Dating firm probes ‘fake partners’ claim
Shares in Edinburgh-based Cupid hammered in City
Saturday 23 March 2013 DATING website firm Cupid, hailed as one of Scotland’s most promising technology companies, saw tens of millions of pounds wiped off its value yesterday as it launched an investigation into claims of staff posing as members.
The probe follows allegations in a newspaper in Ukraine, where many of the Edinburghheadquartered firm’s staff are based, after a female reporter went undercover to secure a job interview with the company’s “motivation team”.
Cupid has been the subject of a BBC investigation this year into claims, which it denied, that fake profiles were created to encourage members to take out subscriptions.
The share price of Cupid – headed by serial technology entrepreneur Bill Dobbie and behind brands including UniformDating.com, Flirt. com BeNaughty.com and IndianDating.com – plunged after a financial blogger circulated copies of the article from the
newspaper. The shares more than halved within hours, knocking £55 million off its value and closed down 57 per cent at 49p.
Mr Dobbie, 54, saw almost £10m wiped off the value of his personal stake in the company, which has 54 million members across its network of sites.
The Ukrainian newspaper report claimed that during a job interview in the country, a re-
“Cupid said it has commissioned an independent audit by one of the ‘big four’”
porter was told that the role involved posing as a female user of the dating site and encouraging male users to buy memberships.
In response the company issued a statement saying it did employ a motivation team of 24 people working across three shifts, covering a range of websites and companies.
It said the team does not communicate with free members, but that it does communicate with new paying subscribers to “help them get the most out of the site”.
Cupid said it has now commissioned an independent audit by one of the “big four” accounting firms and will report the findings to the market as soon as possible.
The company said that the audit team would also address an allegation in the article that members who have signed on a three-day trial membership are encouraged through messages created by Cupid employees to move to a full subscrip- tion. Just three weeks ago, Mr Dobbie said his confidence in the business he founded was “as strong as ever” as he took advantage of the depressed share price to build his stake by almost £1m.
His share purchase followed latest results showing a 31 per cent jump in annual profits and promising another year of “healthy growth” ahead.
Mr Dobbie, who owns 17.6 per cent of the firm, founded Cupid in 2005 alongside business partner Max Polyakov.
Last year Mr Polyakov left the business to work on a US venture but he still holds a signifi- cant stake. Cupid employs some 25 staff in Castle Street, Edinburgh, and late last year moved to larger premises which gave it the capacity to double its workforce over time.
The early success of the company after its flotation in 2010 saw its share price soar to more than 220p at one point, meaning it was worth, at the time, almost as much as stock market veterans Robert Wiseman Dairies.
The company was originally called EasyDate but changed its name after a legal challenge from EasyJet.
Mr Dobbie was not available for comment yesterday.