OkCupid, a free online dating site, has raised $6 million from a group of angels, CEO Sam Yagan told GigaOM. Each time I talk to Yagan about his new company, he pulls out some variation on the same line: “Our goal is to reduce GDP by half a billion dollars by completely eliminating the subscription online dating market.”
Yagan says he can run a successful dating site without making people pay, something PlentyofFish has also had success with. OkCupid currently has 600,000 active users (measured as those who’ve logged on in the last 90 days). It’s not apples-to-apples, but leader Match.com has 1.3 million subscribers. PlentyofFish reports a quarter million users logging in per day.
“All of the big guys think users want to pay for dating because paying for something equals quality,” says Yagan. “Well, unless Match.com has some way of getting Tom Cruise and all the actors and actresses to stand behind a firewall, our users are their users.”
In brass tacks land, that means the new funding is supposed to go toward broadening marketing efforts beyond viral growth, and expanding to non-English speaking users in Europe and Asia.
Yagan, who’s led two companies before but never taken venture capital, attested he talked to 20 different VC firms last year and received a number of term sheets, but didn’t like the proposed equity distribution. Instead, he went with collecting checks from five angels, whom he says he’s not disclosing because we’ve never heard of them.
Yagan previously led two immensely popular consumer internet products, with varying levels of corporate success: SparkNotes, the online alternative to Cliffs Notes that was bought by Barnes & Noble in 2001, and eDonkey, the peer-to-peer file-sharing application that shut down under pressure from the RIAA.