Tinder parent Match Group faces activist campaign from Starboard: ‘Lack of innovation'

Core Viewpoint - Match Group, the parent company of dating apps Tinder and Hinge, is facing pressure from activist investor Starboard Value to either overhaul its business model or consider going private due to concerns over a lack of innovation and declining growth [1][3][10]. Group 1: Activist Investor Campaign - Starboard Value has acquired a 6.6% stake in Match Group and is in discussions with the company to enhance profitability and reduce costs [9]. - The activist fund has suggested that Match Group should conduct stock buybacks to significantly accelerate free cash flow per share growth, arguing that repurchasing shares is the best use of cash at the current stock price [4]. - Starboard's letter highlighted that Match Group's share price has underperformed the market since its separation from IAC in July 2020, despite the company's strong market position [10][12]. Group 2: Company Performance and Competition - Match Group has experienced a nearly 70% decline in stock price over the past four years, contrasting with gains in the broader stock market [12]. - The company has faced increasing competition from rivals like Bumble, and its user base has shrunk as consumers reduce discretionary spending amid economic uncertainty [13]. - Jeffrey Smith from Starboard noted that Tinder's growth has been hindered by a lack of innovation, despite having nearly 10 million paid subscribers [1][19]. Group 3: Previous Activist Campaigns - Earlier this year, Match Group faced an activist campaign from Elliott Management, which also criticized the lack of product innovation affecting Tinder's growth [15][19]. - In response to Elliott's campaign, Match Group added new board members, including Instacart executive Laura Jones and Zillow co-founder Spencer Rascoff [16].