Online dating company Cupid: female users of the dating site encourage male users to buy memberships?
International online dating company Cupid saw its share price plummet on Friday following a Ukrainian newspaper investigation into free members of the many sites operated by Cupid being duped into buying memberships. The investigation by the Kyiv Post revealed members of Cupid’s Ukraine based motivation team were told to pose as female website members and communicate with male members to tempt them into buying a membership. Cupid, based in Edinburgh, Scotland were forced to deny similar allegations made by a BBC documentary team in 2012.
The 57 percent loss of the share price saw shares drop to just 49p and prompted speculation that a long rumored takeover by Match.com owner InterActiveCorp. A rumored takeover of Cupid by American based IAC has long been on the cards as IAC is thought to want access to the more than 54 million registered users of Cupid spread across sites such as IndianDating.com and BeNaughty.
Prior to the latest round of allegations made against Cupid the company’s founder Bill Dobbie had been looking to expand the company’s workforce after moving into a new suite of offices in Edinburgh’s city center. The founder of Cupid had also been in the midst of an aggressive attempt to increase his stake in Cupid before any takeover bid appeared from IAC. Dobbie had moved a large amount of the Cupid workforce to the Ukraine, but kept the company’s headquarters and core staff based in Scotland; Cupid admitted a 24 person motivational team does exist to ensure the company’s sites are the best available, but do not pose as female site members.
The latest allegations surfaced when a female Ukrainian journalist posed as a job applicant for Cupid’s motivational team; during the interview the journalist attended she was told a portion of her job required her to pose as a female member and obtain credit card numbers from male members for website subscriptions. As details of the Kyiv Post investigation surfaced on Friday Cupid saw the huge drop in its share price, which resulted in a loss of more than 40 million pounds for the company. Founder Bill Dobbie saw his personal stake in the company reduced by more than 10 million pounds.