This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here
TheStreet Open House

IACI's $500 Million Hookup

Stocks in this article: IACIFB

NEW YORK (TheStreet) -- Just in time for date night Friday, the finance/tech world news learned IAC/InterActiveCorp (IACI) bought back $500 million -- or a 10% stake -- of Tinder.

For the uninitiated, Tinder is a mobile dating app that uses Facebook (FB) profiles and location tracking to match people. As the song goes, "If you can't be with the one you love, love the one you're (geotagged) with."

Tinder isn't IAC's first foray into the online dating world. Within its holding's of 50+ online brands, IAC also holds Match.com and Tinder's casual dating precursor, OkCupid. The stigma of online dating has largely been erased and one can certainly see the revenue generating potential for sites that cater more toward relationships than casual dating.

Sites such as Match and eHarmony charge membership fees and there are obvious opportunities for cross-brandings when successful matches lead to weddings and babies.

However, where is the money for casual dating where users are so uninvested they cannot be bothered to create a unique dating profile? Anecdotal evidence suggests Tinder dates are used more as fodder for "worst date ever" stories and random hookups.

At  $500 million, I am less optimistic than IAC. Under its present model, the site is not monetized; registration is free and there are no ads. The app functions more as a Hot-or-Not game than a common dating site.

The target demographic of Tinder is urban early twenty-somethings who can enjoy the game aspect of the app by virtue of living in a highly populated city. Users of the app seek instant gratification and casual flings. The fickleness users show towards dating alone should itself be an indicator of Tinder being a fad. This is the same demographic who quickly decided Facebook was no longer cool soon after Facebook users no longer needed a ".edu" email address to register.

Millennials all know the horrors of having nosy parents screening their Facebook accounts. Can you imagine the awkwardness when divorced empty-nesters download the app to brighten up their dating life?

That said, if Trojan wants to take an interest soon, my view may be slightly more bullish.

At the time of publication the author had no position in any of the stocks mentioned.

This article represents the opinion of a contributor and not necessarily that of TheStreet or its editorial staff.

Select the service that is right for you!

COMPARE ALL SERVICES
Action Alerts PLUS
Try it NOW

Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
  • Weekly roundups
TheStreet Quant Ratings
Try it NOW
Only $49.95/yr

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
  • Upgrade/downgrade alerts
Stocks Under $10
Try it NOW

David Peltier, uncovers low dollar stocks with extraordinary upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
  • Weekly roundups
Dividend Stock Advisor
Try it NOW

Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Alerts when market news affect the portfolio
  • Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
Real Money Pro
Try it NOW

All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.

Product Features:
  • Real Money + Doug Kass Plus 15 more Wall Street Pros
  • Intraday commentary & news
  • Ultra-actionable trading ideas
Options Profits
Try it NOW

Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • 100+ monthly options trading ideas
  • Actionable options commentary & news
  • Real-time trading community
  • Options TV
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!
DOW 16,380.41 +263.17 1.63%
S&P 500 1,886.76 +24.00 1.29%
NASDAQ 4,258.4380 +41.0480 0.97%

Brokerage Partners

Rates from Bankrate.com

  • Mortgage
  • Credit Cards
  • Auto

Free Newsletters from TheStreet

My Subscriptions:

After the Bell

Before the Bell

Booyah! Newsletter

Midday Bell

TheStreet Top 10 Stories

Winners & Losers

Register for Newsletters
Top Rated Stocks Top Rated Funds Top Rated ETFs