U.S. Markets closed

Blackstone to pick up MagicLab, owner of Bumble dating app

Adam Lewis

Nothing sparks true love like private equity.



At least, that's what

Blackstone is betting after the buyout juggernaut agreed to acquire

MagicLab, a London-based startup that operates a suite of popular dating apps including

Bumble and

Badoo, at a valuation of around $3 billion.



As part of the deal, Blackstone will acquire the MagicLab stake owned by Russian billionaire and company founder Andrey Andreev, who will step down from his CEO role and be replaced with Bumble CEO and founder Whitney Wolfe Herd. Andreev had come under fire after a Forbes story in July that included former female staffers alleging that Badoo's workplace environment at its London headquarters was hostile and discriminatory toward women. Andreev denied the allegations, though the company hired an outside firm to look into the claims, per Forbes. 



"My aim now is to ensure a smooth and successful transition before I embark on a new business venture in search of innovative leaders with new and exciting ideas," Andreev said in a statement. "I am grateful for all the support of my partners and employees over the years as we couldn't have gotten to this point without them. I wish MagicLab and Blackstone every success."



Andreev founded Badoo in 2006, then backed Wolfe Herd's Bumble app in 2014 shortly after she sued her former boyfriend, one-time Tinder CMO Justin Mateen, for sexual harassment, eventually settling for $1 million. Based in Austin, Texas, Bumble was an instant hit, as it differentiated itself from other dating apps by mandating that women get to message men first. The app has since grown to include over 75 million users, while Badoo has topped 450 million. 



The transaction certainly marks new territory for Blackstone, which has built a reputation for leveraged buyouts of struggling legacy companies. It will be carried out by its new growth arm, Blackstone Growth Equity, which launched in January under the guidance of former

General Atlantic executive Jon Korngold. 



But rather than make non-controlling investments, the division is apparently willing to take controlling stakes in companies, especially growing ones. MagicLab reportedly is profitable and has posted annual revenue growth of 40%, according to The Wall Street Journal. 



"We're excited to invest in MagicLab, which is a pioneer in the fast-growing online dating industry," Korngold said in a statement. “They have a highly talented team and strong set of platforms, including Bumble, which was built on a commitment to inclusion and female empowerment.



"This partnership is a perfect example of Blackstone's ability to use its scale, long-term investment horizon and deep bench of operational resources to help entrepreneurs take advantage of transformational growth opportunities in order to create global industry leaders over time."



Featured image via Teraphim/iStock/Getty Images Plus