grnd-20230630

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

________________________

FORM 10-Q

________________________

(Mark One)


x			QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended June 30, 2023


o			TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from _________ to _________

Commission file number 001-39714

________________________

Grindr Inc.

(Exact name of registrant as specified in its charter)

________________________


Delaware						92-1079067
(State or other jurisdiction of incorporation or organization)						(I.R.S. Employer Identification No.)

PO Box 69176 750 N. San Vincente Blvd., Suite RE 1400 West Hollywood, California						90069
(Address of Principal Executive Offices)						(Zip Code)

(310) 776-6680

Registrant's telephone number, including area code

N/A

(Former name, former address and former fiscal year, if changed since last report)

________________________

Securities registered pursuant to Section 12(b) of the Act:


Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Common Stock, $0.0001 par value per share	GRND	New York Stock Exchange
Warrants, each whole warrant exercisable for one share of Common Stock at an exercise price of $11.50 per share	GRND.WS	New York Stock Exchange

Indicate by check mark whether the registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports); and (2) has been subject to such filing requirements for the past 90 days. Yes x No o

Indicate by check mark whether the registrant has submitted electronically, every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes x No o

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer”, “smaller reporting company” and "emerging growth company" in Rule 12b-2 of the Exchange Act.


Large accelerated filer	o	Accelerated filer	o
Non-accelerated filer	x	Smaller reporting company	x
		Emerging growth company	x

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act). Yes ☐ No x

The registrant had 174,066,386 shares of common stock outstanding as of August 7, 2023.

Table of Contents

TABLE OF CONTENTS


		Page
Special Note Regarding Forward-Looking Statements		2
PART I.	FINANCIAL INFORMATION	3
Item 1.	Financial Statements (Unaudited)	3
	Condensed Consolidated Balance Sheets	3
	Condensed Consolidated Statement of Operations and Comprehensive Income (Loss)	4
	Condensed Consolidated Statement of Stockholders ’ Equity	5
	Condensed Consolidated Statement of Cash Flows	7
	Notes to Unaudited Condensed Consolidated Financial Statements	8
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	25
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	40
Item 4.	Controls and Procedures	40
PART II.	OTHER INFORMATION	41
Item 1.	Legal Proceedings	41
Item 1A.	Risk Factors	41
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	42
Item 3.	Defaults Upon Senior Securities	42
Item 4.	Mine Safety Disclosures	42
Item 5.	Other Information	42
Item 6.	Exhibits	43
	Signatures	44

Table of Contents

SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS

Some of the statements contained in this Quarterly Report on Form 10-Q constitute forward-looking statements within the meaning of the federal securities laws. Forward-looking statements relate to expectations, beliefs, projections, future plans and strategies, anticipated events or trends and similar expressions concerning matters that are not historical facts. These forward-looking statements include statements regarding our intentions, beliefs and current expectations and projections concerning, among other things, results of operations, financial condition, liquidity, prospects, growth, strategies and the markets in which we operate. In some cases, you can identify these forward-looking statements by the use of terminology such as “outlook,” “believes,” “expects,” “potential,” “continues,” “may,” “will,” “should,” “could,” “seeks,” “approximately,” “predicts,” “intends,” “plans,” “estimates,” “anticipates” or the negative version of these words or other comparable words or phrases.

The forward-looking statements contained in this Quarterly Report on Form 10-Q reflect our current views about our business and future events and are subject to numerous known and unknown risks, uncertainties, assumptions and changes in circumstances that may cause its actual results to differ significantly from those expressed in any forward-looking statement. There are no guarantees that the transactions and events described will happen as described (or that they will happen at all). The following factors, among others, could cause actual results and future events to differ materially from those set forth or contemplated in the forward-looking statements:

•the success in retaining or recruiting, or changes required in, our directors, officers or key employees;

•the impact of the regulatory environment and complexities with compliance related to such environment, including maintaining compliance with privacy and data protection laws and regulations;

•the ability to respond to general economic conditions;

•factors relating to our and our subsidiaries’ business, operations and financial performance, including:

◦competition in the dating and social networking products and services industry;

◦the ability to maintain and attract users;

◦fluctuation in quarterly and yearly results;

◦the ability to adapt to changes in technology and user preferences in a timely and cost-effective manner;

◦the ability to protect systems and infrastructures from cyber-attacks and prevent unauthorized data access;

◦the dependence on the integrity of third-party systems and infrastructure; and

◦the ability to protect our intellectual property rights from unauthorized use by third parties.

•whether the concentration of our stock ownership and voting power limits our stockholders’ ability to influence corporate matters;

•the effects of the ongoing coronavirus (“COVID-19”) pandemic, or other infectious diseases, health epidemics, pandemics and natural disasters on our business;

•the ability to maintain the listing of our common stock and public warrants on the New York Stock Exchange (“NYSE”); and

•the increasingly competitive environment in which we operate.

In addition, statements that “Grindr believes” or “we believe” and similar statements reflect our beliefs and opinions on the relevant subjects. These statements are based upon information available to us as of the date of this Quarterly Report on Form 10-Q, and while we believe such information forms a reasonable basis for such statements, such information may be limited or incomplete, and such statements should not be read to indicate that we have conducted an exhaustive inquiry into, or review of, all potentially available relevant information. These statements are inherently uncertain and investors are cautioned not to unduly rely upon these statements.

