We’ve written before about PlentyOfFish, a leading online dating site that is run by a single person and is raking in money. Markus Frind is the singular force behind PlentyOfFish. At the time of our last review, June 2006, PlentyOfFish was earning $10,000 per day from Google Adsense (around $3.5 M per annum).
I caught up with Markus today via email and asked how the business is doing now. He didn’t want to get specific about earnings, but he said that POF will earn $10 Million + next year (which puts it at around $30k per day). So just in earnings, POF has grown rapidly over the past year or so. As well as Adsense, income now comes from banner ads and affiliate marketing. A May Wall St Journal article has a good general profile of Markus and his company.
There is one former fact about PlentyOfFish that has just become a myth – Markus hired his first employee a few weeks ago! This person is doing customer service, a task previously done by Markus and his girlfriend. So technically POF is a two-person company now, but that doesn’t make quite as good a headline 😉
In terms of traffic, currently POF gets 1.2 billion page views/month, and 500,000 average unique logins per day. The peak season is January, when it will grow 30% according to Markus. I asked what is the total number of users that POF has currently, but Markus replied that total users means nothing in the dating industry. He said that True.com and others claim 20 million users, yet fewer than 100,000 people a day actually login and use those services. According to Hitwise stats, POF is second in the US online dating market and 1st in Canada and UK.
Comparison with Facebook
What really pricked up my ears was when Markus started to talk about click-through rates and how that compared POF with Facebook. As you’ll recall, Facebook supposedly has a valuation of $15 Billion currently, thanks to Microsoft’s $240 investment last week. Many people are skeptical of the Facebook valuation though, because Facebook and social networks are known to be poor at generating money from ads.
Markus told me that per page view, Plentyoffish has 5-10 times the click through rate of Facebook. So by his calculations, POF’s 1.2 Billion page views per month is the same as 5-10 Billion Facebook page views per month. Facebook “only” generates 40 billion page views a month and yet it has a $15 Billion valuation. But the crux of Markus’ argument is that despite having about 33 times the monthly traffic of POF, Facebook’s poor click-through ads should bring the valuation models closer. Markus said that “over 40% of Facebook’s pageviews are image related, ads in bad positions and users just generally looking to waste time.” He said that “there are only a handful of sections on the site [Facebook] that will generate good click thru rates for advertisers.”
So getting down to nitty gritty metrics, Markus concluded that “Facebook is only able to generate 10 to 15 times as many clicks on ads as my site and it’s valued at 15 billion. Needless to say I’m watching ad supported business model valuations very closely.” What’s more, some of his direct competitors – e.g. Eharmony and match.com – are apparently valued in the billions.
While Markus didn’t put a figure on what PlentyOfFish is probably worth, it’s clear he is thinking in Billions and not Millions. It’s very hard to quantify this, but at the very least POF would be worth in the 9 figures due to its annual revenues of $10M. Not bad for a one-man company (plus a new Customer Service Rep!).