Why we doubled-down on S’More — The Anti-Superficial Relationship app
Benson Oak Ventures has the mission to support visionary and execution-focused entrepreneurs build transformative companies. We invest in multi-stages, based on a high-conviction model with the aim to double and triple down to increase our exposure to the best companies.
We led the pre-seed deal in S’More, backing Adam Cohen-Aslatei, sole founder with immense strong founder-market fit. Adam spent over a decade in high-level marketing, product and monetization positions for a wide range of dating companies. We were excited by his vision to define a new category at the intersection of social and dating, positioned as The Anti-Superficial Relationship app.
Due to that belief in Adam and his vision, we led the company’s seed $1M round, which Adam raised prior to product development and market launch. By August 2020, a year had passed since our investment and just 8 months since the January beta launch of S’More and the team has amassed close to 100,000 users (now over 125,000) and is already showing monetization and engagement numbers on par with leading dating apps. Adam’s vision is the basis for S’More’s innovation, moving away from the picture first, effortless swipe and towards finding deeper and more meaningful connections and relationships. The message is resonating with users, as seen through their social, engagement data and feedback. The team is building a community around the product and mission — understanding dating is as much a lifestyle brand as it is an app experience.
Our investment approach is to invest early, devote operational time with the team in areas we can provide value and thus learn about the business from within, in order to develop a sense of conviction required to double down on the investment. This approach represents an investment de-risking strategy while also enabling us to build strong relationships with our founders, providing rapid access to funding at key moment in the company’s trajectory when operational focus of the management is most required.
S’More represented the perfect opportunity where we’ve been consistently impressed by the team and execution around ambitious objectives and key results (OKRs). We decided to double down and lead their second seed round alongside a great consortium of current and new notable investors such as Work Play Ventures (Mark Pincus), Loud Capital, Gaingels, SideCar Angels, Josh Black of Apollo Management, Brad Wechsler former CEO IMAX, John Abbott former CEO of The Meet Group, and many other notable angels. This gives the company the opportunity to accelerate their growth and capitalize on the strong momentum they have shown in creating a desired new niche in an increasingly dated industry (pun intended)
We’re excited to see the team consistently build upon their mission and get such strong market receptivity. For more details on how S’More addressed the basic 4 Question Investment approach, keep reading!
IS IT A B2M² COMPANY
In 2019 at least 40% of relationships in the US started online. By the end of this decade it’s not unreasonable that almost all new relationships will start online. Part of the reason for this dramatic growth is that online dating removes friction and fits perfectly into people’s increasingly busy life styles. In the US, singles use anywhere between 2–4 dating apps at the same time and the usage stats are staggering: Dating apps are used for about 9.8 days a year, compared to Snap (4d), Instagram (8.7 d) and facebook (14.7 d).
Dating apps are used as frequently as the best social apps and monetize like top grossing games
Alongside strong usage numbers, there’s proven monetization models with Tinder generating $800M in revenue and Bumble — only 4 years old — generated around $200 in 2018. Late 2019, Blackstone took a majority stake in MagicLab (Owner of dating apps Bumble, Chappy, Lumen…) at a ~$3B valuation. And they are expected to go public in Q1 at a $6–9B valuation.
Covid has only accelerated usage trends across consumer apps and loneliness + social distancing is pushing many to look for more meaningful interactions online. S’More is seeing this across different usage metrics of people returning to the app, number of chats started and chat lengths. All metrics are showing upward trends in an app that shuns traditional forms of swiping and liking and impersonal, infrequent chats.
Dating is a global and growing phenomenon with over 300M users worldwide — excluding China. Because S’More isn’t about superficial connections and pictures first, they are a great fit for the many conservative countries around the globe.
HOW DO THEY WIN?
From our very first meeting it was crystal clear Adam is the ideal founder to undertake this journey. He started out with a strong product and brand vision for S’More — for those wanting something more (most frequent feedback of existing swiping culture dating apps) and built an exceptional and diverse team.
