Tinder co-founders sue parent companies for $2 bn
San Francisco : Dating app Tinder's co-founders and former employees are suing parent companies Match Group and IAC for $2 billion in damages for allegedly manipulating financial information in order to reduce the platform's valuation and taking away employees' stock options.
"Through deception, bullying and outright lies, IAC/Match stole billions of dollars from the Tinder employees, who include founders Sean Rad, Justin Mateen and Jonathan Badeen, and three current senior executives," said a statement issued by the co-founders late on Tuesday.
The lawsuit, filed in New York Supreme Court, added there were written contracts between IAC and the employees for Tinder to be valued on dates in 2017, 2018, 2020 and 2021 when they would be given the chance to exercise stock options and sell them to IAC or Match Group.
"IAC/Match manufactured a fake Tinder valuation of $3 billion -- the very same valuation they had assigned to Tinder two years earlier, despite its revenues having grown 600 per cent and user base grown 50 per cent.
"Only hours later, IAC/Match secretly merged Tinder out of corporate existence and into Match Group -- diluting Tinder into a stagnant holding company," the statement added.
Tinder is one of Match Group's biggest and most profitable brands, which includes features such as "Tinder Gold" and other in-app purchases that led the platform to be the top-grossing iOS app in September 2017, according to The Verge.