See also: ‣

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Experimental Format. Not sure yet if we want to discuss investment decisions in this format or slightly different. We rank arguments in order of importance.

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Decision:

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MM:

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Aron:

Arguments for reducing the position

  1. Completely new team that are yet to prove themselves: ‣ (30%)
  2. Negative user trends and industry decline: Match Group User and Engagement Trends (20%)
  3. Relying on prices to compensate payer decline may not be sustainable due to threat from rivals: ‣ (10%)
  4. Further deterioration in earnings may impact its ability to pay back the term loan of $589 million (as at September 2025 in January 2027) plus interest payments of around $50 million per year: ‣ (10%)
  5. It’s better to buy a good company at a fair price than to buy a bad company cheaply (Buffet’s words). Waiting until trends improve before buying more or having a large position may be better.(5%)
  6. I expect further price pressure due to the risks surrounding the company. (5%)
  7. The TRA buyout which carried 50% discount and whose payments ($27-59 million per year for 15 years) could signal that insiders are cautious on the company’s future profitability? [Aron’s assessment: The TRA buyout which carried 50% discount and whose payments ($27-59 million per year for 15 years) could signal that insiders are cautious on the company’s future profitability?](https://curved-newsboy-c80.notion.site/Aron-s-assessment-The-TRA-buyout-which-carried-50-discount-and-whose-payments-27-59-million-per--2a2950cb737780d583c7d1d0578ee03a) (5%)
  8. Possibility of multiple app usage by users, leading to faster churn. According to Apptopia data, 50% of Bumble users are in Tinder while 22% of Tinder user are in Bumble. (5%)
  9. Blackstone could be preparing to dispose of its stake by converting its entire common units into Class A Common Stock. This could drive share price down further: ‣

Arguments against reducing position

  1. Wolf Herd being the founder will do whatever it takes to turn around the company including further cost reductions (i.e. layoffs) if necessary (35%)
  2. Wolfe Herd now seems to control 62 % of Bumble’s total voting power after Blackstone converted its entire common units into Class A Common Stock as of November 5, 2025: ‣
  3. Possibility of large reversion in payer declines once safety and trust measures are complete next year. 80% of the decline in payers in Q4 (-16%) was due to the trust and safety measures and reduction in marketing expense: Cook: Q3 payer decline driven by Trust and safety work and reduction in marketing spend (contributed approximately 80%).→where is the other 8% decline coming from? (20%)
  4. The Beehive Fit Framework may ultimately lead to higher quality platform, enabling Bumble to increase prices further: User Quality Segmentation (15%)
  5. Better match-making through AI, leading to higher ARPU. (15%)
  6. First-mover advantage in women app dating. (10%)
  7. $100 million costs savings next will largely compensate the decline in revenue: The $100 cost base savings so far include approximately $40 million related to the June workforce reduction. (5%)
  8. Around $26 million savings from alternative payment systems: Bumble tailwind from alternative billing system
  9. I think the possibility of losing a lot of users to Hinge might be low given the strong psychological moat: Bumble declining user trends, dating fatigue in Gen Z. Payer shrink 15%+ a year
  10. If our conviction on the long-term opportunity is strong then share price headwind in the short term is just noise!

Conclusions

My current take is to reduce the position. I think the risks are a lot which would put share price under pressure in the short-term.

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MM

Arguments for reducing the position

Arguments against reducing position

  1. Ai potential + The upsides feels significantly larger than the downside and the business is relatively cheaply valued (35%)
  2. Founder + strategy + longterm vision feel great overall (25%) - Founder done it before.
  3. See some signs of good execution e.g new brand campaign, app is working (+ also some new functions in the app like compliments, app feels stable, many users in Malta) (10%)
  4. Potential for increasing ARPUS. E.g. via new monetization functions etc. etc. or simply higher prices to counterbalance user loss. (10%)
  5. Probably company can keep cutting costs + raising prices if needed (10%)
  6. Many men who pay use multiple dating apps in parallel and pay for all of them (?)← Theory (5%)
  7. Unlikely that company marketcap falls as low as 300m?! (2$ a share) ← Theory. (5%). Stock price is down already too much.
  8. Potential feels exciting. Somehow i (MM) want to have a part of it (5%)

Conclusion

MM: I decided to not reduce the position. It’s a small position and most important criteria: founder + execution + technological revolution / accelerator (ai) + cheap valuation - in total some of the most important criteria of my successful investments in the past are still intact.

So willing to take a risk here with a small position and increase instantly if we see signs of sustained turnaround.

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Further ToDos

In future aim to make such decisions early to avoid being caught up by market movements!

Before earnings: Make a decision on whether to buy or sale before immediately the results are out