They’ve been launching city by city with local ambassadors and events (both IRL and virtual). They approach online dating & relationships as both an exquisite app experience and a lifestyle brand. Adam has the weekly S’More Live show on IG with over 40 celebrity chats about dating and relationships. They are receiving a lot of inbound attention from the press as their message is timely and resonates, especially during these times of Covid and Black Lives Matter. For example S’More was one of the only dating to have never had any race filters (other apps have since removed).
Ultimately we believe S’More will win because of user love, the community they are building, and staying true to their mission. There is massive untapped potential by rethinking how we meet online, especially for the growing number of people that are looking for Something More.
The Product
The S’More profile stands out from the crowd because the focus isn’t on photos (initially), which are automatically blurred. S’More users enjoy a more dynamic profile setup displaying colorful icons, animations, voice recordings, and music. Each profile has a unique look and sound that represents who a person is beyond the surface level.
From Adam: “S’More represents a layered cookie because it’s about getting to know all the layers of a person,” Adam explained. “We wanted to change user behavior to be more intentional and more about getting to know a person before passing judgment on little more than a selfie.”
S’More is a next gen relationship app, built to provide daters with a totally interactive way to learn more about a person, before evaluating them on appearance. They reinvented the experience and the profile into a modular, scrollable, interactive interface where users decide what to show and highlight.
As a user, you build out a scrollable, modular, interest-centric profile that highlights what you want others to see. You get daily matches based on matching interests, with photos that unblur as you interact with the profile and exchange messages. The idea is to get to know something about the other person before seeing them.
These interactive modular profiles open up a wide range of product and experience possibilities while being visually compelling and interactive. It takes the old web experience of questions and answers and transforms it into a mobile friendly experience while removing the arduous process of typing out the answers to those questions.
The team is consistently testing features in line with the mission and voice while at the same time focused on improving KPI’s around engagement, user retention and premium paying users.
S’More puts user safety first. Users are prodded to verify their images through product flow and limiting app capabilities if not verified. 100% of profiles are verified via AI tech to prevent cat-fishing. This ensures that users aren’t faced with fake and spammy profiles (big issue on other apps). They add internal rating systems to incentivize good and proper behavior making sure all users, and especially women feel safe. All of these are part of the messaging and branding and highly relevant for more conservative countries.
The company has 300 + 4 star reviews and have exciting changes coming to the product from lessons learned since initial launch. They are live in 6 cities (NY, Boston, Washington DC, Chicago, LA and now Dallas!) and have been covered in the press across the US and in the UK by the WSJ, WashPost, Forbes, Elle, Marie Claire, and more. They were even spoofed on Comedy Central and were featured as a Hot Topic on The View.
IS THE BUSINESS MODEL SCALABLE AND SELF-SUFFICIENT?
At Benson Oak we lead investments in consumer products that have monetization and strong business foundations from the get go.
The dating industry, much like the gaming industry has clearly defined and proven business models. Mostly a mix of subscription + a la carte selections of premium features. As a reference, Tinder generated $800M in revenues from their 4.1M paying users in 2018.
S’More built the product with monetization in place at launch and while focus was on user experience initially, we’re now seeing consistent revenue growth with growing number of renewals. In the longer run, their investment in community, brand and unique content generates strong organic growth and awareness without an over-reliance on paid performance marketing.
BOV LEADING THE ROUND
We consider Adam to be the ideal founder — market fit, spending over 10 years in the industry building and monetizing product. He’s built a strong team and generated exceptional traction, launching an app right as Covid started.
We led the pre-seed in S’More as it strongly fit our investment thesis — a strong consumer product, building a community around the brand and monetization from day 1. We’re excited to now double down and lead their seed with a consortium of strong new and existing value add investors and be there alongside S’More as they continue to define a new dating category — of finding meaningful connections and relationships online.
