- 2 years ago
George Arison, Chief Executive Officer, Grindr Interviewer: Polina Pompliano, Founder, The Profile; Co-chair, Fortune Founders Forum
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00:00Georgia and I were both born in Eastern Europe, Bulgaria and Georgia, the country, and our
00:07Just a black sea apart.
00:08Yeah.
00:09And our cultures at the time didn't exactly put a premium on capitalism and entrepreneurship,
00:17but you moved to the U.S. at age 14.
00:20Can you tell me how and what drew you to the U.S.?
00:24So my dad was a little naughty, and he believed that Soviet Union was going to fall apart
00:29and that English was going to be the kind of the way to survive.
00:31And when did he think that they...
00:32Like 1980s, early 80s, yeah.
00:35And so he forced us to learn English, me and my brother, when we were very young.
00:39I on my own applied to U.S. prep schools when I was 12.
00:44I got into a few of them, fortunately, because I had American tutors in Georgia who wrote
00:48me reference letters, and so it kind of worked out.
00:51And then I went to U.S. embassy, got a visa and showed up in the U.S. when I was 14, and
00:56I was one of the very first Soviet kids that I allowed to leave to come to the U.S.
01:01So I was very lucky.
01:03So I had this ingrained in me that going to America was the thing to do.
01:07So even though I grew up in a very Soviet environment, like the support for America
01:10was very, very high in my mind.
01:13And I kind of joke, like I've built three companies since then, and I joke that actually
01:18coming to America was my first startup.
01:20Yeah.
01:21It was kind of game-changing for my life.
01:23Yeah.
01:24Very similar upbringings.
01:27So before you became Grindr CEO in 2022, you had actually co-founded several startups,
01:34and you've said before, there's a lot of founders in this room, you've said before that founding
01:39a company is an impossible thing to do, and that you have to be a little bit arrogant
01:44to become a founder.
01:46Arrogant and crazy.
01:47Arrogant and crazy.
01:48So I'd like to hear what you think it takes to start a company in today's environment.
01:54Yeah.
01:55So one of my motives in life is like do impossible things, which obviously is an oxymoron, but
02:00I think it kind of encompasses at least how I shape my life.
02:03And I came up with it once because I had an employee at Shift, my previous company, who
02:08was really complaining about like, this can't be done, this can't be done.
02:12I'm like, look, man, my whole life is impossible because I'm now here doing this, and look
02:17at where I was born, so nothing's actually impossible.
02:19And so that's been really effective for me as an executive.
02:23Frankly, it's very effective with my kids too, because now my daughter, whenever she
02:28doesn't want to do something, it's like, oh, nothing is impossible, daughter, and I can
02:30actually do it, which is really good.
02:33And I think that's true kind of always.
02:35That's not a differentiator thing.
02:37I think the thing that's really different about now versus say even a decade ago is the number
02:43of people you will need to build a company is actually going to be much less than you
02:47needed in the past.
02:48Why?
02:49Because of what AI is going to do to how we work.
02:52And so if a company is starting now or especially a year from now, I can easily envision a company
02:57getting to 50 or 100 million in revenue with like 25 employees because they'll have a bunch
03:03of synthetic employees as well doing a lot of the work.
03:06And so that's a really big difference because then the people you bring on board as your
03:10core team need to be exceptionally good because the synthetics are going to be providing leverage
03:17for them and then to be able to work that way.
03:19So I think talent is going to become more, I mean, it's always difficult.
03:23But in startups, this is like, okay, for now, he'll be good enough for the next 18 months,
03:29get me to the next stage, and then I'll get somebody else.
03:31I don't know if you could do that anymore in a world that we're entering to in the future.
03:35And I like that.
03:36Synthetic employees.
03:37I hadn't heard that before.
03:39So George actually took Grindr public.
03:44And a few things to note, Grindr generated $75.3 million just in Q1 of 2024, and it has
03:52a market cap of 2.1 billion.
03:54For those who aren't familiar with the Grindr model, how do you make money?
03:59Yeah.
04:00Well, the vast majority of the money we make is through subscriptions.
04:02So we have two tiers of subscriptions.
04:04One's $19.99 and one's $39.99, and people subscribe to that.
04:08We have a fairly low pay penetration.
04:10It's about 7%.
04:11As a comparison point, Tinder, which is kind of the dominant product for straight people,
04:16it's about 15% pay penetration.
04:17Fifteen percent?
04:18Fifteen, yeah.
04:19So there's a lot of room.
04:20Largely, it's because Grindr never really focused on monetization until about three
04:23years ago, so we're now only now starting to kind of drive monetization in a big way
04:27by investing in the product and building features that people want to pay for.
