Meta-Universe Unmatchable? Tinder Abandons Virtual Dating and Tinder Coins Project: Metaverse Potential May Be Ineffective

The dating platform Tinder, which proposed the "Tinderverse" metaverse project in November 2021, has decided to scale back the metaverse project and cancel the programmatic economy plan for Tinder Coins amidst poor performance in its Q2 financial report.

Tinder CEO Steps Down, Uncertainty Looms Over Metaverse

Renate Nyborg, the first female CEO of Tinder, took office in September last year, driving the Metaverse project and acquiring an AR and artificial intelligence company called Hyperconnect. Nyborg aimed to enhance Tinder's virtual dating experience within the Metaverse and introduce a program-based economy using Tinder Coins.

However, Match Group's Q2 earnings report revealed that Bernard Kim, who took over as the group CEO just two months ago, announced Nyborg's departure. A new executive team will temporarily fill the position until a permanent CEO is found.

Bernard Kim stated, "Given the uncertainty around what the final shape of the Metaverse will be and whether it will be helpful, along with the increasingly challenging macro environment, I have instructed Hyperconnect to maintain status quo and not heavily invest in the Metaverse at this moment."

Match Group recognized an operating loss of $10 million in Q2 due to the Hyperconnect acquisition, leading to lower revenue compared to the same period last year. Bernard Kim mentioned that they would cautiously evaluate this area and follow up at an appropriate time when they have a clearer understanding of the overall opportunity.

Tinder Coins Fall Short of Expectations

Starting last year, Tinder tested a program-based economy called Tinder Coins, aiming to reward active users with Tinder Coins and encourage them to update their profiles. Users could also purchase Tinder Coins to access services.

Bernard Kim mentioned that the test results for Tinder Coins were mixed. Therefore, the full launch of Tinder Coins, originally planned for the third quarter of this year, has been put on hold for reassessment of its potential contribution to revenue. They will also reconsider if virtual items can truly drive real growth for Tinder.

Despite an overall revenue increase compared to the same period last year, Tinder's growth was below expectations, causing Match Group's stock price to drop over 20% after the financial report was released.

Meta's Metaverse Division Reports $5.7 Billion Loss in First Half of the Year

The Metaverse seems to be an early and costly vision, with Meta's ambitious focus on the Metaverse resulting in significant losses.

In the first quarter, Meta's Metaverse division, Reality Labs, saw revenue grow by over 30% year-on-year but incurred a nearly 40% increase in losses, reaching $2.9 billion. At that time, CFO Dave Wehner mentioned that the development costs and expenses grew from the App and Reality Labs division. Founder Mark Zuckerberg noted that they realized the high development costs of Reality Labs and the long-term goal is to profit through the "Family of Apps" and provide funding for Reality Labs.