How Badoo built a billion-pound social network. on sex
Andrey is Andrey Andreev, originally from Moscow but based in London for the past six years, who founded Badoo on a string of other highly profitable Russian internet businesses: Mamba, SpyLog, Begun
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It’s a 120-million-member social network that’s adding over 300,000 users a day, with more than 4.3 million daily photo and video uploads, and seven billion monthly page views. It has Facebook’s fastest-growing app, with 570,000 new daily users, making it the third-biggest app of all after FarmVille and CityVille. Hugely profitable, it’s hookup finder Pomona forecast to generate hundreds of millions of dollars this year, and is being aggressively courted by venture-capital firms valuing it in the billions. And it’s run from London by a secretive Russian serial entrepreneur who has steadfastly refused to be interviewed or photographed. Until now.
Badoo is the world’s largest social network that you probably haven’t yet heard of. Run from 800-square-metre loft-style offices in Soho, it is brilliantly effective at providing one simple and universally compelling service: hooking up members according to their profile pictures and location. “Chat, flirt, socialise and have fun!,” implores the home page, alongside photos of prospective friends such as Terri, 21 (“Wants a candlelit dinner”), and Christopher, 25 (“Wants wake up with a girl” [sic]). Sign in, and a message declares that “204,516 girls [or guys] near you are looking to meet a guy your age!”.
Explain your intentions (the pull-down menu’s suggestions include “to talk about sex”, “to get a massage”, “to flirt”) and Tatyana, Oshrit or Gary might just give you access to their stash of private photos.
Still barely registering in Britain or the US, the free-to-use network — on the web and via smartphones — is a mass phenomenon in Brazil (14.1 million members), Mexico (nine million), France (8.2 million), Spain (6.5 million) and Italy (six million). Relying on word-of-mouth rather than any marketing spend, it has cracked the internet’s eternal conundrum: how to persuade users to pay hard cash in a world drowning in free digital services and content, by charging members each time they want to boost their visibility to others searching for a date.
Today, A-list investors such as Sequoia and Accel are courting the business and there is talk of an initial public share offering. “Cracking the Anglo-Saxon market will probably give us double to triple today’s reach,” says Bart Swanson, recruited as CEO last azon into Europe and run EMI in France. “The opportunity for people discovery [through Badoo] is a horrendously large market — it’s a confluence of social, proximity, mobile, and it’s extremely local. The basic mechanism of what Andrey has developed is genius — just like Google with its AdWords, it’s people paying for self-promotion. And it works.”
A year after Badoo’s 2006 launch, when it had 12 million members, Russia’s Finam Technology Fund bought a ten per cent stake for $30 million, valuing it at $300 million (this year Finam will realise an option for a further ten per cent at a higher valuation)
Andreev, a youthful 37 with a cherubic smile below a floppy fringe, has so far eluded media attention: Russian Forbes last year called him “one of the most mysterious businessmen in the West” (it also reported his original name as Andrey Ogandzhanyants, under which the domain was registered). We were introduced in January by Israeli investor Yossi Vardi at Burda’s DLD conference in Munich, which Vardi co-chairs, and later met in London. (Vardi has no stake in Badoo.) And then in mid-February, alone in an office belonging to Freud Communications, Andreev agreed to share his story. It has been a busy few days. Andreev explains that Michael Moritz, the legendary Sequoia investor who took early stakes in Google and Apple, has just flown in from Palo Alto to meet him; he has also been meeting Kevin Comolli of Accel’s London office. Moritz declined to speak to Wired, but Comolli — whose investments include Playfish, Kayak and Getjar — calls Andreev a “genius” with whom he would like to work. “Badoo is a social phenomenon,” Comolli says. “It’s explosive growth, viral, it’s playful, it seems consistent with offline social interaction but in this hypervirality mode that only the internet has enabled. The secret sauces in companies like this are so nuanced, and the difference between getting it wrong and right lies only with these special people like Andrey. He’s created something very powerful.” So why has Andreev remained silent? “I love to focus on making things rather than exploring myself,” he says quietly and precisely, his 5′ 8″ frame constantly moving in agitated discomfort at being quoted on the record for the first time. “I don’t feel that it helps to make money or make business.”