04:31And then we have an ads business, which is about 15% of our revenue.
04:35And that's a big growth opportunity as well for us, because we have a very kind of in-demand
04:40user base.
04:41You know, average gay couple in America has a household income that's twice as high as
04:45an average straight couple.
04:47Interesting.
04:48Gay men have 2x likelihood of having a JD, MBA, PhD, MD, versus a straight male counterpart.
04:54They also don't usually have children, so they have a lot of disposable income and more
05:00time.
05:01So the audience is really good for advertising, and so that's another big growth factor.
05:03So those are the two primary ways in which we make money.
05:06Yeah.
05:07I want to come to you guys for questions.
05:08If you have a question, please raise your hand and we'll send somebody your way.
05:12Before we come to you, I have one more question for you.
05:14So it really feels like Grindr is innovating at kind of breakneck speed.
05:19You have added features around trip planning.
05:22It's more of a community than the other dating apps.
05:25You're creating a gayborhood in your pocket.
05:28What features can users expect in the near future?
05:32When I joined, Grindr's always been the thing that it does really well, which is the right
05:37now immediate use case with a user or long-term relationships.
05:41Our rough estimate is somewhere between one in four to one in five gay male relationships
05:46in the U.S. originate on Grindr, so we do play a pretty big role in that sense.
05:52But people do use the product in a very community sense as well, like, hey, I'm going to Singapore.
05:57Let me use Grindr to figure out what I'm going to be doing in Singapore.
06:01And oftentimes, like, I interviewed a candidate once for a fairly senior role, and he's like,
06:05oh, yeah, my friend just had a tour of Singapore for three days with this guy that he met with
06:09on Grindr, and that's not an uncommon thing.
06:12So a lot of what our focus has been, like, how do we productize all that?
06:16People already use Grindr in so many different ways, but we don't have features for that.
06:20Can we build features for those?
06:21And so we are now going in that direction.
06:23The two things we've publicly talked about, one is travel, because I think there's a pretty
06:26big opportunity there in travel planning and events planning, and that's both local
06:31discovery and when you're traveling discovery, like, hey, what are the activities going on
06:35tonight?
06:36Where should I go to a bar?
06:38What are the places for me to stay, et cetera?
06:40And the second big one is around health and wellness.
06:43Not surprisingly, health and wellness is really important to gay, bi men.
06:47It's like a big driver of how we make decisions.
06:49And so there's a lot we can do there.
06:52We're not really given use case examples of that yet, because we're not ready to do that,
06:55but I think it will be kind of coming.
06:56But you can imagine anything from, like, you know, people might want to buy certain types
07:02of medications, which they already do, but we actually can extend our brand to let them
07:05do that and integrate that with our core product, to, you know, loneliness and depression is
07:12a really big thing in our community, and if we can do things through AI to help support
07:16those problems and help people be in a better place, that could be really valuable for the
07:20users.
07:21So that's kind of what we're envisioning.
07:22And I want to highlight something here, because as I'm hearing you talk, if you're on Tinder
07:28or Bumble, once you meet somebody, you get off the app.
07:31Correct.
07:32But Grindr, technically, you can stay on the app.
07:35A lot of people stay on the app, even in a relationship.
07:37That's actually quite common.
07:38Yes, people kind of do a little bit age out.
07:41So we do have an opportunity to kind of bring people, you know, 40 plus to be more engaged.
07:46If you look at our user cohorts, like, we start to not have as many users at that age
07:49group as we used to.
07:50So there is a way to bring them back, I think.
07:53But in general, people stay on the app for a long time.
07:55That's fascinating.
07:56Any questions?
07:57Right here.
07:58Please state your name, company, and be concise.
08:07Hey, I'm Andy Dunn.
08:10My company's called Pi.
08:12I live in Chicago.
08:13Do you think Chicago can ever become a great tech place?
08:16Yeah, so we were really lucky.
08:20Grindr used to be owned by the Chinese, then was forced through Cepheus to be bought by,
08:23you know, a non-Chinese ownership cohort, which is mostly American and American allies
08:29that bought it.
08:30And the team, the engineering team at that point, was almost all based in Taiwan.
08:35So when that transition happened, they all quit.
08:37So there's like emergency, we have no engineering, what are we going to do in 2020 in the middle
08:41of COVID?
08:42It so happened that one of the people involved in that transaction was Sam Yagen, who is
08:46the former CEO of Match.
08:48And he had been a CEO of another company that had sold to FedEx, and they had let go
08:53of a bunch of engineers.
