Facebook Dating App Pulls In $5 Million Annually Through Subscriptions

SNAP InteractiveWhile many have acknowledged that it has become difficult to operate as an independent developer on the Facebook Platform, few are acknowledging the existence of successful small-application developers like Snap Interactive (OCT:STVI), the developers of the “Are You Interested?” application. The company has successfully grown a $5 million a year dating application, shifting from a free model to a subscription model, using Facebook as a cheap source of new user acquisition.

Earlier this week the company formally announced their continued growth in cash receipts. Cliff Lerner, CEO of Snap Interactive stated, “We have seen a monthly increase in average daily gross cash receipts from premium and subscription sales in each month since we introduced the subscription service.” While the data smooths over monthly fluctuations thanks to the company’s GAAP accounting methods, it’s impressive to see ongoing growth despite a more challenging Platform environment.

As the release states, “Due to GAAP accounting, revenues from multi month subscriptions are recognized over the length of the subscription term rather than when purchased.” Despite the month-to-month fluctuations, the company has successfully survived numerous Facebook Platform iterations, each of which have decreased virality for developers. In fact, the company has been around since the first few months of the Facebook Platform.

While the company’s net income has been negative for a couple quarters, the company is squeaking by with close to $2 million in the bank to finance ongoing operations. In other words, SNAP Interactive has successfully built a small business on the Facebook Platform. While the company is no Zynga, they’ve also made the conscious decision to avoid taking on funding despite ongoing presence of well-funded competitors like Zoosk.

In an industry which idolizes large rounds of funding and massive exits, it’s often refreshing to see that small businesses can still be created on the Facebook Platform.

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