While forward-looking statements reflect our good faith beliefs, they are not guarantees of future performance. Except to the extent required by applicable law, we are under no obligation (and expressly disclaim any such obligation) to update or revise our forward-looking statements whether as a result of new information, future events, or otherwise. For a further discussion of these and other factors that could cause our future results, performance or transactions to differ significantly from those expressed in any forward-looking statement, please see the section titled “Risk Factors” included under Part I, Item 1A in our Annual Report on Form 10-K for the year ended December 31, 2022. You should not place undue reliance on any forward-looking statements, which are based only on information currently available to us (or to third parties making the forward-looking statements).

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PART I – FINANCIAL INFORMATION

Item 1. Condensed Consolidated Financial Statements

Grindr Inc. and subsidiaries

Condensed Consolidated Balance Sheets (unaudited)

(in thousands, except share data)


	June 30,		December 31,
	2023		2022
Assets
Current Assets
Cash and cash equivalents	$	22,091	$	8,725
Accounts receivable, net of allowance of $1,258 and $336, respectively	30,753		22,435
Prepaid expenses	6,117		7,622
Deferred charges	3,651		3,652
Other current assets	408		750
Total current assets	63,020		43,184
Restricted cash	1,392		1,392
Property and equipment, net	1,728		2,021
Capitalized software development costs, net	7,994		7,385
Intangible assets, net	90,766		104,544
Goodwill	275,703		275,703
Right-of-use assets	3,966		4,535
Other assets	140		64
Total assets	$	444,709	$	438,828
Liabilities and Stockholders’ Equity
Current liabilities
Accounts payable	$	3,294	$	5,435
Accrued expenses and other current liabilities	21,590		15,681
Current maturities of long-term debt, net	22,377		22,152
Deferred revenue	18,569		18,586
Total current liabilities	65,830		61,854
Long-term debt, net	320,551		338,476
Warrant liability	26,152		17,933
Lease liability	2,977		3,658
Deferred tax liability	7,615		12,528
Other non-current liabilities	787		327
Total liabilities	423,912		434,776
Commitments and Contingencies (Note 14)
Stockholders’ Equity
Preferred stock, par value $0.0001; 100,000,000 shares authorized; none issued and outstanding at June 30, 2023 and December 31, 2022, respectively	—		—
Common stock, par value $0.0001; 1,000,000,000 shares authorized; 174,053,659 and 173,524,360 shares issued; 174,053,659 and 173,524,360 shares outstanding at June 30, 2023 and December 31, 2022, respectively	17		17
Additional paid-in capital	36,391		9,078
Accumulated deficit	(15,611)		(5,043)
Total stockholders’ equity	20,797		4,052
Total liabilities and stockholders’ equity	$	444,709	$	438,828

See accompanying notes to unaudited condensed consolidated financial statements.

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Grindr Inc. and Subsidiaries

Consolidated Statements of Operations and Comprehensive (Loss) Income (unaudited)

(in thousands, except per share and share data)


	Three Months Ended June 30,				Six Months Ended June 30,
	2023		2022		2023		2022
Revenue	$	61,538	$	46,555	$	117,347	$	90,085
Operating costs and expenses
Cost of revenue (exclusive of depreciation and amortization shown separately below)	16,110		12,102		30,925		23,803
Selling, general and administrative expense	17,158		23,234		36,103		33,612
Product development expense	6,200		4,175		11,706		7,822
Depreciation and amortization	8,140		9,092		16,092		18,118
Total operating expenses	47,608		48,603		94,826		83,355
Income (loss) from operations	13,930		(2,048)		22,521		6,730
Other expense
Interest expense, net	(12,917)		(3,256)		(23,710)		(6,212)
Other income (expense), net	169		2		292		(66)
Change in fair value of warrant liability	7,098		—		(8,219)		—
Total other expense	(5,650)		(3,254)		(31,637)		(6,278)
Net income (loss) before income tax	8,280		(5,302)		(9,116)		452
Income tax (benefit) provision	(14,051)		(1,000)		1,452		253
Net income (loss) and comprehensive income (loss)	$	22,331	$	(4,302)	$	(10,568)	$	199
Net income (loss) per share:
Basic	$	0.13	$	(0.03)	$	(0.06)	$	—
Diluted	$	0.13	$	(0.03)	$	(0.06)	$	—
Weighted-average shares outstanding:
Basic	173,896,490		155,681,830		173,749,027		155,624,369
Diluted	174,380,412		155,681,830		173,749,027		156,657,212

See accompanying notes to unaudited condensed consolidated financial statements.

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Grindr Inc. and subsidiaries

Condensed Consolidated Statements of Stockholders’ Equity (unaudited)

(in thousands, except per share amounts and share data)


	Preferred Stock (Par value $0.0001)			Common Stock (Par value $0.0001)			Series Y Preferred Units (Par value $0.00001)			Series X Ordinary Units (Par value $0.00001)			Additional paid-in capital		Accumulated deficit		Total stockholders’ equity
	Shares	Amount		Shares	Amount		Shares	Amount		Shares	Amount
Balance at December 31, 2021, as previously reported	—	$	—	—	$	—	—	$	—	110,867,483	$	1	$	269,131	$	(5,895)