Online dating site Zoosk filed plans to raise $100 million in an initial public stock offering, the second Mid-Market startup to file for an IPO in as many weeks.
The six-year-old company has served about 26 million members in 80 countries since its inception as a dating app on Facebook, according to IPO registration papers filed with the Securities and Exchange Commission.
But 95 percent of Zoosk’s revenues last year came from a fraction of those members — 650,000 — who are paying subscribers. And in a competitive dating game against online rivals like Match.com, eHarmony.com and Meetic.com, Zoosk said it is constantly chasing new subscribers:
“Dating is, by nature, episodic, and our members and subscribers periodically stop engaging with our platform when they enter into a relationship and may reengage or return to our platform after the relationship ends. If the rate at which our members reengage or our subscribers renew their subscriptions decreases, or if our former members and subscribers do not return to our platform when they are looking for a new dating relationship, our business, financial condition and operating results may be adversely affected.”
Zoosk posted a net loss of $2.6 million in 2013, an improvement from the $20.7 million net loss posted the year before. Revenues were $178.2 million last year, a 63 percent increase from revenues of $109.1 recorded in 2012.
The company’s workforce has grown from 105 in 2011 to 168 by the end of 2013 “and we expect to continue to grow our headcount significantly over the next 12 months,” the filing said.
Zoosk is one of several tech start ups that benefited from San Francisco’s six-year payroll tax exemption. Last week, neighboring Zendesk, which makes customers relationship management technology, filed for a $150 million IPO.