E-Business Models: Online Dating

By their second date, Roxane Sokolove knew that Sandy Marenberg was The One.

It was Oct. 27, 2000, and Sandy, then 52 and a real estate developer, showed up at the door with Halloween cupcakes for Roxane’s 8-year-old son, Evan. Such a gesture, says Roxane, a lawyer, “was really sweet.”

Sandy and Roxane, 46, met through JDate.com, an Internet dating service aimed at Jewish singles. Fifteen months after that second date, the couple married at the American Visionary Art Museum in Baltimore.

The Marenbergs are one of more than 1,000 married couples who’ve met through JDate, according to statistics from the 5-year-old company. The impressive number of successful shidukhs (Yiddish for matches) gives JDate credibility in the eyes of potential members. Another reason for JDate’s owners to celebrate: Its parent company, MatchNet, has been profitable for more than a year and continues to grow.

Two Israelis, Joseph Shapira and Alon Carmel, founded JDate in 1997. They formed MatchNet in 1998, and today it’s a $7.8 million dating dynamo based in Beverly Hills, Calif., and traded on the Neuer Markt, Germany’s Nasdaq. For the first half of 2002, MatchNet posted $937,288 in profits with a margin of 12 percent.

MatchNet generates much of its revenue from subscriptions to its seven dating sites?JDate.com, JDate.co.il (for Israelis), AmericanSingles.com, MatchNet.de (for Germans), MatchNet.co.uk (for Brits), MatchNet.com.au (for Aussies), Gay11.com and its personal photo album site Facelink.com. Other revenue sources include advertising and events like ski trips for service members. Plans call for an online dating service for Asian-Americans.

Though Gail Laguna, a spokeswoman for MatchNet, wouldn’t disclose the percent of JDate’s 350,000 members who pay for subscriptions, she did say that JDate is MatchNet’s most profitable site and that the average paid JDate subscription lasts three months.

One potential source of embarrassment: Sandy and Roxane’s profiles remained on JDate long after they were engaged. “Her picture was still up until our wedding day!” Sandy says, joking it was like his bride’s insurance policy. Roxane adds: “It’s hard to get your face out of that system, seriously. That may be the only glitch.”