the world’s top 500 fortunes, according to the Bloomberg Billionaires Index. Self-made men account for almost two-thirds of the wealth index.
Of the 559 companies that have been listed in the US in the last 12 months, only two, apart from Bumble, have been founded by women. The same goes for companies with empty checks, the favorable vehicle of Wall Street for the time being. Women’s-sponsored SPACs totaled less than a dozen, a fraction of the 349 listed in the past year.
This means that women are largely left behind in what is probably the fastest wealth creation boom in history. Last year, the world’s richest 500 people earned $ 1.8 trillion, yet 91 percent of that reduction came for men, according to the Bloomberg index.
“This is a huge gain,” 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 for women and, based on her expertise, turned it into this 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 start-up world, including people of color, harassment is one of the most ubiquitous. A Women Who Tech survey last year found that 44% of women founders surveyed reported being harassed at work, with more than a third of the group facing sexual harassment.
In fact, harassment spurred Bumble’s creation. Wolfe Herd founded the company in Austin, Texas, in 2014, after leaving Tinder, the rival dating app she helped find. The breakup was bitter, marked by a sexual harassment lawsuit filed by Wolfe Herd against the company, accusing, among other things, of repeatedly naming derogatory names by executives and abolishing her role as co-founder, since she had a “girl” with the title “makes the company look like a joke.” The process was later established.
Formative experience
The experience was formative. She initially wanted to create an all-female social network so that women could send compliments to each other, but ended up focusing on matches on the advice of Russian billionaire Andrey Andreev, the founder of the Badoo dating app.
With Andreev’s support, Wolfe Herd created Bumble as a “women’s, women’s” service, supporting it as a place where women were empowered and harassment was rigorously controlled. It has become the second most popular dating application in the United States with the help of ads that carry label lines such as: “Be the CEO of your parents always wanted to get married.”
Wolfe Herd took over Andreev when Blackstone Group Inc. bought a majority stake in owner Bumble at a valuation of about $ 3 billion last year. In the transaction, Wolfe Herd received approximately $ 125 million in cash and a $ 119 million loan, which he repaid in full.
“I felt very comfortable giving Whitney the baton,” Andreev said in an email. “It has proven to be very insightful and innovative in the meeting space.”
Key obstacle
Wolfe Herd’s partnership with Andreev has helped her overcome a key hurdle for women-led start-ups: funding. Less than 3% of venture capital dollars go to women’s businesses, according to Pitchbook, a figure that has barely changed in the last decade.
The tendency of venture capitalists to finance what they know and who is in their network supports the gap. And this despite the evidence that suggests that women-led startups actually produce better returns than those founded by men. Studies conducted by the Kauffman Foundation, MassChallenge and BCG found that women-founded companies generated more revenue and were much more efficient in terms of capital.
“It’s not about charity, it’s about making a lot of money,” Kapin told Women Who Tech.
Another profile list on the horizon is that of Honest Co., a children’s products and beauty products company co-founded by actress Jessica Alba that is said to be preparing to go public.
Women in the start-up world are optimistic about the rising tide. “Whitney’s success will help continue the case for investments in businesses that serve a female audience or are founded by women,” said Kelsi Kamin, a venture capitalist in Austin. “It’s a very interesting moment.”
(Except for the title, this story was not edited by NDTV staff and is published in a syndicated stream.)