You saw it coming a mile away.
Zoosk, the troubled online dating service beleaguered by layoffs and poor financial performance, has kissed goodbye its plans for an initial-public offering.
The San Francisco company on Friday withdrew its IPO filing, citing unfavorable market conditions. But the company also retreated from the public market because it s currently in such a state of shambles that likely investors wouldn t touch it with a stick.
Zoosk filed for an IPO in April 2014, but in December announced it would delay its debut. Around that same time, two co-founders, CEO Shayan Zadeh and president Alex Mehr, stepped down. CFO Kelly Steckelberg took over as CEO. And in January, the company laid off 15 percent of its staff.
Subscription businesses — Zoosk s business model — have not performed well in the last year, Steckelberg told TechCrunch last year. Angie s List, the subscription Website that offers crowd-sourced reviews of local businesses, has seen shares fall from a high of $28 in 2013 to just more than $6 per share today. Most of Zoosk s revenue comes from subscription fees, which made up 86 percent of its business in 2014.
Despite showing steady revenue growth, Zoosk has been challenged by competitors OkCupid and Match, which still dominate the market, and the growing popularity of dating and hookup app Tinder. Zoosk never quite developed its own brand recognition in the crowded market.
Zoosk lost $20.7 million in 2012 and trimmed its deficit to $2.6 million in 2013, while its revenue grew 63 percent to $178.2 million in 2013. But with Steckelberg at the helm, bringing strong financial expertise to the executive role, some say Zoosk has a chance to regroup and rejigger its image and finances.
Founded in 2007, Zoosk has raised about $60 million from investors.
Screenshot courtesy Zoosk