Built-in churn Churn sucks, and the better your dating product works, the more your customers will churn*.Every churned customer is a new customer you’ll have to acquire just to get back to even.
So what do the churn rates look like for a dating product? Let’s calculate that: 20% monthly churn = 1-(1-0.2)^12 = 93% annual churn You read that right.
And that means at 20% monthly churn, it gets very hard to retain what you have, much less fill the top-of-funnel with enough new customers to grow the business. With most subscription products, the more you improve your product, the lower your churn.
With dating products, the better you are at delivering dates and matches, the more they churn!
As you might imagine, that creates the wrong incentives.
A product focused on casual dating, like Tinder, might escape this dilemma, but dating products generally have built-in churn that’s unavoidable.
Dating is niche and has a shelf-life All this churn is especially complicated by the fact that the dating market at any given time is pretty niche.
Similar to buying a car, refinancing your student loans, or moving into a new house, the reality is that being “in the market” as a single person looking to meet others has a limited time window.
Another way to say this is the dating has “intent” the same way that shopping might, especially when you are talking about a paid subscription service.
I’ve been listening to the excellent Season 2 of the podcast Startup, which gives an inside look at YCombinator startup The Dating Ring (NYT coverage here). They talk about many important topics, but I had some specific comments on fundraising for dating products.