08:54And so he's like, wow, I actually have a bunch of engineers in Chicago that Grindr should
08:58hire.
08:59And so we got a little bit of an aqua hire-like situation.
09:01It wasn't actually an aqua hire, but, you know, we brought a bunch of engineers in together
09:05from the shop run team into Chicago, so we end up with a Chicago team that way.
09:09And since then, we've dramatically expanded the team.
09:11That's actually where most of our engineers are.
09:13We do have engineers in the Bay Area as well.
09:15And it's been really effective.
09:17I mean, I generally think that, you know, during the last decade, it's gotten a little
09:23bit out of control in terms of what people's expectations are, and the prima donna nature
09:27of stuff has been a little bit too much.
09:29And that's something we don't experience in Chicago.
09:33And that's very positive.
09:34The flip side that was hard is actually finding mobile talent.
09:38Like hiring iOS engineers in Chicago has been way more difficult than I would have expected.
09:43Tinder has 13.7 million monthly active users.
09:47That's an insane number.
09:49Why do you think that your dating app competitors, like Tinder and Bumble, are on the decline
09:54while you're growing?
09:55Well, I'm asked this question a lot, and I try to be super diplomatic in what I say.
09:59I know.
10:00Don't be diplomatic.
10:01Well, it's like, I mean, we are all kind of trying to do the same thing, which is, like,
10:05help people find love, right?
10:06So I think we should be positive about that.
10:08But one of the things that strikes me about how Bumble and Tinder approach the world is
10:14that they, frankly, don't treat 70% of their users very well.
10:19Explain that.
10:20Like, 70% of people who use both of those products are men.
10:24And the way they talk about their male users is actually really negative, to the point
10:30where, like, they're offensive to them.
10:32And I'm not their target audience, but I still, as a guy, I'm offended.
10:37And it's not because, like, I think it's great to be talking about how we are really
10:41targeting women, and we want to create a really great experience for women, 100%, that's awesome.
10:46But you can create a great experience for somebody without creating a bad experience
10:49for somebody else.
10:50And is it the messaging or the customer experience?
10:53It's both.
10:54It's, like, the messaging, but the user experience as well.
10:56So you have, like, these huge percentage of men who are looking to settle down, who are
11:00looking to find a partner, and they're very captive to the product in the period when
11:05they're there.
11:06So why not build a lot of features for them?
11:08By the way, those are your paying users as well, because both of the products are built
11:10in a way in which men pay and women don't have to pay for the product as much.
11:15And so I think it's a huge missed opportunity in kind of how they speak about it.
11:20And in some ways, it's gotten worse, because instead, like, as I run into problems, instead
11:24of thinking, like, hey, I got this huge audience I don't do anything for, let me lean into
11:28that one.
11:29And I'm trying to lean more into the audience that they've always been doing something for,
11:32which is the women.
11:33But the result of that is they're even more negative about men.
11:35So, like, when I listen to the earnings, I'm just like, wow, like, if I was a user,
11:38I wouldn't want to even be on this product, given how they're talking about me.
11:42So that's one thing.
11:43The second thing is the product innovation hasn't really happened, right?
11:46Like, they've had the product they've had, and they've not really innovated.
11:49Everyone's like, well, why is Hinge doing so well?
11:51Well, because Hinge is actually product innovating.
11:53So people are moving to a product that is new and different, which is exactly what you'd
11:57expect.
11:58I mean, if we did not product innovate for a long time either, that's why we're now very
12:01much focused on product innovation, because if you don't do that, then users are going
12:05to go somewhere else, inevitably.
12:07In 30 seconds, can you tell me, in 10 years, is Grindr still a dating app, or is it something
12:13else?
12:14Well, we already, like, I said this at Investor Day last month, that we are more akin to a
12:18social network than we are a dating app.
12:20Yes, dating and the casual dating experience is always going to be core to Grindr.
12:25I mean, very directly, like, sex is a really big part of gay culture, and if you try to
12:29remove that, that would not really work.
12:31But around that, we can build a lot of stuff that's more social network-like, with a very
12:35kind of direct online and in real life component.
12:38So I think that's the direction we'll be heading into.
12:40And when can we expect more of these features to come to the app?
12:44So we gave a lot of direction on this at Investor Day.
12:47I mean, we are, one of the big things we're working on right now is called Right Now.
12:51That's going to be coming late this year, early next year.
12:54Some of it is already in launch, but a lot more of it, and then the rest of it probably
12:58kind of in 25 and into 26.
13:00Amazing.
13:01Thank you so much, George.
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