Bumble, the dating app company known for its women-first messaging approach, is set to be taken private in a deal valued at approximately $1.3 billion by Ithaca Holdings, a newly established investment firm. The price represents a significant premium over Bumble’s recent market valuation, which has plummeted by more than 90 percent since its initial public offering in 2021.

The transaction comes amid ongoing challenges for Bumble and the broader online dating industry, as shifting preferences among younger users, particularly Gen Z, have led to declining user engagement and revenue. Competitors like Match Group, owner of Tinder and Hinge, have slightly outperformed Bumble by diversifying their app offerings and expanding internationally, with Hinge experiencing growth that partly offset flat performance from Tinder.

Bumble’s shares surged notably following news of the Ithaca deal, with initial trading gains of around 50 to 56 percent, reflecting investor optimism about the company’s future under new ownership. Whitney Wolfe Herd, Bumble’s founder and CEO who returned to lead the company in 2025, is expected to retain a stake and remain involved post-transaction. She initially founded Bumble in 2014 after co-founding Tinder at Match Group. Early investors such as private-equity firm Blackstone, which acquired a majority stake before the IPO, still hold roughly 14 percent of the company’s shares.

Ithaca Holdings was founded by Silicon Valley executives Ravi Gupta and John Hegeman, both of whom bring considerable experience from leading roles at Meta and Silicon Valley venture capital. The firm has signaled plans to apply advanced technologies, including artificial intelligence (AI), to enhance Bumble’s platform and revive its growth prospects. There is particular interest in leveraging AI to improve the app’s matchmaking algorithms, potentially creating more personalized and effective user experiences. This approach builds on existing AI initiatives in dating apps, with competitors such as Grindr and Bumble itself already experimenting with AI matchmaking assistants.

While the potential for AI to improve dating app experiences is significant, some analysts caution that poorly executed AI features could further alienate users and exacerbate challenges in an already competitive and evolving market. Nevertheless, Ithaca is acquiring Bumble at a multiple roughly half the valuation of Match Group, suggesting investors see both risks and upside potential.

The deal has not yet closed, with negotiations reportedly continuing and a formal announcement expected soon. If completed, it would mark one of Ithaca Holdings’ first major investments and signal a new phase for Bumble as it attempts to adapt to changing consumer behaviors in the digital dating space.