Gay dating app Grindr will list on the public markets by means of a SPAC merger. Some 28% of straight people have used dating apps while 55% of lesbian, gay and bisexual people report having used one. The greater penetration enjoyed by the company is one reason it has so far been successful. The greater penetration enjoyed by its users is another.

The lowdown

• 🇬🇧 Rishi Sunak likely to be next UK PM after Boris Johnson withdraws.

• 🧸 Mattel fined $3.5 million by SEC after misstatements in its 2017 financial report.

• 🇨🇳 Chinese stocks tumble following Communist Party Congress.

Flex your finance muscle 💪🏦 

Over the next couple of months, we are going to be working our way through terms likely to be found in a standard VC term sheet. 

Liquidation preference

A liquidation preference is a mechanism which determines the order in which equity and debt holders are paid out, and how much, in the event of a liquidation event such as a winding up or sale.

A point to note about liquidation preferences is that they may not simply return the amount of the original investment to an investor. Instead, a deal may be structured so that it returns a multiple of the original investment in a liquidation event. In this case, a shareholder with a liquidation preference may generate a return, even where the company is sold at a level below the valuation at which they invested. 

Structured deals like this are becoming more common. Read more about them here.

Featured stories

Grindr to list on public markets by year end

Gay dating app Grindr will enter the public markets by the end of the year when it completes a merger with Tiga Acquisition, a special purpose acquisition company. 

The deal values Grindr at $2.1 billion. To put this into perspective, Match, owner of Tinder, Hinge and other dating apps, is currently valued at $12.1 billion — six times more than Grindr but with 20 times more users. Is Tiga overpaying? ($)

SPACs experienced huge popularity in 2020 and 2021, but market conditions have changed. Now, just like an ugly person using unfiltered photos on a dating app, SPACs are struggling to find a match and are being shut down.

The content we're consuming today

• The Economist: Can Britain escape the “moron risk premium”?

Off-balance sheet items

• The late, great David Graeber cycles through the history of debt. A game-changing listen for understanding our relationship with money. (And an intro YouTube video for readers who can’t get the BBC.)

The bottom line